(Bloomberg) – Occidental Petroleum Corp. is in talks to sell its OxyChem petrochemical unit in a deal worth at least $10 billion, the Financial Times reported Sunday.
The divestment would be the U.S. company’s biggest yet and would create one of the world’s largest standalone petrochemical companies, according to the FT, which cited two people familiar with the matter that it didn’t identify. The potential buyer couldn’t immediately be determined, the report said.
Occidental, which is backed by Warren Buffett, has been divesting assets in an effort to reduce debt. The divestment is likely to be announced in the coming weeks, the report said.
The Houston-based firm previously helped drive a consolidation in U.S. oil and gas that includes its takeover of Anadarko Petroleum Corp. in 2019 and the $10.8 billion acquisition of CrownRock LP last year. Occidental has embarked on a divestiture program since the CrownRock transaction.
Shares of energy companies including Occidental, Chevron, ExxonMobil and Diamondback Energy rose last week after President Donald Trump said the U.S. was open to imposing more tariffs on Russia and called on European countries to stop buying Russian oil.
Occidental has a diverse international footprint in oil and gas, according to Bloomberg Intelligence. Even so, its onshore assets are still expected to provide most of its profit and free cash flow.
Occidental subsidiary 1PointFive this month formed a 50-50 joint venture with Enbridge Inc. to develop the Pelican Sequestration Hub and related transportation infrastructure in Louisiana.
1PointFive will develop underground carbon dioxide storage while Enbridge will build and operate pipelines from customers to the hub.
