Jan. 25 (Bloomberg) -- Occidental Petroleum Corp., the largest onshore crude producer in the continental U.S., said fourth-quarter profit rose on higher oil prices and increased output from new drilling in California, Texas and North Dakota.
Net income climbed to $1.63 billion, or $2.02 a share, from $1.21 billion, or $1.47, a year earlier, Los Angeles-based Occidental said in a statement on Business Wire today. Per-share profit excluding asset impairments and tax benefits was $2.01, more than the $1.96 average of 19 analysts’ estimates compiled by Bloomberg.
Chief Executive Officer Stephen I. Chazen, who took over in May, has said the company’s U.S. crude production will grow by as much as 48,000 barrels a day in 2012, much of it in California. Occidental owns about 870,000 acres of land in the Monterey Shale, which holds more than 15 billion barrels of oil, according to the U.S. Energy Information Administration.
“The outlook for the California play is really the company-maker in the eyes of all the investors that we’re talking to,” Fadel Gheit, an analyst at Oppenheimer & Co. LLC in New York, said in a telephone interview before earnings were released. “The only upside potential going forward is the results of drilling in California.”
Oil futures traded in New York jumped 10.3 percent to average $94.06 a barrel during the last three months of the year on speculation that the U.S. economy will continue to recover and sanctions in Iran could cut off the flow of oil from the world’s fourth-largest crude-producing country. Prices for West Texas Intermediate Crude, the U.S. benchmark, traded at an average of $85.24 a year earlier.
The earnings were announced before regular trading began on U.S. markets. Occidental fell 1.1 percent to $100.92 yesterday in New York. The stock, which has 18 buy ratings and five holds from analysts, rose 5.9 percent in the past 12 months.
(Occidental scheduled an earnings conference call at 11:30 a.m. New York time, accessible at EVTS <GO>.)
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