Company: OXY-WT
Filing Date: 2025-02-18
Form Type: 10-K
Source: 0000797468-25-000029
Chunk: 182

Company: OCCIDENTAL PETROLEUM CORP /DE/
Filing Date: 2025-02-18
Form: 10-K
Item: Item 7
Chunk 182
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 in EOR, major projects development and OxyChem plant operations to further the development of CCUS projects. OLCV invests in emerging low-carbon technologies that are expected to reduce Occidental’s carbon footprint and ensure the long-term sustainability of Occidental’s core businesses, and enable others to do the same. 

Capital is employed to sustain or expand assets to improve the competitiveness of Occidental’s businesses. In 2024, capital expenditures related to the midstream and marketing segment totaled $880 million, before contributions from noncontrolling interests, the majority of which were related to the construction of STRATOS.

BUSINESS ENVIRONMENT

Midstream and marketing segment earnings are affected by the performance of its various businesses, including its marketing, gathering and transportation, gas processing and power-generation assets. The marketing business aggregates, markets and stores Occidental and third-party volumes. Marketing performance is affected primarily by commodity price changes and margins in oil and gas transportation and storage programs. The marketing business results can experience significant volatility depending on commodity prices and the Midland-to-Gulf-Coast oil spreads and Waha-to-Gulf-Coast gas spreads. The Midland-to-Gulf-Coast oil spreads have increased to an average of $0.49 per barrel in 2024 from an average of $0.21 per barrel in 2023. A $0.25 change in the Midland-to-Gulf-Coast oil spreads impacts 2024 operating cash flows by approximately $65 million. The Waha-to-Gulf-Coast gas spreads have increased to an average of $1.49 per MMbtu in 2024 from an average of $0.54 per MMbtu in 2023. Gas gathering, processing and transportation results are affected by fluctuations in commodity prices and the volumes that are processed and transported through the segment’s plants, as well as the margins obtained on related services from investments in which Occidental has an equity interest.

BUSINESS REVIEW

MARKETING

The marketing group markets substantially all of Occidental’s oil, NGL and natural gas production and optimizes its transportation and storage capacity. Occidental’s third-party marketing activities focus on purchasing oil, NGL and natural gas for resale from parties whose oil and gas supply is located near its transportation and storage capacity. These purchases allow Occidental to aggregate volumes to better utilize and optimize its assets. In 2024, compared to 2023, marketing results were impacted by higher gas marketing margin from transportation capacity optimization and higher equity method investment income from W