Occidental sells $750MM Ghana stakes as part of debt-reduction focus

HOUSTON (Bloomberg) --Occidental Petroleum Corp. agreed to sell its stakes in two Ghanaian oil fields for $750 million, ending a two-year divestment effort aimed at cutting debt.

Kosmos Energy Ltd. will pay $550 million and Ghana National Petroleum Corp. will pay $200 million for the Houston-based company’s interests in the Jubilee and TEN offshore fields, Occidental said in a statement Wednesday. The proceeds will be used to reduce Occidental’s debt, which exploded nearly five times to more than $48 billion after it bought Anadarko Petroleum Corp. in 2019.

The deal means that Occidental has now sold just over $2 billion of assets in the past year, meeting a self-imposed disposal target that is key to the company’s debt repayment goals. The company has centered its entire strategy around reducing its debt load, even going so far as hold shale production at reduced levels this year as oil prices surged.

The Ghana assets were inherited as part of the Anadarko deal and always considered non-core, given that they were minority stakes in a country where Occidental had little history of operating. The company had previously agreed to sell the assets to TotalEnergies SE as part of a wider African sale, which eventually fell through amid regulatory and tax issues.

Kosmos already owns a 24% stake in the Jubilee field and 17% of TEN. Both fields are operated by London-based Tullow Oil Plc. Last month, Bloomberg reported that Dallas-based Kosmos was in talks to buy Occidental’s stakes.

Kosmos said the deal would bring its stake in Jubliee to 42% and TEN to 28% and would be financed by a $400 million bridge loan that will be refinanced with a future bond offering. The rest will be funded with the proceeds of a share sale worth about $100 million.

The company expects that the cash flow from the assets mean the deal will pay itself back in less than three years at $65 a barrel Brent. Brent crude is currently trading above $80 a barrel.

Separately, Occidental settled “certain tax claims related to historical operations,” the company said.