Question · Q3 2025
Neal Dingnann asked about the primary drivers behind Occidental's exceptionally low Permian well costs, specifically inquiring if larger projects contributed significantly to this achievement. He also sought clarification on the expected returns from the incremental upside generated by Enhanced Oil Recovery (EOR) projects.
Answer
Richard Jackson (SVP and COO) explained that the low Permian well costs resulted from a combination of operational efficiency improvements, strategic re-evaluation of service contracts, and the benefits of scale in the Midland Basin through integrating best practices from Oxy and legacy CrownRock teams. He stated that current EOR returns are in the 25%-35% range, with expectations for these to improve further with increased uplift, underscoring the competitive nature of capital allocation within the portfolio.