I'm trying to come up with a scenario of how OXY legitimately avoids BK, and besides a bail out from an increase in commodity prices, I just don't see it. They are clearly strapped for cash (paying Buffett his quarterly dividends in common stock). Asset sales aren't being realized (the Total deal is still tied up in a capital gains tax argument). Anything else on the chopping block is surely at a fire sale price now. Hedges s—. WES isn't worth what it was. Shale doesn't work at $30 oil. Debt maturities are due starting with $3B Feb/March 2021. $6.4B total due next year. But you can wear a Hawaiian shirt on Friday :)
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With negative oil price , it is happening
LAPC all received their payouts as lump sums. Good for them. Bad for us.
No, OXY will not go BK, Berkshire and Cahn will own the company very soon. V will negotiate a $100 million buyout and move to her ranch in Colorado.
@rsf: what about LACP who took the VSP last fall?
@gxn
LOXY VSP paid out over a year from VSP start date , not the same as CoC for LAPC, no lump sum.
@zbl: what do you mean you hope you get all your severance? Did you not get it already??
In old computer technology, EOR = End Of Record
Funny thing about Oxy is that they had been taking $200MM to $300MM out of their EOR budget every year for the past few years and that money went to Permian Resources. Guess which one has the lower production costs?
Glad I got out (LOXY) with VSP late last year after 12 years; I hope they can delay BK until they pay all my severance.
Hopefully, this is the death knell for Oxy Low Carbon Ventures!
Good luck to all remaining employees, LOXY or LAPC; both groups betrayed by their upper management (a true oxymoron) teams
But we have the best EOR!!!!!
At least we can all be on the inevitable Oxy “fall from glory” documentary.
Back to the stone age and Mad Max it is then. Where's my club??
Oxy has a $5 billion revolver, but not many other good options. Oxy's bonds are Ba1 junk and will probably be downgraded again. Current yields for 2021 bonds are over 10%. The credit market isn't an option. Oxy will need to cut the remaining dividend, like yesterday. Oxy could sell assets, but not many people will be buying right now. Even if they do find a buyer, they will have to settle for fire sale prices. Oxy could issue more shares, but this will just continue diluting the share price. Better than $0 a share I guess?
Oxy might make it through 2020 if we are lucky, but it will have $6.4 billion in debt maturing in 2021. If oil isn't back up over $40 by Q1 then that's the ballgame. And I think those projections are EXTREMELY optimistic. Once capacity is reached, WTI will basically be worthless within a few weeks.
Even after the shutdowns end, the destruction to the economy from COVID-19 will take years to fix. It will not be like turning on a light. The businesses that have failed will be gone. There will be problems with liquidity and a lack of capital investment. Everyone can't just go back to the same jobs they were doing before. Unemployment will linger for many months. People aren't going to pile into airplanes, cruise ships, movie theaters, bars, restaurants and stadiums the day after the shut down ends. The economy will slowly start sputtering again, but it won't look anything like before.
Sorry to say it, my friends, but we have reached the middle of the end. Good luck to everyone.
I agree on many fronts and one being Colorado does not want us oil field trash up there. Too much government BS to wade through and most Colorado residents look at oil and gas as a black eye on the environment. I say let them have their beautiful country and spend 5.00 a gallon to import gasoline and other fuels from outside the state. Love the place, but hate the hypocrisy of the state. Not sure anyone wants to buy DJ at a decent price.
Sell the DJ. PLEASE!!!
But...OXY is the operator of choice! LAWLZ