Occidental’s Lone Permian Rig Shows Severity of Shale Bust
- Shares plunge 8% for day’s worst performance in the S&P 500
- Earnings missed estimates, though output exceeded forecast
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Occidental Petroleum Corp. will have just a single oil rig in the Permian Basin in the second half of the year, illustrating the scale of the shale industry’s pullback and the company’s debt woes.
The deal to buy Anadarko Petroleum Corp. last year was supposed to consolidate Occidental’s position as the largest oil producer in the Permian, but instead did the opposite. In May of last year, Occidental was running 12 rigs in the shale region of West Texas and New Mexico, while Anadarko had a further 10, meaning the current plans represent a 95% decline in drilling.