While Big Oil has been hogging the limelight after beating expectations in fiscal-first-quarter earnings reports, there has been no less a positive impact on the earnings of the lower tier of oil companies due to higher crude oil prices this year. One in particular has caught my eye.
Los Angeles-based Occidental Petroleum
During the first quarter, oil and gas revenues rose by 25% over the year-ago quarter. Volume-wise, year-over-year sales grew to 728,000 barrels of oil equivalent per day (Boe/d) from 685,000 Boe/d, while production was ramped up to 730,000 from 701,000 Boe/d. Core business has grown impressively and this is a very good sign.
While Occidental is not known as a chemical company, the chemical segment of the business contributed a very substantial 20% to the revenues. In fact, earnings from this unit shot up by a fantastic 630%, to $219 million, when compared to the first quarter of 2010.
Actually, this development is not limited to this company. As Fool analyst David Lee Smith pointed out, ExxonMobil
With Chief Operating Officer Stephen Chazen slated to take over as CEO next month, Occidental will be in safe hands following the departure of the incumbent CEO, Ray Irani. To aggressively fund its expanding operations, the company has increased capital expenditures to $6.8 billion -- a whopping 62% rise from last year. Foolish investors should find a long-term winner in this stock.