OCCIDENTAL PETROLEUM CORP /DE/OXY

OCCIDENTAL PETROLEUM CORP /DE/ Leases Disclosure

10-KFiled Feb 18, 20262 min read
NOTE 6 - LEASE COMMITMENTS

Lease assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. Lease assets include the discounted value of future lease payments, upfront payments and costs incurred to execute the lease and are amortized on a straight-line basis over the lease term. The Company assesses the likelihood of exercising renewal, termination and purchase options to determine the lease term. The Company uses its incremental borrowing rate at commencement date to determine the present value of lease payments. The Company separates lease and non-lease components for drilling rigs and vessels. The Company does not separate lease and non-lease components for the remainder of asset classes as the non-lease portions are not significant.
The Company has operating leases from continuing operations for drilling rigs of $273 million, office space of $251 million, vessels of $191 million, compressors of $130 million and $110 million of other assets. Operating leases related to discontinued operations of $211 million are included in liabilities held for sale.
The Company’s finance leases from continuing operations include compressors of $428 million, assets related to DAC operations of $292 million, office space of $208 million and $71 million of other assets. Finance leases related to discontinued operations of $47 million are included in liabilities held for sale. Property, plant and equipment included $972 million of finance lease assets as of December 31, 2025.
The following summarizes maturities of lease liabilities related to continuing operations as of December 31, 2025:

millions
Operating Leases (a)
Finance Leases (b)
Total
2026$387 $248 $635 
2027289 226 515 
2028190 188 378 
202958 152 210 
203044 136 180 
Thereafter68 226 294 
Total lease payments1,036 1,176 2,212 
Less: Discount(81)(177)(258)
Total lease liabilities$955 $999 $1,954 
(a)The weighted-average remaining lease term is 3.5 years and the weighted-average discount rate is 4.94%.
(b)The weighted-average remaining lease term is 5 years and the weighted-average discount rate is 5.07%.

The following tables present the Company’s total lease cost and other information for operating and finance lease liabilities related to continuing operations for the years ended December 31:

millions20252024
Lease Cost
Finance lease cost:
Amortization of right-of-use assets$188 $152 
Interest on lease liabilities40 36 
Operating lease cost486 459 
Short-term lease cost384 342 
Total lease cost$1,098 $989 
millions20252024
Cash payments related to leases
Operating cash flows from finance leases$40 $34 
Operating cash flows from operating leases$295 $240 
Investing cash flows from operating leases$192 $209 
Financing cash flows from finance leases$177 $137 
Changes in Right-of-Use assets
Right-of-use assets obtained in relation to new finance lease liabilities $395 $195 
Right-of-use assets obtained in relation to new operating lease liabilities $617 $280 

Historical Timeline

Fiscal YearFiled
2025Feb 18, 2026Showing above
2024Feb 18, 2025
2023Feb 14, 2024
2022Feb 27, 2023
2021Feb 24, 2022
2020Feb 26, 2021
2019Feb 28, 2020
2018Feb 21, 2019
2017Feb 23, 2018
2016Feb 23, 2017
2015Feb 26, 2016

About Leases Disclosures

Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.

Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.

Other Available Disclosures

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