UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2022

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to ___________

Commission file number 1-9210

_____________________

OCCIDENTAL PETROLEUM CORPORATION

(Exact name of registrant as specified in its charter)

(713) 215-7000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

þ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

þ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer þ Accelerated Filer ☐ Non-Accelerated Filer ☐

Smaller Reporting Company ☐ Emerging Growth Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

☐ Yes þ No

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

ABBREVIATIONS USED WITHIN THIS DOCUMENT

PART I FINANCIAL INFORMATION

(a) Included $99 million and $85 million of current finance lease liabilities as of March 31, 2022 and December 31, 2021, respectively.

(b) Included $540 million and $504 million of finance lease liabilities as of March 31, 2022 and December 31, 2021, respectively.

The accompanying notes are an integral part of these Consolidated Condensed Financial Statements.

Showing the first 8K of 76K characters. Open the full section

The following discussion should be read together with the Consolidated Condensed Financial Statements and the notes to Consolidated Condensed Financial Statements, which are included in this report in Part I, Item 1; the information set forth in Risk Factors under Part II, Item 1A; the Consolidated Financial Statements and the notes to the Consolidated Financial Statements, which are included in Part II, Item 8 of Occidental's Annual Report on Form 10-K for the year ended December 31, 2021; and the information set forth in Risk Factors under Part I, Item 1A of the 2021 Form 10-K.

Portions of this report contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws, and they include, but are not limited to: any projections of earnings, revenue or other financial items or future financial position or sources of financing; any statements of the plans, strategies and objectives of management for future operations or business strategy; any statements regarding future economic conditions or performance; any statements of belief; and any statements of assumptions underlying any of the foregoing. Words such as “estimate,” “project,” “predict,” “will,” “would,” “should,” “could,” “may,” “might,” “anticipate,” “plan,” “intend,” “believe,” “expect,” “aim,” “goal,” “target,” “objective,” "commit," "advance," “likely” or similar expressions that convey the prospective nature of events or outcomes are generally indicative of forward-looking statements. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this report. Unless legally required, Occidental does not undertake any obligation to update, modify or withdraw any forward-looking statements as a result of new information, future events or otherwise.

Although Occidental believes that the expectations reflected in any of its forward-looking statements are reasonable, actual results may differ from anticipated results, sometimes materially. In addition, historical, current and forward-looking sustainability-related statements may be based on standards for measuring progress that are still developing, internal controls and processes that continue to evolve and assumptions that are subject to change in the future. Factors that could cause results to differ from those projected or assumed in any forward-looking statement include, but are not limited to: the scope and duration of the COVID-19 pandemic and ongoing actions taken by governmental authorities and other third parties in response to the pandemic; Occidental’s indebtedness and other payment obligations, including the need to generate sufficient cash flows to fund operations; Occidental’s ability to successfully monetize select assets and repay or refinance debt and the impact of changes in Occidental’s credit ratings; assumptions about energy markets; global and local commodity and commodity-futures pricing fluctuations; supply and demand considerations for, and the prices of, Occidental’s products and services; actions by OPEC and non-OPEC oil producing countries; results from operations and competitive conditions; future impairments of our proved and unproved oil and gas properties or equity investments, or write-downs of productive assets, causing charges to earnings; unexpected changes in costs; availability of capital resources, levels of capital expenditures and contractual obligations; the regulatory approval environment, including Occidental's ability to timely obtain or maintain permits or other governmental approvals, including those necessary for drilling and/or development projects; Occidental's ability to successfully complete, or any material delay of, field developments, expansion projects, capital expenditures, efficiency projects, acquisitions or dispositions; risks associated with acquisitions, mergers and joint ventures, such as difficulties integrating businesses, uncertainty associated with financial projections, projected synergies, restructuring, increased costs and adverse tax consequences; uncertainties and liabilities associated with acquired and divested properties and businesses; uncertainties about the estimated quantities of oil, NGL and natural gas reserves; lower-than-expected production from development projects or acquisitions; Occidental’s ability to realize the anticipated benefits from prior or future streamlining actions to reduce fixed costs, simplify or improve processes and improve Occidental’s competitiveness; exploration, drilling and other operational risks; disruptions to, capacity constraints in, or other limitations on the pipeline systems that deliver Occidental’s oil and natural gas and other processing and transportation considerations; general economic conditions, including slowdowns, domestically or internationally, and volatility in the securities, capital or credit markets; inflation; governmental actions, war (including the Russia-Ukraine war) and political conditions and events; legislative or regulatory changes, including changes relating to hydraulic fracturing or other oil and natural gas operations, retroactive royalty or production tax regimes, deep-water and onshore drilling and permitting regulations and environmental regulation (including regulations related to climate change); environmental risks and liability under federal, regional, state, provincial, tribal, local and international environmental laws and regulations (including remedial actions); Occidental's ability to recognize intended benefits from its business strategies and initiatives, such as Occidental's low carbon ventures businesses or announced greenhouse gas emissions reduction targets or net-zero goals; potential liability resulting from pending or future litigation; disruption or interruption of production or manufacturing or facility damage due to accidents, chemical releases, labor unrest, weather, power outages, natural disasters, cyber-attacks or insurgent activity; the creditworthiness and performance of Occidental's counterparties, including financial institutions, operating partners and other parties; failure of risk management; Occidental’s ability to retain and hire key personnel; supply, transportation, and labor constraints; reorganization or restructuring of Occidental’s operations; changes in state, federal or international tax rates; and actions by third parties that are beyond Occidental's control.

Additional information concerning these and other factors that may cause Occidental’s results of operations and financial position to differ from expectations can be found in Occidental’s other filings with the SEC, including Occidental’s 2021 Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.

Occidental’s operations, financial condition, cash flows and levels of expenditures are highly dependent on oil prices and, to a lesser extent, NGL and natural gas prices, the Midland-to-Gulf-Coast oil spreads and the prices it receives for its chemical products. The average WTI $/bbl for the three months ended March 31, 2022 was $94.29, compared to $57.84 for the three months ended March 31, 2021. The return of oil demand to its pre-pandemic levels coupled with the ongoing global impact of the Russia-Ukraine war and whether the oil industry will be able to sustain a continued supply response have resulted in a significant increase in benchmark oil prices. It is expected that the price of oil will be volatile for the foreseeable future given the current geopolitical risks and the effects on oil demand resulting from COVID-19-related travel restrictions and stay-at-home orders in certain international countries.

Occidental does not operate or own assets in either Russia or Ukraine, but continues to monitor any impacts resulting from the Russia-Ukraine war on the global markets for its commodities.

2022 PRIORITIES

Occidental’s capital and operational priorities for 2022 are intended to maximize cash flow by sustaining 2021 production levels. Occidental's cash flow priorities remain to continue to reduce financial leverage while concurrently instituting a shareholder return framework and to maintain a robust liquidity position. In the current commodity price environment, Occidental expects to fund its operational and capital requirements, return capital to shareholders in the form of an increased dividend and institute an active share buy back program with cash flows from operations. During the first quarter of 2022, Occidental generated cash flow from continuing operations of $3.2 billion and incurred capital expenditures of $858 million.

LIABILITY MANAGEMENT

In the first quarter of 2022, Occidental used cash on hand to reduce debt with maturities ranging from 2022 through 2049 by $3.3 billion. Occidental has remaining near-term debt maturities of approximately $362 million in 2023 and $1.4 billion in 2024. Subsequent to March 31, 2022, but before the date of this filing, Occidental paid off additional debt with maturities ranging from 2024 to 2049 and principal of $263 million.

Occidental’s $2.3 billion Zero Coupons can be put to Occidental in October of each year, in whole or in part, for the then accreted value of the outstanding Zero Coupons. The Zero Coupons can next be put to Occidental in October 2022, which, if put in whole, would require a payment of approximately $1.1 billion at such date. Occidental currently has the ability to meet this obligation and may use available capacity under the RCF to satisfy the put should it be exercised.

The remaining interest rate swaps with a fair value of $372 million, net of collateral, as of March 31, 2022, have mandatory termination dates in September 2022 and 2023. The interest rate swaps' fair value, and cash required to settle them on their termination dates, will continue to fluctuate with changes in interest rates through the mandatory termination dates. Depending on market conditions, liability management actions or other factors, Occidental may enter into offsetting interest rate swap positions or settle or amend certain or all of the currently outstanding interest rate swaps.

As of March 31, 2022, Occidental had approximately $1.9 billion of cash and cash equivalents on hand, and as of the date of this filing, $4.0 billion of borrowing capacity and no drawn amounts under its RCF, which matures in June 2025. Additionally, Occidental has up to $400 million of available borrowing capacity and no drawn amounts on its receivables securitization facility which matures in December 2024. Occidental expects its cash on hand and funds available under its RCF to be sufficient to meet its debt maturities, operating expenditures and other obligations for the next 12 months from the date of this filing.

DEBT RATINGS

As of March 31, 2022, Occidental’s long-term debt was rated Ba1 by Moody’s Investors Service, BB+ by Fitch Ratings and BB+ by Standard and Poor’s. Any downgrade in credit ratings could impact Occidental's ability to access capital markets and increase its cost of capital. In addition, given that Occidental’s current debt ratings are non-investment grade, Occidental may be requested, and in some cases required, to provide collateral in the form of cash, letters of credit, surety bonds or other acceptable support as financial assurance of its performance and payment obligations under certain contractual arrangements such as pipeline transportation contracts, environmental remediation obligations, oil and gas purchase contracts and certain derivative instruments.

As of the date of this filing, Occidental has provided required financial assurances through a combination of cash, letters of credit and surety bonds. Occidental has not issued any letters of credit under the RCF or other committed facilities. For additional information, see Risk Factors in Part I, Item 1A of Occidental’s 2021 Form 10-K.

Occidental’s operations and cash flows can vary significantly based on changes in oil, NGL and natural gas prices and the prices it receives for its chemical products. Such changes in prices could result in adjustments in capital investment levels and how such capital is allocated, which could impact production volumes. Significant changes have occurred in the macro-economic environment over the previous year, which have led to an increase in commodity prices, chemical product pricing, and correspondingly Occidental's results of operations and cash flows. Occidental's results of operations and cash flows are driven by these macro-economic effects rather than seasonality. In November 2020, the SEC issued a final rule to Regulation S-K which permits the option to discuss material changes to results of operations between the current and immediately preceding quarter. Occidental has elected to discuss its results of operations on a sequential-quarter basis starting with this filing. The implementation of this approach will provide more meaningful and useful information to investors to measure performance from the immediately preceding quarter. In accordance with this final rule, Occidental is not required to include a comparison of the current quarter and the same prior-year quarter for future filings.

Q1 2022 compared to Q4 2021

Excluding the impact of asset impairments, gains and losses on sales of assets and equity method investments, gains and losses on derivative mark-to-market adjustments, acquisition-related costs, and the tax impact due to the legal entity reorganization, the increase in income from continuing operations for the three months ended March 31, 2022, compared to the three months ended December 31, 2021, was primarily due to higher crude oil prices, partially offset by lower crude oil sales volumes in the oil and gas segment.

Q1 2022 compared to Q1 2021

Excluding the impact of asset impairments, gains and losses on sales of assets and equity method investments, gains and losses on derivative mark-to-market adjustments, acquisition-related costs, and the tax impact due to the legal entity reorganization, the increase in income from continuing operations for the three months ended March 31, 2022, compared to the three months ended March 31, 2021, was primarily due to higher crude oil, NGL and natural gas prices, lower DD&A rates in the oil and gas segment, higher realized prices and margins across most chemical product lines, partially offset by lower crude oil sales volumes.

SELECTED STATEMENTS OF OPERATIONS ITEMS

Q1 2022 compared to Q4 2021

Net sales increased for the three months ended March 31, 2022, compared to the three months ended December 31, 2021, primarily due to higher crude oil prices, partially offset by lower sales volumes in the oil and gas segment.

Depreciation, depletion and amortization expenses decreased for the three months ended March 31, 2022, compared to the three months ended December 31, 2021, primarily as a result of lower production volumes and lower per Boe DD&A rates due to higher reported proved reserves as a result of positive price revisions.

The income tax benefit for the three months ended March 31, 2022, compared to an expense for the three months ended December 31, 2021, resulted primarily from the non-cash tax benefit associated with Occidental's legal entity reorganization. See Income Taxes section for further discussion.

Q1 2022 compared to Q1 2021

Net sales increased for the three months ended March 31, 2022, compared to the same period in 2021, primarily due to higher crude oil, NGL and natural gas prices in the oil and gas segment and higher realized prices and sales volumes across most chemical product lines.

Chemical and midstream cost of sales increased for the three months ended March 31, 2022, compared to the same period in 2021, primarily driven by higher raw material costs in the chemical segment and increased power generation costs related to the midstream and marketing segment.

Purchased commodities increased for the three months ended March 31, 2022, compared to the same period in 2021, due to higher prices on third-party crude purchases related to the midstream and marketing segment.

Depreciation, depletion and amortization expenses decreased for the three months ended March 31, 2022, compared to the same period of 2021, primarily as a result of lower per Boe DD&A rates due to higher reported proved reserves as a result of positive price revisions.

Gains on interest rate swaps, net, decreased for the three months ended March 31, 2022, compared to the same period in 2021, primarily as a result of two interest rates swap tranches having settled during the third quarter of 2021 and thus no longer marked to market.

The income tax benefit for the three months ended March 31, 2022, compared to an expense for the same period in 2021, resulted primarily from the non-cash tax benefit associated with Occidental's legal entity reorganization. See Income Taxes section for further discussion.

SEGMENT RESULTS OF OPERATIONS

Occidental’s principal businesses consist of three reporting segments: oil and gas, chemical and midstream and marketing. The oil and gas segment explores for, develops and produces oil and condensate, NGL and natural gas. The chemical segment mainly manufactures and markets basic chemicals and vinyls. The midstream and marketing segment purchases, markets, gathers, processes, transports and stores oil (which includes condensate), NGL, natural gas, CO2 and power. It also optimizes its transportation and storage capacity, and invests in entities that conduct similar activities such as WES.

The following table sets forth the sales and earnings of each operating segment and corporate items for the three months ended March 31, 2022, December 31, 2021 and March 31, 2021:

(a) Intersegment sales eliminate upon consolidation and are generally made at prices approximating those that the selling entity would be able to obtain in third-party transactions.

(b) Please refer to the Items Affecting Comparability table.

ITEMS AFFECTING COMPARABILITY

The following table sets forth items affecting the comparability of Occidental's earnings that vary widely and unpredictably in nature, timing and amount:

(a) Included in discontinued operations, net of taxes for the first quarter and fourth quarters of 2021 were the results of Ghana and a loss contingency associated with Occidental's former operations in Ecuador, see Note 10 - Lawsuits, Claims, Commitments and Contingencies.

OIL AND GAS SEGMENT

The following table sets forth the average sales volumes per day for oil and NGL in Mbbl and for natural gas in MMcf:

(a) Natural gas volumes have been converted to Boe based on energy content of six Mcf of gas to one barrel of oil. Barrels of oil equivalent does not necessarily result in price equivalency.

(b) Operations exited or exiting consisted of Ghana.

The following table presents information about Occidental's average realized prices and index prices:

Q1 2022 compared to Q4 2021

Oil and gas segment income was $2.9 billion for the three months ended March 31, 2022, compared with segment income of $2.1 billion for the three months ended December 31, 2021. Excluding the impact of asset impairments and other charges and oil, gas and CO2 derivative gains (losses), oil and gas segment results for the three months ended March 31, 2022, compared to the three months ended December 31, 2021, reflected higher oil prices and lower DD&A rates, partially offset by lower sales volumes.

The decrease in average daily sales volumes from continuing operations of 119 Mboe/d for the three months ended March 31, 2022, compared to the three months ended December 31, 2021, primarily reflected the impact of the first full shut down of the Al Hosn Gas Plant to allow for tie in work for the expansion project, scheduled maintenance in Algeria, declines in domestic volumes as a result of reduced capital investment in the DJ Basin and Permian Basin and the impact of rising prices that reduce Occidental's share of production under production sharing contracts.

Q1 2022 compared to Q1 2021

Oil and gas segment income was $2.9 billion for the three months ended March 31, 2022, compared with segment losses of $62 million for the three months ended March 31, 2021. Excluding the impact of asset impairments and other charges and oil, gas and CO2 derivative gains (losses), oil and gas segment results for the three months ended March 31, 2022, compared to the three months ended March 31, 2021, reflected higher commodity prices and lower DD&A rates, partially offset by lower sales volumes and higher lease operating and transportation costs.

The decrease in average daily sales volumes from continuing operations of 67 Mboe/d for the three months ended March 31, 2022, compared to the same period in 2021, primarily reflected the impact of the first full shutdown of the Al Hosn Gas Plant to allow for tie in work for the expansion project, scheduled maintenance in Algeria and the impact of rising prices that reduce Occidental's share of production under production sharing contracts.

CHEMICAL SEGMENT

Q1 2022 compared to Q4 2021

Chemical segment earnings for the three months ended March 31, 2022 were $671 million, compared to $574 million for the three months ended December 31, 2021. The improvement in results was primarily driven by higher realized pricing and margins across most product lines along with continued strong product demand.

Q1 2022 compared to Q1 2021

Chemical segment earnings for the three months ended March 31, 2022 were $671 million, compared to $251 million for the three months ended March 31, 2021. The improvement in results was primarily due to significantly higher realized pricing, volumes, and margins across most product lines. In February 2021, winter storm Uri interrupted production and sales across multiple facilities and increased costs of raw materials.

MIDSTREAM AND MARKETING SEGMENT

Q1 2022 compared to Q4 2021

Midstream and marketing segment losses for the three months ended March 31, 2022 were $50 million, compared with losses of $15 million for the three months ended December 31, 2021. Excluding the impact of derivative losses and impairment charges, segment results improved as crude pricing continued to rise in the first quarter of 2022.

Q1 2022 compared to Q1 2021

Midstream and marketing segment losses for the three months ended March 31, 2022 were $50 million, compared with earnings of $282 million for the three months ended 2021. Excluding the impact of derivative accounting and gains on sales of assets, the decrease in midstream and marketing segment results was primarily driven by the timing impact of crude export sales when compared to the current period.

The following table sets forth the calculation of the worldwide effective tax rate for income from continuing operations:

Occidental estimates its annual effective income tax rate in recording its quarterly provision for income taxes in the various jurisdictions in which the Company operates, adjusted for certain discrete items. Each quarter, Occidental updates these rates and records a cumulative adjustment to its income taxes by applying the rates to the pre-tax income excluding certain discrete items. Occidental’s quarterly estimate of its effective tax rates can vary significantly based on various forecasted items, including future commodity prices, capital expenditures, expenses for which tax benefits are not recognized and the geographic mix of pre-tax income and losses. The difference between the negative 58% effective tax rate for income from continuing operations for the three months ended March 31, 2022, and the 21% U.S. federal statutory tax rate was primarily driven by a non-cash tax benefit associated with Occidental's legal entity reorganization, as further described below, partially offset by higher tax rates in the foreign jurisdictions in which Occidental operates.

LEGAL ENTITY REORGANIZATION

To align Occidental’s legal entity structure with the nature of its business activities after completing the acquisition of Anadarko and subsequent large scale post-Acquisition divestiture program, management undertook a legal entity reorganization that was completed in the first quarter of 2022.

As a result of this legal entity reorganization, management made an adjustment to the tax basis in a portion of its operating assets, thus reducing Occidental’s deferred tax liabilities. Accordingly, in the first quarter of 2022, Occidental recorded an estimated non-cash tax benefit of $2.6 billion in connection with this reorganization. The timing of any reduction in Occidental’s future cash taxes as a result of this legal entity reorganization will be dependent on a number of factors, including prevailing commodity prices, capital activity level and production mix. Further refinement of the non-cash tax benefit may be necessary as Occidental finalizes its tax basis calculations, its tax returns and other information.

As of March 31, 2022, Occidental had $1.9 billion in cash and cash equivalents.

Operating cash flow from continuing operations was $3.2 billion for the three months ended March 31, 2022, compared to $788 million for the three months ended March 31, 2021. The increase in operating cash flow from continuing operations was primarily due to higher commodity prices as compared to the same period in 2021.

Occidental’s net cash used by investing activities from continuing operations was $662 million for the three months ended March 31, 2022, compared to $273 million for the three months ended March 31, 2021. Capital expenditures, of which substantially all were for the oil and gas segment, were approximately $858 million for the three months ended March 31, 2022, compared to $579 million for the three months ended March 31, 2021. Additionally, for the three months ended March 31, 2021, $496 million from proceeds from sales of assets, net primarily included the divestiture of non-operated assets in the DJ Basin as well as the sale of WES units.

Occidental’s net cash used by financing activities from continuing operations was $3.4 billion for the three months ended March 31, 2022, compared to $352 million for the three months ended March 31, 2021. Cash used by financing activities for the three months ended March 31, 2022 reflected the payments of $3.3 billion relating to long-term debt and dividend payments of $216 million on preferred and common stock. See Note 5 - Long-Term Debt in the notes to the Consolidated

Condensed Financial Statements in Part I, Item 1 of this Form 10-Q for additional information regarding debt payments, including payments subsequent to March 31, 2022. Cash used by financing activities for the three months ended March 31, 2021 reflected the dividend payments of $211 million on preferred and common stock and payments on current maturities of long-term debt of $174 million.

As of March 31, 2022, and as of the date of this filing, Occidental was in compliance with all covenants in its financing agreements. Occidental currently expects its cash on hand and funds available under its RCF to be sufficient to meet its near-term debt maturities, operating expenditures and other obligations for the next 12 months from the date of this filing.

For information regarding upcoming debt maturities and other near-term obligations see the Current Business Outlook section of the Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Occidental’s operations are subject to stringent federal, regional, state, provincial, tribal, local and international laws and regulations related to improving or maintaining environmental quality. Occidental’s environmental compliance costs have generally increased over time and are expected to rise in the future. Occidental factors environmental expenditures for its operations as an integral part of its business planning process.

The laws that require or address environmental remediation, including CERCLA and similar federal, regional, state, provincial, tribal, local and international laws, may apply retroactively and regardless of fault, the legality of the original activities or the current ownership or control of sites. Occidental or certain of its subsidiaries participate in or actively monitor a range of remedial activities and government or private proceedings under these laws with respect to alleged past practices at operating, closed and third-party sites. Remedial activities may include one or more of the following: investigation involving sampling, modeling, risk assessment or monitoring; cleanup measures including removal, treatment or disposal; or operation and maintenance of remedial systems. The environmental proceedings seek funding or performance of remediation and, in some cases, compensation for alleged property damage, punitive damages, civil penalties, injunctive relief and government oversight costs.

See Note 9 - Environmental Liabilities and Expenditures in the notes to the Consolidated Condensed Financial Statements in Part I, Item 1 of this Form 10-Q and the Environmental Liabilities and Expenditures section of Management’s Discussion and Analysis of Financial Condition and Results of Operations in the 2021 Form 10-K for additional information regarding Occidental’s environmental liabilities and expenditures.

Occidental accrues reserves for outstanding lawsuits, claims and proceedings when it is probable that a liability has been incurred and the liability can be reasonably estimated. Occidental has disclosed its reserve balances for environmental remediation matters and its estimated range of reasonably possible additional losses for such matters. See Note 10 - Lawsuits, Claims, Commitments and Contingencies, in the notes to Consolidated Condensed Financial Statements in Part I, Item 1 of this Form 10-Q for further information.

For the three months ended March 31, 2022, there were no material changes in the information required to be provided under Item 305 of Regulation S-K included under Item 7A, Quantitative and Qualitative Disclosures About Market Risk in the 2021 Form 10-K.

Occidental's President and Chief Executive Officer and its Senior Vice President and Chief Financial Officer supervised and participated in Occidental's evaluation of the effectiveness of its disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934) as of the end of the period covered by this report. Based upon that evaluation, Occidental's President and Chief Executive Officer and Senior Vice President and Chief Financial Officer concluded that Occidental's disclosure controls and procedures were effective as of March 31, 2022.

During the three months ended March 31, 2022, Occidental converted its legacy Anadarko's information into Occidental's primary enterprise resource planning system. Certain existing internal controls were modified and new controls were implemented. This conversion affected Occidental's internal control over financial reporting. There has been no change in Occidental’s internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the first quarter of 2022 that has materially affected, or is reasonably likely to materially affect, Occidental’s internal control over financial reporting other than the system conversion.

Part II Other Information

Item 1. Legal Proceedings

Occidental has elected to use a $1 million threshold for disclosing certain proceedings arising under federal, state or local environmental laws when a governmental authority is a party. Occidental believes proceedings under this threshold are not material to Occidental's business and financial condition. Applying this threshold, there are no such proceedings to disclose for the quarter ended March 31, 2022. For information regarding other legal proceedings, see Note - 10 Lawsuits, Claims, Commitments and Contingencies in the Notes to Consolidated Condensed Financial Statements in Part I, Item 1 of this Form 10-Q.

There have been no material changes from the risk factors included under Part I, Item 1A of Occidental’s Annual Report on Form 10-K for the year ended December 31, 2021.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Occidental’s share repurchase activities for the three months ended March 31, 2022, were as follows:

(a) Represents purchases from the trustee of Occidental's defined contribution savings plan that are not part of publicly announced plans or programs.

(b) Represents the value of shares remaining in Occidental's share repurchase plan. In February 2022, Occidental announced an authorization to repurchase up to $3 billion of Occidental's shares. The program does not obligate Occidental to acquire any specific number of shares and may be discontinued at any time.

Indicates a management contract or compensatory plan or arrangement.

• Filed herewith.

** Furnished herewith.

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.