Chazen: "Permian Basin is the Cornerstone for OXY"
We're talking about decades of profits and growth for OXY shareholders. Here is an excerpt on OXY's Permian Basin's holdings, from Motley Fool:
Occidental Petroleum's (NYSE: OXY ) largest U.S. operation is in the Permian Basin of West Texas and southeast New Mexico, where it is the No. 1 oil producer, accounting for 16% of total production. This means its sales and profits are greatly influenced by developments in this region, making it a top selection for investors looking for significant exposure to the Permian Basin.
Citing the potential of the Permian Basin during its first quarter presentation, Steve Chazen, President & CEO stated: "Permian resources is the cornerstone growth operation for the domestic business. Our substantial acreage position in the Permian gives us significant resource development potential."
He continued: "We are starting to see the positive results of our horizontal drilling program, expect the resources business to grow production rapidly, similar to what some other operators in the basin have been able to achieve. We believe this business could increase its production by 13% to 16% this year, and in excess of 20% going forward."
Those are huge gains, and if they translate to profits, as expected, Occidental could have its best days ahead with decades of production expected. One might expect a company with such potential to command a premium, but looking at Occidental's fundamentals that doesn't appear to be the case. In fact, it looks to be downright cheap.