2025-06-13-Jefferies-加利福尼亚资源公司（CRC）_基洼评论-石油许可_碳捕集与封存及弹性_7页_104kb

Kiawah Commentary Summary - Oil Permitting, CCS, & Resiliency

Core Content

This commentary provides an analysis of California Resources Corp (CRC) from Jefferies analysts, focusing on the company's strategic direction in a low-price oil environment, its progress in oil permitting, and its CCS (Carbon Capture and Storage) business development. The report also includes a buy rating with a price target and valuation methodology.

Main Points

1. Navigating a Low-Price Environment

• Production Characteristics: CRC's production is in low decline and has low capital intensity, making it well-positioned for lower oil prices in 2025.
• Hedging Strategy: CRC is approximately 70% hedged for oil in 2025 and over 50% hedged in 2026, which helps to secure cash flow.
• Financial Position: CRC maintains a low leverage ratio (~0.7x) and prioritizes debt reduction, with the 2026 notes next in line.
• Cash Flow Utilization: Buybacks are a key use of cash, with no other debt maturities until 2029.
• Investment Opportunities: Inorganic growth opportunities remain a possibility.

2. Oil Permitting in California

• Permitting Progress: CRC has all necessary permits in place for 2025 and is progressing on permits for 2026 and beyond.
• Regulatory Outlook: CRC is optimistic about the regulatory environment due to Governor Newsom's directive for the CEC to engage more collaboratively with the oil and gas industry.
• Litigation and EIR: The Kern County EIR case is ongoing, but the county is expected to adopt a revised EIR later in 2025 to address deficiencies.
• CUP Permits: CRC expects CUP and Multi Basin drill permits to be finalized in 2H25.
• Support for In-State Production: There is increasing support for boosting in-state oil production, which is positive for CRC.

3. CCS Business Development

• CTV I 26-R: CRC plans to begin construction in Q2 2025 and expects start-up by year-end 2025.
• Class VI Permitting: CRC has 6-7 Class VI well projects pending EPA approval over the next 18 months.
• PPA Opportunities: CRC is in active negotiations with multiple industrial and data center customers for long-term PPAs, with contracts expected to finalize in 2025.
• Power Utilization: At Elk Hills, CRC is targeting a 200-250MW PPA, leveraging the unused power capacity (~2/3).
• Legislative Support: Assembly Bill 881, which supports in-state CCS transportation, passed the Assembly and is now in the Senate, potentially effective January 1, 2026.
• Project Economics: The CalCapture project's economics are supported by 45Q, LCFS, and carbon tax avoidance.

Key Information

• Investor Focus: Investors are closely following CRC's ability to maintain production in a low-price environment and its progress in securing permits for both oil and CCS projects.
• Strategic Emphasis: CRC is emphasizing the potential of its CCS business as a growth driver, with a focus on demonstrating its capabilities through smaller projects before scaling up.
• Risks: Several risks are identified, including regulatory challenges, uncertainty around CCS costs and incentives, and the potential for the Brookfield JV to opt out of CCS projects.
• Valuation: CRC is valued using multiple methodologies, including EV/EBITDA, SOTP, NAV, and DCF, with a price target of $59.00 (+28% from current price of $46.26).
• Investment Recommendation: CRC is rated "BUY" by Jefferies analysts, based on its competitive breakeven economics, strategic hedging, and growth potential in the CCS sector.

Analysts and Contact Information

• Emma Schwartz - Equity Analyst
  Email: emma.schwartz@jefferies.com
  Phone: (212) 336-7254

• Lloyd Byrne - Equity Analyst
  Email: lloyd.byrne@jefferies.com
  Phone: (212) 323-7528

• John Edelman - Equity Analyst
  Email: Jedelman@jefferies.com
  Phone: (212) 336-7412

• Sam Burwell, CFA - Equity Analyst
  Email: sburwell@jefferies.com
  Phone: +1 (212) 284-2114

• Tara Bleustein - Equity Associate
  Email: tbleustein@jefferies.com
  Phone: +1 (212) 323-7595

Valuation Methodology

Jefferies uses a combination of methods to value CRC, including:

• EV / 2Y Forward EBITDA: Based on 2027E EBITDA and discounted to a 1Y forward price target at the cost of equity less the dividend yield.
• SOTP (Sum of the Parts): Evaluates the company's assets individually.
• NAV (Net Asset Value): Considers the intrinsic value of the company's assets.
• DCF (Discounted Cash Flow): Projects future cash flows and discounts them to present value.
• Other Metrics: Includes P/E, P/CF, P/FCF, and others.

Investment Recommendation

• Rating: BUY
• Price Target: $59.00 (+28% from current price)
• Current Price: $46.26
• Market Cap: $4.2B
• 52-Week High-Low: $60.41 - $30.97
• Float: 82.4%
• Average Daily Trading Volume: 41.16 MM shares

Risks to Consider

• Regulatory Uncertainty: California's regulatory environment could become more stringent, affecting permitting and operations.
• CCS Costs and Incentives: The long-term viability of CCS projects depends on current and future incentives such as 45Q, LCFS, and carbon tax avoidance.
• JV Participation: Brookfield's potential non-participation in CCS projects could impact CRC's projections.
• Macroeconomic Conditions: Declines in oil and gas prices or broader economic downturns could negatively affect earnings.
• Currency Risk: For investors in non-US currencies, exchange rate fluctuations could impact returns.

Disclaimer

• Conflict of Interest: Jefferies may have a conflict of interest due to its investment banking relationship with CRC.
• General Information: This report is not tailored to individual investors and should be considered as one of many factors in investment decisions.
• No Investment Advice: The report does not constitute investment advice and does not guarantee returns.
• Forward-Looking Statements: Opinions and estimates are based on current information and may change without notice.