0001609253-23-000040 | 10-Q | XBRL Viewer | California Resources Corp

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Condensed Consolidated Balance Sheets - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
CURRENT ASSETS
Cash and cash equivalents	$ 477	$ 307
Trade receivables	249	326
Inventories	64	60
Assets held for sale	13	5
Receivable from affiliate	30	33
Other current assets, net	139	133
Total current assets	972	864
PROPERTY, PLANT AND EQUIPMENT	3,266	3,228
Accumulated depreciation, depletion and amortization	(502)	(442)
Total property, plant and equipment, net	2,764	2,786
INVESTMENT IN UNCONSOLIDATED SUBSIDIARY	14	13
DEFERRED TAX ASSET	117	164
OTHER NONCURRENT ASSETS	133	140
TOTAL ASSETS	4,000	3,967
CURRENT LIABILITIES
Accounts payable	260	345
Liabilities associated with assets held for sale	5	5
Fair value of derivative contracts	154	246
Accrued liabilities	298	298
Total current liabilities	717	894
NONCURRENT LIABILITIES
Long-term debt, net	592	592
Asset retirement obligations	424	432
Other long-term liabilities	175	185
STOCKHOLDERS' EQUITY
Preferred stock (20,000,000 shares authorized at $0.01 par value) no shares outstanding at March 31, 2023 and December 31, 2022	0	0
Common stock (200,000,000 shares authorized at $0.01 par value) (83,429,182 and 83,406,002 shares issued; 70,549,158 and 71,949,742 shares outstanding at March 31, 2023 and December 31, 2022)	1	1
Treasury stock (12,880,024 shares held at cost at March 31, 2023 and 11,456,260 shares held at cost at December 31, 2022)	(520)	(461)
Additional paid-in capital	1,311	1,305
Retained earnings	1,219	938
Accumulated other comprehensive income	81	81
Total stockholders' equity	2,092	1,864
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 4,000	$ 3,967

EARNINGS PER SHARE (Tables)

3 Months Ended

Mar. 31, 2023

Earnings Per Share [Abstract]

Schedule of Calculation of Basic and Diluted EPS

The following table presents the calculation of basic and diluted EPS, for the three months ended March 31, 2023 and 2022:



	Three months ended March 31,
	2023		2022
	(in millions, except per-share amounts)
Numerator for Basic and Diluted EPS
Net income (loss)	$	301	$	(175)





Denominator for Basic EPS
Weighted-average shares	71.3		78.5

Potential Common Shares, if dilutive:
Warrants	0.5		—
Restricted Stock Units	0.9		—
Performance Stock Units	0.8		—

Denominator for Diluted EPS
Weighted-average shares	73.5		78.5

EPS
Basic	$	4.22	$	(2.23)
Diluted	$	4.09	$	(2.23)

Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share

The following table presents potentially dilutive weighted-average common shares which were excluded from the denominator for diluted EPS in the periods presented:



	Three months ended March 31,
	2023	2022
	(in millions)
Shares issuable upon exercise of warrants	—	4.3

Shares issuable upon settlement of RSUs	—	1.1
Shares issuable upon settlement of PSUs	—	1.0

Total antidilutive shares	—	6.4

DEBT - Narrative - Revolving Credit Facility (Details) - Line of Credit - USD ($) $ in Millions	Apr. 26, 2023	Mar. 31, 2023
Revolving Credit Facility
Debt instrument
Line of credit facility, maximum borrowing capacity		$ 602
Revolving Credit Facility \| Subsequent Event
Debt instrument
Line of credit facility, maximum borrowing capacity	$ 592
Borrowing base	1,200
Letters of Credit
Debt instrument
Line of credit facility, maximum borrowing capacity		$ 200
Letters of Credit \| Subsequent Event
Debt instrument
Line of credit facility, maximum borrowing capacity	$ 250

DIVESTITURES AND ACQUISITIONS (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Business Acquisition [Line Items]
Gain (loss) on disposition of business		$ 1
Other Acquisitions
Business Acquisition [Line Items]
Business combination, consideration transferred		17
Impairment recognized	$ 3
Disposal Group, Disposed of by Sale, Not Discontinued Operations \| Ventura Basin
Business Acquisition [Line Items]
Gain on sale of assets		6
Disposal Group, Disposed of by Sale, Not Discontinued Operations \| Lost Hills, San Joaquin Basin
Business Acquisition [Line Items]
Gain on sale of assets		$ 49
Joint venture working interest acquired		50.00%
Option retained to capture carbon emissions, percent		100.00%
Percent of deep rights and related seismic data retained		100.00%
Disposal Group, Disposed of by Sale, Not Discontinued Operations \| Other Divestitures
Business Acquisition [Line Items]
Gain (loss) on disposition of business	$ (7)

INCOME TAXES - Narrative (Details) $ in Millions	Mar. 31, 2022 USD ($)
Income Tax Disclosure [Abstract]
Deferred tax assets, valuation allowance	$ 35

Cover	3 Months Ended
Cover	Mar. 31, 2023 shares
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2023
Document Transition Report	false
Entity File Number	001-36478
Entity Registrant Name	California Resources Corp
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	46-5670947
Entity Address, Address Line One	1 World Trade Center, Suite 1500
Entity Address, City or Town	Long Beach
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	90831
City Area Code	888
Local Phone Number	848-4754
Title of 12(b) Security	Common Stock
Trading Symbol	CRC
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Bankruptcy Proceedings, Reporting Current	true
Entity Common Stock, Shares Outstanding	70,549,158
Entity Central Index Key	0001609253
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q1
Amendment Flag	false

Condensed Consolidated Statements of Operations - USD ($) shares in Millions, $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
REVENUES
Oil, natural gas and NGL sales	$ 715	$ 628
Net gain (loss) from commodity derivatives	42	(562)
Total operating revenues	1,024	153
OPERATING EXPENSES
Operating costs	254	182
General and administrative expenses	65	48
Depreciation, depletion and amortization	58	49
Asset impairment	3	0
Taxes other than on income	42	34
Exploration expense	1	1
Accretion expense	12	11
Other operating expenses, net	13	14
Total operating expenses	638	396
Net gain on asset divestitures	7	54
OPERATING INCOME (LOSS)	393	(189)
NON-OPERATING (EXPENSES) INCOME
Interest and debt expense	(14)	(13)
Loss from investment in unconsolidated subsidiary	(2)	0
Other non-operating (expense) income	(1)	1
INCOME (LOSS) BEFORE INCOME TAXES	376	(201)
Income tax (provision) benefit	(75)	26
NET INCOME (LOSS)	$ 301	$ (175)
Net income (loss) per share
Basic (in dollars per share)	$ 4.22	$ (2.23)
Diluted (in dollars per share)	$ 4.09	$ (2.23)
Weighted-average common shares outstanding
Basic (in shares)	71.3	78.5
Diluted (in shares)	73.5	78.5
Sales of purchased natural gas
REVENUES
Revenue not from contract with customer	$ 184	$ 32
OPERATING EXPENSES
Costs of sales	124	21
Electricity sales
REVENUES
Revenue not from contract with customer	68	34
Other revenue
REVENUES
Revenue not from contract with customer	15	21
Electricity generation expenses
OPERATING EXPENSES
Costs of sales	49	24
Transportation costs
OPERATING EXPENSES
Costs of sales	$ 17	$ 12

SUPPLEMENTAL ACCOUNT BALANCES - Accrued Liabilities (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Accrued liabilities current [abstract]
Accrued employee-related costs	$ 40	$ 49
Accrued taxes other than on income	38	32
Asset retirement obligations	62	59
Accrued interest	9	19
Operating lease liability	14	18
Premiums due on derivative contracts	49	58
Liability for settlement payments on derivative contracts	23	33
Amounts due under production-sharing contracts	7	0
Income taxes payable	19	1
Other	37	29
Accrued liabilities	$ 298	$ 298

PENSION AND POSTRETIREMENT BENEFIT PLANS (Tables)

3 Months Ended

Mar. 31, 2023

Retirement Benefits [Abstract]

Schedule of Components of Net Periodic Benefit Costs

The following table sets forth the components of the net periodic benefit costs for our defined benefit pension and postretirement benefit plans for the three months ended March 31, 2023 and 2022:



	Three months ended March 31,				Three months ended March 31,
	2023				2022
	Pension Benefit		Postretirement Benefit		Pension Benefit		Postretirement Benefit
	(in millions)				(in millions)
Service cost - benefits earned during the period	$	—	$	—	$	—	$	1





Amortization of prior service cost credit	—		(1)		—		(1)
Net periodic benefit costs	$	—	$	(1)	$	—	$	—

SUPPLEMENTAL ACCOUNT BALANCES - Other Current Assets (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Other current assets
Net amounts due from joint interest partners	$ 39	$ 39
Fair value of derivative contracts	40	39
Prepaid expenses	16	17
Greenhouse gas allowances	19	0
Natural gas margin deposits	16	16
Income tax receivable	0	10
Other	9	12
Other current assets, net	139	133
Due from joint interest partners, allowances	$ 1	$ 1

DERIVATIVES - Commodity Price Risk (Details) - Crude Oil	Mar. 31, 2023 bbl / d $ / barrel
Calls \| Q2 2023
Derivatives
Daily volume \| bbl / d	17,837
Weighted-average price (in dollars per barrel) \| $ / barrel	60.00
Calls \| Q3 2023
Derivatives
Daily volume \| bbl / d	17,363
Weighted-average price (in dollars per barrel) \| $ / barrel	57.06
Calls \| Q4 2023
Derivatives
Daily volume \| bbl / d	5,747
Weighted-average price (in dollars per barrel) \| $ / barrel	57.06
Calls \| 1H 2024
Derivatives
Daily volume \| bbl / d	2,000
Weighted-average price (in dollars per barrel) \| $ / barrel	90.53
Calls \| 2H 2024
Derivatives
Daily volume \| bbl / d	4,000
Weighted-average price (in dollars per barrel) \| $ / barrel	90.53
Swaps \| Q2 2023
Derivatives
Daily volume \| bbl / d	19,475
Weighted-average price (in dollars per barrel) \| $ / barrel	70.48
Swaps \| Q3 2023
Derivatives
Daily volume \| bbl / d	17,697
Weighted-average price (in dollars per barrel) \| $ / barrel	69.27
Swaps \| Q4 2023
Derivatives
Daily volume \| bbl / d	27,094
Weighted-average price (in dollars per barrel) \| $ / barrel	70.73
Swaps \| 1H 2024
Derivatives
Daily volume \| bbl / d	3,500
Weighted-average price (in dollars per barrel) \| $ / barrel	78.79
Swaps \| 2H 2024
Derivatives
Daily volume \| bbl / d	1,000
Weighted-average price (in dollars per barrel) \| $ / barrel	77.20
Puts \| Purchased \| Q2 2023
Derivatives
Daily volume \| bbl / d	17,837
Weighted-average price (in dollars per barrel) \| $ / barrel	76.25
Puts \| Purchased \| Q3 2023
Derivatives
Daily volume \| bbl / d	17,363
Weighted-average price (in dollars per barrel) \| $ / barrel	76.25
Puts \| Purchased \| Q4 2023
Derivatives
Daily volume \| bbl / d	5,747
Weighted-average price (in dollars per barrel) \| $ / barrel	76.25
Puts \| Purchased \| 1H 2024
Derivatives
Daily volume \| bbl / d	5,467
Weighted-average price (in dollars per barrel) \| $ / barrel	71.80
Puts \| Purchased \| 2H 2024
Derivatives
Daily volume \| bbl / d	4,000
Weighted-average price (in dollars per barrel) \| $ / barrel	66.25

STOCKHOLDERS' EQUITY

3 Months Ended

Mar. 31, 2023

Equity [Abstract]

STOCKHOLDERS' EQUITY

Share Repurchase Program

Our Board of Directors has authorized a Share Repurchase Program to acquire up to $1.1 billion of our common stock through June 30, 2024. The repurchases may be effected from time-to-time through open market purchases, privately negotiated transactions, Rule 10b5-1 plans, accelerated stock repurchases, derivative contracts or otherwise in compliance with Rule 10b-18, subject to market conditions. The Share Repurchase Program does not obligate us to repurchase any dollar amount or number of shares and our Board of Directors may modify, suspend, or discontinue authorization of the program at any time. The following is a summary of our share repurchases, held as treasury stock for the periods presented:


	Total Number of Shares Purchased	Dollar Value of Shares Purchased		Average Price Paid per Share
	(number of shares)	(in millions)		($ per share)
Three months ended March 31, 2022	1,668,456	$	71	$	42.52
Three months ended March 31, 2023	1,423,764	$	59	$	41.25

Inception of Program (May 2021) through March 31, 2023	12,880,024	$	519	$	40.31

Note: The dollar value of shares purchased does not include commissions and excise taxes on share repurchases.

Dividends

On February 23, 2023, our Board of Directors declared a quarterly cash dividend of $0.2825 per share of common stock and amounted to $20 million in the aggregate. The dividend was payable to shareholders of record at the close of business on March 6, 2023 and was paid on March 16, 2023.

Future cash dividends, and the establishment of record and payment dates, are subject to final determination by our Board of Directors each quarter after reviewing our financial performance and position. See Note 14 Subsequent Events for information on future cash dividends.

Warrants

In October 2020, we reserved an aggregate 4,384,182 shares of our common stock for warrants which are exercisable at $36 per share through October 26, 2024.

As of March 31, 2023, we had outstanding warrants exercisable into 4,295,321 shares of our common stock (subject to adjustments pursuant to the terms of the warrants). During the three months ended March 31, 2023 and 2022, we issued an insignificant amount of shares of our common stock in exchange for warrants.

See Part II, Item 8 – Financial Statements and Supplementary Data, Note 11 Stockholders' Equity in our 2022 Annual Report for additional information on the terms of our warrants.

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

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+ Details

SUBSEQUENT EVENTS (Details) - USD ($) $ / shares in Units, $ in Millions				3 Months Ended
	Apr. 28, 2023	Apr. 26, 2023	Feb. 23, 2022	Mar. 31, 2023	Mar. 31, 2022
Subsequent Event [Line Items]
Dividends declared, common stock (in dollars per share)			$ 0.2825	$ 0.2825	$ 0.17
Subsequent Event \| Quarterly Dividend
Subsequent Event [Line Items]
Dividends declared, common stock (in dollars per share)	$ 0.2825
Revolving Credit Facility \| Line of Credit
Subsequent Event [Line Items]
Line of credit facility, maximum borrowing capacity				$ 602
Period to enter into hedges on production				48 months
Revolving Credit Facility \| Line of Credit \| SOFR \| Minimum
Subsequent Event [Line Items]
Interest rate added to variable rate basis				3.00%
Revolving Credit Facility \| Line of Credit \| SOFR \| Maximum
Subsequent Event [Line Items]
Interest rate added to variable rate basis				4.00%
Revolving Credit Facility \| Line of Credit \| Subsequent Event
Subsequent Event [Line Items]
Line of credit facility, maximum borrowing capacity		$ 592
Borrowing base		$ 1,200
Period to enter into hedges on production		60 months
Revolving Credit Facility \| Line of Credit \| Subsequent Event \| Minimum
Subsequent Event [Line Items]
Line of credit facility, unused capacity, commitment fee percentage		0.375%
Revolving Credit Facility \| Line of Credit \| Subsequent Event \| Maximum
Subsequent Event [Line Items]
Line of credit facility, unused capacity, commitment fee percentage		0.50%
Revolving Credit Facility \| Line of Credit \| Subsequent Event \| Federal Funds Rate
Subsequent Event [Line Items]
Interest rate added to variable rate basis		0.50%
Revolving Credit Facility \| Line of Credit \| Subsequent Event \| SOFR
Subsequent Event [Line Items]
Interest rate added to variable rate basis		1.00%
Revolving Credit Facility \| Line of Credit \| Subsequent Event \| Credit Spread Adjustment
Subsequent Event [Line Items]
Interest rate added to variable rate basis		0.10%
Revolving Credit Facility \| Line of Credit \| Subsequent Event \| ABR Applicable Margin \| Minimum
Subsequent Event [Line Items]
Interest rate added to variable rate basis		1.50%
Revolving Credit Facility \| Line of Credit \| Subsequent Event \| ABR Applicable Margin \| Maximum
Subsequent Event [Line Items]
Interest rate added to variable rate basis		2.50%
Revolving Credit Facility \| Line of Credit \| Subsequent Event \| Term SOFR Loans, Applicable Margin \| Minimum
Subsequent Event [Line Items]
Interest rate added to variable rate basis		2.50%
Revolving Credit Facility \| Line of Credit \| Subsequent Event \| Term SOFR Loans, Applicable Margin \| Maximum
Subsequent Event [Line Items]
Interest rate added to variable rate basis		3.50%
Letters of Credit \| Line of Credit
Subsequent Event [Line Items]
Line of credit facility, maximum borrowing capacity				$ 200
Letters of Credit \| Line of Credit \| Subsequent Event
Subsequent Event [Line Items]
Line of credit facility, maximum borrowing capacity		$ 250

DEBT (Tables)

3 Months Ended

Mar. 31, 2023

Debt Disclosure [Abstract]

Schedule of Long-term Debt

As of March 31, 2023 and December 31, 2022, our long-term debt consisted of the following:



	March 31,		December 31,
	2023		2022		Interest Rate	Maturity
	(in millions)

Revolving Credit Facility	$	—	$	—	SOFR plus 3%-4% ABR plus 2%-3%	April 29, 2024

Senior Notes	600		600		7.125%	February 1, 2026
Principal amount	$	600	$	600
Unamortized debt issuance costs	(8)		(8)
Long-term debt, net	$	592	$	592

- Definition

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

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+ Details

INVESTMENT IN UNCONSOLIDATED SUBSIDIARY AND RELATED PARTY TRANSACTIONS (Tables)

3 Months Ended

Mar. 31, 2023

Equity Method Investments and Joint Ventures [Abstract]

Schedule of Equity Method Investment Unconsolidated Subsidiary

The tables below present the summarized financial information related to our equity method investment and related party transactions for the periods presented.



	March 31,		December 31,
	2023		2022
	(in millions)
Investment in unconsolidated subsidiary(a)	$	14	$	13
Receivable from affiliate(b)	$	30	$	33
Property, plant and equipment(c)	$	1	$	—
Contingent liability related to Carbon TerraVault JV put and call rights(d)	$	49	$	48

(a)Reflects our investment less losses allocated to us of $2 million and $1 million for the three months ended March 31, 2023 and the year ended December 31, 2022, respectively.

(b)At March 31, 2023, the amount of $30 million includes $29 million which may be distributed to us or used to satisfy future capital calls and $1 million related to the MSA and vendor reimbursements. At December 31, 2022, the amount of $33 million includes $32 million which may be distributed to us or used to satisfy future capital calls and $1 million related to the MSA and vendor reimbursements.

(c)This amount includes the reimbursement for plugging and abandonment activities at the 26R reservoir.

(d)These amounts were included in other long-term liabilities on our condensed consolidated balance sheet. Our obligation includes $3 million and $2 million of accrued interest at March 31, 2023 and December 31, 2022, respectively, that we would be required to pay should Brookfield exercise its put right.


	Three months ended March 31,
	2023		2022
	(in millions)
Loss from investment in unconsolidated subsidiary	$	(2)	$	—
General and administrative expense(a)	$	1	$	—

(a)Includes amounts recognized by us under the MSA for administrative, operational and commercial services.

INCOME TAXES - Income Tax Expense (Benefit) (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Income Tax Disclosure [Abstract]
Net income (loss) before income taxes	$ 376	$ (201)
Current income tax provision	28	7
Deferred income tax provision (benefit)	47	(33)
Total income tax provision (benefit)	$ 75	$ (26)
Total income tax expense (benefit) differs from the U.S. federal income tax rate to pre-tax income (loss)
U.S. federal statutory tax rate	21.00%	21.00%
State income taxes, net	7.00%	7.00%
Change in the valuation allowance	(8.00%)	(15.00%)
Effective tax rate	20.00%	13.00%

SUPPLEMENTAL ACCOUNT BALANCES - General and Administrative Expenses (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Supplemental Information [Line Items]
General and administrative expenses	$ 65	$ 48
Exploration and production, corporate and other
Supplemental Information [Line Items]
General and administrative expenses	62	47
Carbon management business
Supplemental Information [Line Items]
General and administrative expenses	$ 3	$ 1

PENSION AND POSTRETIREMENT BENEFIT PLANS

3 Months Ended

Mar. 31, 2023

Retirement Benefits [Abstract]

PENSION AND POSTRETIREMENT BENEFIT PLANS

The following table sets forth the components of the net periodic benefit costs for our defined benefit pension and postretirement benefit plans for the three months ended March 31, 2023 and 2022:



	Three months ended March 31,				Three months ended March 31,
	2023				2022
	Pension Benefit		Postretirement Benefit		Pension Benefit		Postretirement Benefit
	(in millions)				(in millions)
Service cost - benefits earned during the period	$	—	$	—	$	—	$	1





Amortization of prior service cost credit	—		(1)		—		(1)
Net periodic benefit costs	$	—	$	(1)	$	—	$	—

We did not make contributions to our defined benefit plans during the three months ended March 31, 2023 and do not expect to make any additional contributions during the remainder of the year. During the three months ended March 31, 2022, we made contributions of approximately $1 million to our defined benefit plans.

- Definition

The entire disclosure for retirement benefits.

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+ Details

EARNINGS PER SHARE

3 Months Ended

Mar. 31, 2023

Earnings Per Share [Abstract]

EARNINGS PER SHARE

Basic and diluted earnings per share (EPS) were calculated using the treasury stock method for the three months ended March 31, 2023 and 2022. Our restricted stock unit (RSU) and performance stock unit (PSU) awards are not considered participating securities since the dividend rights on unvested shares are forfeitable.

For basic EPS, the weighted-average number of common shares outstanding excludes shares underlying our equity-settled awards and warrants. For diluted EPS, the basic shares outstanding are adjusted by adding potential common shares, if dilutive.

The following table presents the calculation of basic and diluted EPS, for the three months ended March 31, 2023 and 2022:



	Three months ended March 31,
	2023		2022
	(in millions, except per-share amounts)
Numerator for Basic and Diluted EPS
Net income (loss)	$	301	$	(175)





Denominator for Basic EPS
Weighted-average shares	71.3		78.5

Potential Common Shares, if dilutive:
Warrants	0.5		—
Restricted Stock Units	0.9		—
Performance Stock Units	0.8		—

Denominator for Diluted EPS
Weighted-average shares	73.5		78.5

EPS
Basic	$	4.22	$	(2.23)
Diluted	$	4.09	$	(2.23)

The following table presents potentially dilutive weighted-average common shares which were excluded from the denominator for diluted EPS in the periods presented:



	Three months ended March 31,
	2023	2022
	(in millions)
Shares issuable upon exercise of warrants	—	4.3

Shares issuable upon settlement of RSUs	—	1.1
Shares issuable upon settlement of PSUs	—	1.0

Total antidilutive shares	—	6.4

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
CASH FLOW FROM OPERATING ACTIVITIES
Net income (loss)	$ 301	$ (175)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation, depletion and amortization	58	49
Deferred income tax provision (benefit)	47	(33)
Asset impairment	3	0
Net (gain) loss from commodity derivatives	(42)	562
Net payments on settled commodity derivatives	(65)	(181)
Net gain on asset divestitures	(7)	(54)
Other non-cash charges to income, net	21	8
Changes in operating assets and liabilities, net	(6)	(16)
Net cash provided by operating activities	310	160
CASH FLOW FROM INVESTING ACTIVITIES
Capital investments	(47)	(99)
Changes in accrued capital investments	(13)	3
Proceeds from asset divestitures, net	0	60
Acquisitions	0	(17)
Other	(1)	0
Net cash used in investing activities	(61)	(53)
CASH FLOW FROM FINANCING ACTIVITIES
Repurchases of common stock	(59)	(71)
Common stock dividends	(20)	(13)
Issuance of common stock	1	0
Shares cancelled for taxes	(1)	0
Net cash used in financing activities	(79)	(84)
Increase in cash and cash equivalents	170	23
Cash and cash equivalents—beginning of period	307	305
Cash and cash equivalents—end of period	$ 477	$ 328

REVENUE (Tables)

3 Months Ended

Mar. 31, 2023

Revenue from Contract with Customer [Abstract]

Schedule of Disaggregated Revenue

The following table provides disaggregated revenue for sales of produced oil, natural gas and NGLs to customers:



	Three months ended March 31,
	2023		2022
	(in millions)
Oil	$	390	$	486
Natural gas	263		80
NGLs	62		62
Oil, natural gas and NGL sales	$	715	$	628

INVESTMENT IN UNCONSOLIDATED SUBSIDIARY AND RELATED PARTY TRANSACTIONS - Equity Method Investment Unconsolidated Subsidiary, Balance Sheet (Details) - USD ($) $ in Millions	3 Months Ended		12 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022
Schedule of Equity Method Investments [Line Items]
Investment in unconsolidated subsidiary	$ 14		$ 13
Receivable from affiliate	30		33
Property, plant and equipment	2,764		2,786
Contingent liability related to Carbon TerraVault JV put and call rights	49		48
Loss from investment in unconsolidated subsidiary	2	$ 0
Carbon TerraVault JV
Schedule of Equity Method Investments [Line Items]
Investment in unconsolidated subsidiary	14		13
Receivable from affiliate	30		33
Property, plant and equipment	1		0
Contingent liability related to Carbon TerraVault JV put and call rights	49		48
Loss from investment in unconsolidated subsidiary	2	$ 0	1
Equity method investments, distributed to satisfy future capital calls	29
Carbon TerraVault JV \| Brookfield
Schedule of Equity Method Investments [Line Items]
Accrued interest	3		2
Carbon TerraVault JV \| Management Services Agreement
Schedule of Equity Method Investments [Line Items]
Receivable from affiliate	$ 1		1
Equity method investments, distributed to satisfy future capital calls			$ 32

DEBT - Schedule of Long-Term Debt (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Dec. 31, 2022
Debt
Principal amount	$ 600	$ 600
Unamortized debt issuance costs	(8)	(8)
Long-term debt, net	592	592
Senior Notes (Unsecured)
Debt
Principal amount	$ 600	600
Interest rate	7.125%
Revolving Credit Facility \| Line of Credit
Debt
Principal amount	$ 0	$ 0
Revolving Credit Facility \| Line of Credit \| SOFR \| Minimum
Debt
Interest rate added to variable rate basis	3.00%
Revolving Credit Facility \| Line of Credit \| SOFR \| Maximum
Debt
Interest rate added to variable rate basis	4.00%
Revolving Credit Facility \| Line of Credit \| Alternative Base Rate \| Minimum
Debt
Interest rate added to variable rate basis	2.00%
Revolving Credit Facility \| Line of Credit \| Alternative Base Rate \| Maximum
Debt
Interest rate added to variable rate basis	3.00%

DEBT

3 Months Ended

Mar. 31, 2023

Debt Disclosure [Abstract]

DEBT

As of March 31, 2023 and December 31, 2022, our long-term debt consisted of the following:



	March 31,		December 31,
	2023		2022		Interest Rate	Maturity
	(in millions)

Revolving Credit Facility	$	—	$	—	SOFR plus 3%-4% ABR plus 2%-3%	April 29, 2024

Senior Notes	600		600		7.125%	February 1, 2026
Principal amount	$	600	$	600
Unamortized debt issuance costs	(8)		(8)
Long-term debt, net	$	592	$	592

On October 27, 2020, we entered into a Credit Agreement with Citibank, N.A., as administrative agent, and certain other lenders. As of March 31, 2023, this credit agreement consisted of a senior revolving loan facility (Revolving Credit Facility) with an aggregate commitment of $602 million. Our Revolving Credit Facility also included a sub-limit of $200 million for the issuance of letters of credit as of March 31, 2023. Letters of credit were issued to support ordinary course marketing, insurance, regulatory and other matters.

The borrowing base is redetermined semi-annually and was reaffirmed at $1.2 billion on April 26, 2023. The borrowing base takes into account the estimated value of our proved reserves, total indebtedness and other relevant factors consistent with customary reserves-based lending criteria. The amount we are able to borrow under our Revolving Credit Facility is limited to the amount of the commitment described above.

At March 31, 2023, we were in compliance with all financial and other debt covenants under our Revolving Credit Facility and Senior Notes. For more information on our Senior Notes, see Part II, Item 8 – Financial Statements and Supplementary Data, Note 4 Debt in our 2022 Annual Report. See Note 14 Subsequent Events for information regarding a recent amendment to our Revolving Credit Facility.

Fair Value

The estimated fair value of our fixed-rate debt at March 31, 2023 and December 31, 2022 was approximately $607 million and $574 million, respectively. We estimate fair value based on prices known from market transactions (using Level 1 inputs on the fair value hierarchy).

REVENUE - Disaggregation of Revenue (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Disaggregation of revenue
Oil, natural gas and NGL sales	$ 715	$ 628
Oil
Disaggregation of revenue
Oil, natural gas and NGL sales	390	486
Natural gas
Disaggregation of revenue
Oil, natural gas and NGL sales	263	80
NGLs
Disaggregation of revenue
Oil, natural gas and NGL sales	$ 62	$ 62

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

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+ Details

SUPPLEMENTAL ACCOUNT BALANCES - Other Long-Term Liabilities (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
SUPPLEMENTAL INFORMATION [Abstract]
Compensation-related liabilities	$ 38	$ 36
Postretirement and pension benefit plans	31	33
Operating lease liability	50	52
Premiums due on derivative contracts	0	8
Contingent liability related to Carbon TerraVault JV put and call rights	49	48
Other	7	8
Other long-term liabilities	$ 175	$ 185

- Definition

Portion of the carrying amount as of the balance sheet date of obligations due all related parties that is payable after one year or beyond the normal operating cycle if longer.

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+ Details

EARNINGS PER SHARE - Calculation of EPS (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Numerator for Basic and Diluted EPS
Net income (loss)	$ 301	$ (175)
Denominator for Basic EPS
Weighted-average common shares outstanding — basic (in shares)	71.3	78.5
Weighted-average common shares outstanding — diluted (in shares)	73.5	78.5
EPS
Basic (in dollars per share)	$ 4.22	$ (2.23)
Diluted (in dollars per share)	$ 4.09	$ (2.23)
Warrants
Potential Common Shares, if dilutive:
Incremental common shares attributable to dilutive effect of share-based payment arrangements (in shares)	0.5	0.0
Restricted Stock Units
Potential Common Shares, if dilutive:
Incremental common shares attributable to dilutive effect of share-based payment arrangements (in shares)	0.9	0.0
Performance Stock Units
Potential Common Shares, if dilutive:
Incremental common shares attributable to dilutive effect of share-based payment arrangements (in shares)	0.8	0.0

Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Millions	Total	Common Stock	Treasury Stock	Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Income
Beginning balance at Dec. 31, 2021	$ 1,688	$ 1	$ (148)	$ 1,288	$ 475	$ 72
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net (loss) income	(175)				(175)
Share-based compensation	5			5
Repurchases of common stock	(71)		(71)
Cash dividend	(14)				(14)
Ending balance at Mar. 31, 2022	1,433	1	(219)	1,293	286	72
Beginning balance at Dec. 31, 2022	1,864	1	(461)	1,305	938	81
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net (loss) income	301				301
Share-based compensation	7			7
Repurchases of common stock	(59)		(59)
Cash dividend	(20)				(20)
Shares cancelled for taxes	(1)			(1)
Ending balance at Mar. 31, 2023	$ 2,092	$ 1	$ (520)	$ 1,311	$ 1,219	$ 81

- Definition

Amount of stockholders' equity (deficit), net of receivables from officers, directors, owners, and affiliates of the entity, attributable to both the parent and noncontrolling interests. Amount excludes temporary equity. Alternate caption for the concept is permanent equity.

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+ Details

SUBSEQUENT EVENTS	3 Months Ended
SUBSEQUENT EVENTS	Mar. 31, 2023
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	SUBSEQUENT EVENTS Amendment to our Revolving Credit Facility On April 26, 2023, we amended our existing Revolving Credit Facility. The amended Revolving Credit Facility provides for an initial aggregate commitment of $592 million and a borrowing base of $1.2 billion. The amendments included, among other things: •extending the maturity date to July 31, 2027 (subject to a springing maturity to August 4, 2025 if any of our Senior Notes are outstanding on that date); •increasing our ability to make certain restricted payments (such as dividends and share repurchases) and certain investments (including in our carbon management business); •releasing liens on certain assets securing the loans made under the Revolving Credit Facility, including our Elk Hills power plant; •permitting us to designate the entities that hold certain of our assets, including our Elk Hills power plant, as unrestricted subsidiaries subject to meeting certain conditions; •extending the period for which we can enter into hedges on our production from 48 months to 60 months; and •increasing our capacity to issue letters of credit from $200 million to $250 million. We also amended the interest rates and fees we pay under our Revolving Credit Facility. At our election, borrowings under the amended Revolving Credit Facility may be alternate base rate (ABR) loans or term SOFR loans, plus an applicable margin. ABR loans bear interest at a rate equal to the highest of (i) the federal funds effective rate plus 0.50%, (ii) the administrative agent prime rate and (iii) the one-month SOFR rate plus 1%. Term SOFR loans bear interest at term SOFR, plus an additional 10 basis points per annum credit spread adjustment. The applicable margin is adjusted based on the commitment utilization percentage and will vary from (i) in the case of ABR loans, 1.50% to 2.50% and (ii) in the case of term SOFR loans, 2.50% to 3.50%. We also pay customary fees and expenses. Interest is payable quarterly for ABR loans and at the end of the applicable interest period for term SOFR loans, but not less than quarterly. We also pay a commitment fee on unused capacity ranging from 37.5 to 50 basis points per annum, depending on the percentage of the commitment utilized. Dividends On April 28, 2023, our Board of Directors declared a quarterly cash dividend of $0.2825 per share of common stock. The dividend is payable to shareholders of record at the close of business on June 1, 2023 and is expected to be paid on June 16, 2023.

INCOME TAXES

3 Months Ended

Mar. 31, 2023

Income Tax Disclosure [Abstract]

INCOME TAXES

The following table present the components of our total income tax provision and a reconciliation of the U.S. federal statutory rate to our effective tax rate:


	Three months ended March 31,
	2023		2022
	(in millions)
Net income (loss) before income taxes	$	376	$	(201)

Current income tax provision	28		7
Deferred income tax provision (benefit)	47		(33)
Total income tax provision (benefit)	$	75	$	(26)


	Three months ended March 31,
	2023		2022
U.S. federal statutory tax rate	21	%	21	%
State income taxes, net	7		7


Change in the valuation allowance	(8)		(15)

Effective tax rate	20	%	13	%

In the first quarter of 2022, we recognized a valuation allowance of $35 million for a portion of the tax loss on the sale of our Lost Hills assets, the deductibility of which was limited. We recognized the benefit of this tax loss in the first quarter of 2023 by releasing the valuation allowance after we jointly agreed to amend the original tax treatment with the buyer. Realization of our deferred tax assets is subjective and remains dependent on a number of factors including our ability to generate sufficient taxable income in future periods.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

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+ Details

DERIVATIVES (Tables)

3 Months Ended

Mar. 31, 2023

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Summary of Open Derivative Contracts

We held the following Brent-based crude oil contracts as of March 31, 2023:


	Q2 2023		Q3 2023		Q4 2023		1H 2024		2H 2024
Sold Calls
Barrels per day	17,837		17,363		5,747		2,000		4,000
Weighted-average price per barrel	$	60.00	$	57.06	$	57.06	$	90.53	$	90.53

Swaps
Barrels per day	19,475		17,697		27,094		3,500		1,000
Weighted-average price per barrel	$	70.48	$	69.27	$	70.73	$	78.79	$	77.20

Net Purchased Puts(a)
Barrels per day	17,837		17,363		5,747		5,467		4,000
Weighted-average price per barrel	$	76.25	$	76.25	$	76.25	$	71.80	$	66.25

(a)Purchased puts and sold puts with the same strike price have been presented on a net basis.

Summary of Fair Value of Derivatives

The following tables present the fair values on a recurring basis (at gross and net) of our outstanding commodity derivatives as of March 31, 2023 and December 31, 2022:


March 31, 2023
Classification	Gross Amounts at Fair Value		Netting		Net Fair Value
Assets	(in millions)
Other current assets - Fair value of derivative contracts	$	48	$	(8)	$	40
Other noncurrent assets - Fair value of derivative contracts	10		(7)		3

Liabilities
Current - Fair value of derivative contracts(a)	(162)		8		(154)
Noncurrent - Fair value of derivative contracts	(7)		7		—
	$	(111)	$	—	$	(111)

(a)In addition to our Brent based derivative contracts, we held swaps as of March 31, 2023 for offsetting notional volumes of natural gas to secure a margin for future physical sales of natural gas related to our marketing and trading activities. The fair value of these natural gas hedges was $15 million included in current liabilities at March 31, 2023.


December 31, 2022
Classification	Gross Amounts at Fair Value		Netting		Net Fair Value
Assets	(in millions)
Other current assets - Fair value of derivative contracts	$	51	$	(12)	$	39
Other noncurrent assets - Fair value of derivative contracts	7		—		7

Liabilities
Current - Fair value of derivative contracts(a)	(258)		12		(246)
Noncurrent - Fair value of derivative contracts	—		—		—
	$	(200)	$	—	$	(200)

(a)In addition to our Brent based derivative contracts, we held swaps as of December 31, 2022 for offsetting notional volumes of natural gas to secure a margin for future physical sales of natural gas related to our marketing and trading activities. The fair value of these natural gas hedges was $4 million included in current liabilities at December 31, 2022.

- Definition

Tabular disclosure of pertinent information about a derivative or group of derivatives on a disaggregated basis, such as for individual instruments, or small groups of similar instruments. May include a combination of the type of instrument, risks being hedged, notional amount, hedge designation, related hedged item, inception date, maturity date, or other relevant item.

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+ Details

EARNINGS PER SHARE - Potentially Dilutive Common Shares (Details) - shares	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total antidilutive shares	0	6,400,000
Shares issuable upon exercise of warrants
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total antidilutive shares	0	4,300,000
Shares issuable upon settlement of RSUs
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total antidilutive shares	0	1,100,000
Shares issuable upon settlement of PSUs
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total antidilutive shares	0	1,000,000.0

Condensed Consolidated Statements of Stockholders' Equity (Parenthetical) - $ / shares		3 Months Ended
	Feb. 23, 2022	Mar. 31, 2023	Mar. 31, 2022
Statement of Stockholders' Equity [Abstract]
Dividends declared, common stock (in dollars per share)	$ 0.2825	$ 0.2825	$ 0.17

PENSION AND POSTRETIREMENT BENEFIT PLANS (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Net periodic benefit costs:
Employer contributions to pension plan		$ 1
Pension Benefit
Net periodic benefit costs:
Service cost - benefits earned during the period	$ 0	0
Amortization of prior service cost credit	0	0
Net periodic benefit costs	0	0
Postretirement Benefit
Net periodic benefit costs:
Service cost - benefits earned during the period	0	1
Amortization of prior service cost credit	(1)	(1)
Net periodic benefit costs	$ (1)	$ 0

- Definition

Amount of contribution received by defined benefit plan from employer which increases plan assets.

+ References + Details

BASIS OF PRESENTATION	3 Months Ended
BASIS OF PRESENTATION	Mar. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
BASIS OF PRESENTATION	BASIS OF PRESENTATION We are an independent energy and carbon management company committed to energy transition. We produce some of the lowest carbon intensity oil in the United States and are focused on maximizing the value of our land, minerals and technical resources for decarbonization efforts. We are in the early stages of developing several carbon capture and storage (CCS) projects in California and other emissions reducing projects. Our subsidiary Carbon TerraVault is expected to build, install, operate and maintain CO2 capture equipment, transportation assets and storage facilities in California. In August 2022, Carbon TerraVault entered into a joint venture with BGTF Sierra Aggregator LLC (Brookfield) to pursue certain of these opportunities (Carbon TerraVault JV). See Note 2 Investment in Unconsolidated Subsidiary and Related Party Transactions for more information on the Carbon TerraVault JV. Separately, we are evaluating the feasibility of a carbon capture system to be located at our Elk Hills power plant. Except when the context otherwise requires or where otherwise indicated, all references to ‘‘CRC,’’ the ‘‘Company,’’ ‘‘we,’’ ‘‘us’’ and ‘‘our’’ refer to California Resources Corporation and its subsidiaries. In the opinion of our management, the accompanying unaudited financial statements contain all adjustments necessary to fairly present our financial position, results of operations, comprehensive income, equity and cash flows for all periods presented. We have eliminated all significant intercompany transactions and accounts. We account for our share of oil and natural gas producing activities, in which we have a direct working interest, by reporting our proportionate share of assets, liabilities, revenues, costs and cash flows within the relevant lines on our condensed consolidated financial statements. In applying the equity method of accounting for variable interest entities that we do not control, the investment is initially recognized at cost and then adjusted for our proportionate share of income or loss, contributions and distributions. We have prepared this report in accordance with generally accepted accounting principles (GAAP) in the United States and the rules and regulations of the U.S. Securities and Exchange Commission applicable to interim financial information which permit the omission of certain disclosures to the extent they have not changed materially since the latest annual financial statements. We believe our disclosures are adequate to make the information presented not misleading. The preparation of financial statements in conformity with GAAP requires management to select appropriate accounting policies and make informed estimates and judgments regarding certain types of financial statement balances and disclosures. Actual results could differ. Management believes that these estimates and judgments provide a reasonable basis for the fair presentation of our condensed consolidated financial statements. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto in our Annual Report on Form 10-K for the year ended December 31, 2022 (2022 Annual Report). The carrying amounts of cash, cash equivalents and on-balance sheet financial instruments, other than debt, approximate fair value. Refer to Note 3 Debt for the fair value of our debt.

DIVESTITURES AND ACQUISITIONS	3 Months Ended
DIVESTITURES AND ACQUISITIONS	Mar. 31, 2023
Acquisitions And Divestitures [Abstract]
DIVESTITURES AND ACQUISITIONS	DIVESTITURES AND ACQUISITIONS Divestitures Ventura Basin Transactions In the three months ended March 31, 2022, we recorded a gain of $6 million related to the sale of certain Ventura basin assets. The closing of the sale of our remaining assets in the Ventura basin is subject to final approval from the State Lands Commission, which we expect to receive in the second half of 2023. These remaining assets, consisting of property, plant and equipment and associated asset retirement obligations, are classified as held for sale on our condensed consolidated balance sheets at March 31, 2023 and December 31, 2022. See Part II, Item 8 – Financial Statements and Supplementary Data, Note 3 Divestitures and Acquisitions in our 2022 Annual Report for additional information on the Ventura basin transactions. Lost Hills Transaction During the three months ended March 31, 2022, we sold our 50% non-operated working interest in certain horizons within our Lost Hills field, located in the San Joaquin basin, recognizing a gain of $49 million. We retained an option to capture, transport and store 100% of the CO2 from steam generators across the Lost Hills field for future carbon management projects. We also retained 100% of the deep rights and related seismic data. Other During the three months ended March 31, 2023, we sold a non-core asset in exchange for the assumption of plugging and abandonment liabilities recognizing a $7 million gain. During the three months ended March 31, 2022, we sold non-core assets recognizing a $1 million loss. AcquisitionsDuring the three months ended March 31, 2022, we acquired properties for carbon management activities for approximately $17 million. We are evaluating the sale of certain unwanted assets that were part of this acquisition and recognized an impairment of $3 million in the first quarter of 2023. The fair value of these assets, using Level 3 inputs in the fair value hierarchy, declined due to market conditions including inflation and rising interest rates. These assets are classified as held for sale as of March 31, 2023 on our condensed consolidated balance sheet.

REVENUE

3 Months Ended

Mar. 31, 2023

Revenue from Contract with Customer [Abstract]

REVENUE

We derive most of our revenue from sales of oil, natural gas and NGLs, with the remaining revenue primarily generated from sales of electricity and marketing activities related to storage and managing excess pipeline capacity.

The following table provides disaggregated revenue for sales of produced oil, natural gas and NGLs to customers:



	Three months ended March 31,
	2023		2022
	(in millions)
Oil	$	390	$	486
Natural gas	263		80
NGLs	62		62
Oil, natural gas and NGL sales	$	715	$	628

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-URI https://asc.fasb.org/topic&trid=49130388

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 10
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130551-203045

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (b)(2)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130556-203045

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130554-203045

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
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-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130550-203045

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (e)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130554-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130554-203045

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (d)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130554-203045

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 15
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130558-203045

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (c)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130554-203045

+ Details

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Mar. 31, 2023	Dec. 31, 2022
Statement of Financial Position [Abstract]
Preferred stock, authorized shares (in shares)	20,000,000	20,000,000
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, outstanding shares (in shares)	0	0
Common stock, authorized shares (in shares)	200,000,000	200,000,000
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, issued shares (in shares)	83,429,182	83,406,002
Common stock, outstanding shares (in shares)	70,549,158	71,949,742
Treasury stock (in shares)	12,880,024	11,456,260

INVESTMENT IN UNCONSOLIDATED SUBSIDIARY AND RELATED PARTY TRANSACTIONS - Narrative (Details) - Carbon TerraVault JV MT in Millions, $ in Millions		3 Months Ended
	Aug. 03, 2022 USD ($) installment MT	Mar. 31, 2023 USD ($)	Dec. 31, 2022 USD ($)
Schedule of Equity Method Investments [Line Items]
Interest in joint venture	51.00%
Contribution from noncontrolling interest			$ 12
Brookfield
Schedule of Equity Method Investments [Line Items]
Interest in joint venture	49.00%
Committed amount	$ 500
Initial investment	$ 137
Number of installments \| installment	3
Number of installments subject to certain milestones \| installment	2
Contribution from noncontrolling interest			46
Metric tons of carbon per annum \| MT	5
Brookfield \| Calls
Schedule of Equity Method Investments [Line Items]
Contribution from noncontrolling interest		$ 2	$ 2

DERIVATIVES - Fair Value (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Fair Value of Derivatives
Derivative instruments in hedges liabilities at fair value	$ 15	$ 4
Commodity Contracts
Fair Value of Derivatives
Total derivatives	0	0
Commodity Contracts \| Other current assets - Fair value of derivative contracts
Fair Value of Derivatives
Netting	(8)	(12)
Commodity Contracts \| Other noncurrent assets - Fair value of derivative contracts
Fair Value of Derivatives
Netting	(7)	0
Commodity Contracts \| Current - Fair value of derivative contracts(a)
Fair Value of Derivatives
Netting	8	12
Commodity Contracts \| Noncurrent - Fair value of derivative contracts
Fair Value of Derivatives
Netting	7	0
Gross Amounts at Fair Value \| Commodity Contracts
Fair Value of Derivatives
Total derivatives	(111)	(200)
Gross Amounts at Fair Value \| Commodity Contracts \| Other current assets - Fair value of derivative contracts
Fair Value of Derivatives
Gross Amounts at Fair Value	48	51
Gross Amounts at Fair Value \| Commodity Contracts \| Other noncurrent assets - Fair value of derivative contracts
Fair Value of Derivatives
Gross Amounts at Fair Value	10	7
Gross Amounts at Fair Value \| Commodity Contracts \| Current - Fair value of derivative contracts(a)
Fair Value of Derivatives
Gross Amounts at Fair Value	(162)	(258)
Gross Amounts at Fair Value \| Commodity Contracts \| Noncurrent - Fair value of derivative contracts
Fair Value of Derivatives
Gross Amounts at Fair Value	(7)	0
Net Fair Value \| Commodity Contracts
Fair Value of Derivatives
Total derivatives	(111)	(200)
Net Fair Value \| Commodity Contracts \| Other current assets - Fair value of derivative contracts
Fair Value of Derivatives
Net Fair Value	40	39
Net Fair Value \| Commodity Contracts \| Other noncurrent assets - Fair value of derivative contracts
Fair Value of Derivatives
Net Fair Value	3	7
Net Fair Value \| Commodity Contracts \| Current - Fair value of derivative contracts(a)
Fair Value of Derivatives
Net Fair Value	(154)	(246)
Net Fair Value \| Commodity Contracts \| Noncurrent - Fair value of derivative contracts
Fair Value of Derivatives
Net Fair Value	$ 0	$ 0

STOCKHOLDERS' EQUITY - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions			3 Months Ended
	Mar. 16, 2023	Feb. 23, 2022	Mar. 31, 2023	Mar. 31, 2022	Oct. 31, 2020
Equity [Abstract]
Stock repurchase program authorized amount			$ 1,100
Dividends declared, common stock (in dollars per share)		$ 0.2825	$ 0.2825	$ 0.17
Dividends paid	$ 20
Shares reserved for future issuance (in shares)					4,384,182
Investment warrants, exercise price (in dollars per share)					$ 36
Warrant outstanding (in shares)			4,295,321

INCOME TAXES (Tables)

3 Months Ended

Mar. 31, 2023

Income Tax Disclosure [Abstract]

Schedule of differences between the U.S. federal income tax rate and the company's effective tax rate

The following table present the components of our total income tax provision and a reconciliation of the U.S. federal statutory rate to our effective tax rate:


	Three months ended March 31,
	2023		2022
	(in millions)
Net income (loss) before income taxes	$	376	$	(201)

Current income tax provision	28		7
Deferred income tax provision (benefit)	47		(33)
Total income tax provision (benefit)	$	75	$	(26)


	Three months ended March 31,
	2023		2022
U.S. federal statutory tax rate	21	%	21	%
State income taxes, net	7		7


Change in the valuation allowance	(8)		(15)

Effective tax rate	20	%	13	%

SUPPLEMENTAL CASH FLOW INFORMATION (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Supplemental Cash Flow Elements [Line Items]
Taxes paid	$ 0	$ 0
Interest paid, net of capitalized amounts	21	22
Dividends accrued for stock-based compensation awards		$ 1
Non-cash financing activities, excise tax to be paid	1
Carbon TerraVault JV
Supplemental Cash Flow Elements [Line Items]
Non-cash investing activities, capital call	$ 2

SUPPLEMENTAL ACCOUNT BALANCES

3 Months Ended

Mar. 31, 2023

SUPPLEMENTAL INFORMATION [Abstract]

SUPPLEMENTAL ACCOUNT BALANCES

Inventories — Materials and supplies, which primarily consist of well equipment and tubular goods used in our oil and natural gas operations, are valued at weighted-average cost and are reviewed periodically for obsolescence. Finished goods include produced oil and NGLs in storage, which are valued at the lower of cost or net realizable value. Inventories, by category, are as follows:



	March 31,		December 31,
	2023		2022
	(in millions)
Materials and supplies	$	61	$	56
Finished goods	3		4
Inventories	$	64	$	60

Other current assets, net — Other current assets, net includes the following:



	March 31,		December 31,
	2023		2022
	(in millions)
Net amounts due from joint interest partners(a)	$	39	$	39

Fair value of derivative contracts	40		39
Prepaid expenses	16		17
Greenhouse gas allowances	19		—
Natural gas margin deposits	16		16
Income tax receivable	—		10
Other	9		12
Other current assets, net	$	139	$	133

(a)Included in the March 31, 2023 and December 31, 2022 net amounts due from joint interest partners are allowances of $1 million.

Other noncurrent assets — Other noncurrent assets includes the following:



	March 31,		December 31,
	2023		2022
	(in millions)
Operating lease right-of-use assets	$	68	$	73
Deferred financing costs - Revolving Credit Facility	5		6
Emission reduction credits	11		11
Prepaid power plant maintenance	29		28
Fair value of derivative contracts	3		7
Deposits and other	17		15
Other noncurrent assets	$	133	$	140

Accrued liabilities — Accrued liabilities includes the following:


	March 31,		December 31,
	2023		2022
	(in millions)
Accrued employee-related costs	$	40	$	49
Accrued taxes other than on income	38		32
Asset retirement obligations	62		59
Accrued interest	9		19
Operating lease liability	14		18

Premiums due on derivative contracts	49		58
Liability for settlement payments on derivative contracts	23		33
Amounts due under production-sharing contracts	7		—
Income taxes payable	19		1

Other	37		29
Accrued liabilities	$	298	$	298

Other long-term liabilities — Other long-term liabilities includes the following:



	March 31,		December 31,
	2023		2022
	(in millions)
Compensation-related liabilities	$	38	$	36
Postretirement and pension benefit plans	31		33
Operating lease liability	50		52

Premiums due on derivative contracts	—		8
Contingent liability related to Carbon TerraVault JV put and call rights	49		48
Other	7		8
Other long-term liabilities	$	175	$	185

General and administrative expenses — The table below shows G&A expenses for our exploration and production business (in addition to unallocated corporate overhead and other) separately from our carbon management business. The amounts shown for our carbon management business are net of amounts reimbursable to us under the MSA with the Carbon TerraVault JV.


	Three months ended March 31,
	2023		2022
	(in millions)
Exploration and production, corporate and other	$	62	$	47
Carbon management business	3		1
Total general and administrative expenses	$	65	$	48

Other operating expenses, net — The table below shows other operating expenses, net for our exploration and production business (in addition to unallocated corporate overhead and other) separately from our carbon management business. Carbon management expenses includes lease cost for sequestration easements, advocacy, and other startup related costs.


	Three months ended March 31,
	2023		2022
	(in millions)
Exploration and production, corporate and other	$	9	$	14
Carbon management business	4		—
Total other operating expenses, net	$	13	$	14

LAWSUITS, CLAIMS, COMMITMENTS AND CONTINGENCIES	3 Months Ended
LAWSUITS, CLAIMS, COMMITMENTS AND CONTINGENCIES	Mar. 31, 2023
Commitments and Contingencies Disclosure [Abstract]
LAWSUITS, CLAIMS, COMMITMENTS AND CONTINGENCIES	LAWSUITS, CLAIMS, COMMITMENTS AND CONTINGENCIES We are involved, in the normal course of business, in lawsuits, environmental and other claims and other contingencies that seek, among other things, compensation for alleged personal injury, breach of contract, property damage or other losses, punitive damages, civil penalties, or injunctive or declaratory relief. We accrue reserves for currently outstanding lawsuits, claims and proceedings when it is probable that a liability has been incurred and the liability can be reasonably estimated. Reserve balances for these items at March 31, 2023 and December 31, 2022 were not material to our condensed consolidated balance sheets as of such dates. We also evaluate the amount of reasonably possible losses that we could incur as a result of these matters. We believe that reasonably possible losses that we could incur in excess of reserves cannot be accurately determined. In October 2020, Signal Hill Services, Inc. defaulted on its decommissioning obligations associated with two offshore platforms. The Bureau of Safety and Environmental Enforcement (BSEE) determined that former lessees, including our former parent, Occidental Petroleum Corporation (Oxy) with a 37.5% share, are responsible for accrued decommissioning obligations associated with these offshore platforms. Oxy sold its interest in the platforms approximately 30 years ago and it is our understanding that Oxy has not had any connection to the operations since that time and was challenging BSEE's order. Oxy notified us of the claim under the indemnification provisions of the Separation and Distribution Agreement between us and Oxy. In September 2021, we accepted the indemnification claim from Oxy and are challenging the order from BSEE.

SUPPLEMENTAL ACCOUNT BALANCES - Other Operating Expenses, Net (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Supplemental Information [Line Items]
Other operating expenses, net	$ 13	$ 14
Exploration and production, corporate and other
Supplemental Information [Line Items]
Other operating expenses, net	9	14
Carbon management business
Supplemental Information [Line Items]
Other operating expenses, net	$ 4	$ 0

BASIS OF PRESENTATION (Policies)	3 Months Ended
BASIS OF PRESENTATION (Policies)	Mar. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation	We are an independent energy and carbon management company committed to energy transition. We produce some of the lowest carbon intensity oil in the United States and are focused on maximizing the value of our land, minerals and technical resources for decarbonization efforts. We are in the early stages of developing several carbon capture and storage (CCS) projects in California and other emissions reducing projects. Our subsidiary Carbon TerraVault is expected to build, install, operate and maintain CO2 capture equipment, transportation assets and storage facilities in California. In August 2022, Carbon TerraVault entered into a joint venture with BGTF Sierra Aggregator LLC (Brookfield) to pursue certain of these opportunities (Carbon TerraVault JV). See Note 2 Investment in Unconsolidated Subsidiary and Related Party Transactions for more information on the Carbon TerraVault JV. Separately, we are evaluating the feasibility of a carbon capture system to be located at our Elk Hills power plant. Except when the context otherwise requires or where otherwise indicated, all references to ‘‘CRC,’’ the ‘‘Company,’’ ‘‘we,’’ ‘‘us’’ and ‘‘our’’ refer to California Resources Corporation and its subsidiaries. In the opinion of our management, the accompanying unaudited financial statements contain all adjustments necessary to fairly present our financial position, results of operations, comprehensive income, equity and cash flows for all periods presented. We have eliminated all significant intercompany transactions and accounts. We account for our share of oil and natural gas producing activities, in which we have a direct working interest, by reporting our proportionate share of assets, liabilities, revenues, costs and cash flows within the relevant lines on our condensed consolidated financial statements. In applying the equity method of accounting for variable interest entities that we do not control, the investment is initially recognized at cost and then adjusted for our proportionate share of income or loss, contributions and distributions. We have prepared this report in accordance with generally accepted accounting principles (GAAP) in the United States and the rules and regulations of the U.S. Securities and Exchange Commission applicable to interim financial information which permit the omission of certain disclosures to the extent they have not changed materially since the latest annual financial statements. We believe our disclosures are adequate to make the information presented not misleading. The preparation of financial statements in conformity with GAAP requires management to select appropriate accounting policies and make informed estimates and judgments regarding certain types of financial statement balances and disclosures. Actual results could differ. Management believes that these estimates and judgments provide a reasonable basis for the fair presentation of our condensed consolidated financial statements. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto in our Annual Report on Form 10-K for the year ended December 31, 2022 (2022 Annual Report). The carrying amounts of cash, cash equivalents and on-balance sheet financial instruments, other than debt, approximate fair value. Refer to Note 3 Debt for the fair value of our debt.

SUPPLEMENTAL ACCOUNT BALANCES (Tables)

3 Months Ended

Mar. 31, 2023

SUPPLEMENTAL INFORMATION [Abstract]

Schedule of Inventories

Inventories, by category, are as follows:



	March 31,		December 31,
	2023		2022
	(in millions)
Materials and supplies	$	61	$	56
Finished goods	3		4
Inventories	$	64	$	60

Schedule of Other Current Assets, Net

Other current assets, net includes the following:



	March 31,		December 31,
	2023		2022
	(in millions)
Net amounts due from joint interest partners(a)	$	39	$	39

Fair value of derivative contracts	40		39
Prepaid expenses	16		17
Greenhouse gas allowances	19		—
Natural gas margin deposits	16		16
Income tax receivable	—		10
Other	9		12
Other current assets, net	$	139	$	133

(a)Included in the March 31, 2023 and December 31, 2022 net amounts due from joint interest partners are allowances of $1 million.

Schedule of Other Noncurrent Assets

Other noncurrent assets includes the following:



	March 31,		December 31,
	2023		2022
	(in millions)
Operating lease right-of-use assets	$	68	$	73
Deferred financing costs - Revolving Credit Facility	5		6
Emission reduction credits	11		11
Prepaid power plant maintenance	29		28
Fair value of derivative contracts	3		7
Deposits and other	17		15
Other noncurrent assets	$	133	$	140

Schedule of Accrued Liabilities

Accrued liabilities includes the following:


	March 31,		December 31,
	2023		2022
	(in millions)
Accrued employee-related costs	$	40	$	49
Accrued taxes other than on income	38		32
Asset retirement obligations	62		59
Accrued interest	9		19
Operating lease liability	14		18

Premiums due on derivative contracts	49		58
Liability for settlement payments on derivative contracts	23		33
Amounts due under production-sharing contracts	7		—
Income taxes payable	19		1

Other	37		29
Accrued liabilities	$	298	$	298

Schedule of Other Long-term Liabilities

Other long-term liabilities includes the following:



	March 31,		December 31,
	2023		2022
	(in millions)
Compensation-related liabilities	$	38	$	36
Postretirement and pension benefit plans	31		33
Operating lease liability	50		52

Premiums due on derivative contracts	—		8
Contingent liability related to Carbon TerraVault JV put and call rights	49		48
Other	7		8
Other long-term liabilities	$	175	$	185

Schedule of General and Administrative Expenses

The table below shows G&A expenses for our exploration and production business (in addition to unallocated corporate overhead and other) separately from our carbon management business. The amounts shown for our carbon management business are net of amounts reimbursable to us under the MSA with the Carbon TerraVault JV.


	Three months ended March 31,
	2023		2022
	(in millions)
Exploration and production, corporate and other	$	62	$	47
Carbon management business	3		1
Total general and administrative expenses	$	65	$	48

Schedule of Other Expenses, Net

The table below shows other operating expenses, net for our exploration and production business (in addition to unallocated corporate overhead and other) separately from our carbon management business. Carbon management expenses includes lease cost for sequestration easements, advocacy, and other startup related costs.


	Three months ended March 31,
	2023		2022
	(in millions)
Exploration and production, corporate and other	$	9	$	14
Carbon management business	4		—
Total other operating expenses, net	$	13	$	14

INVESTMENT IN UNCONSOLIDATED SUBSIDIARY AND RELATED PARTY TRANSACTIONS - Equity Method Investment Unconsolidated Subsidiary, Income Statement (Details) - USD ($) $ in Millions	3 Months Ended		12 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022
Schedule of Equity Method Investments [Line Items]
Loss from investment in unconsolidated subsidiary	$ (2)	$ 0
Carbon TerraVault JV
Schedule of Equity Method Investments [Line Items]
Loss from investment in unconsolidated subsidiary	(2)	0	$ (1)
General and administrative expense	$ 1	$ 0

SUPPLEMENTAL ACCOUNT BALANCES - Inventories (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Inventory Disclosure [Abstract]
Materials and supplies	$ 61	$ 56
Finished goods	3	4
Inventories	$ 64	$ 60

DEBT - Fair Value (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Debt Disclosure [Abstract]
Fair value of debt	$ 607	$ 574

DERIVATIVES

3 Months Ended

Mar. 31, 2023

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVES

We maintain a commodity hedging program primarily focused on crude oil to help protect our cash flows, margins and capital program from the volatility of commodity prices. We did not have any derivative instruments designated as accounting hedges as of and for the three months ended March 31, 2023 and 2022. Unless otherwise indicated, we use the term "hedge" to describe derivative instruments that are designed to achieve our hedging requirements and program goals.

From time to time, we may enter into derivative contracts on natural gas to either protect our cash flows from commodity price movements or optimize margins for our marketing and trading activities.

Summary of open derivative contracts — We held the following Brent-based crude oil contracts as of March 31, 2023:


	Q2 2023		Q3 2023		Q4 2023		1H 2024		2H 2024
Sold Calls
Barrels per day	17,837		17,363		5,747		2,000		4,000
Weighted-average price per barrel	$	60.00	$	57.06	$	57.06	$	90.53	$	90.53

Swaps
Barrels per day	19,475		17,697		27,094		3,500		1,000
Weighted-average price per barrel	$	70.48	$	69.27	$	70.73	$	78.79	$	77.20

Net Purchased Puts(a)
Barrels per day	17,837		17,363		5,747		5,467		4,000
Weighted-average price per barrel	$	76.25	$	76.25	$	76.25	$	71.80	$	66.25

(a)Purchased puts and sold puts with the same strike price have been presented on a net basis.

The outcomes of the derivative positions are as follows:

•Sold calls – we make settlement payments for prices above the indicated weighted-average price per barrel.

•Swaps – we make settlement payments for prices above the indicated weighted-average price per barrel and receive settlement payments for prices below the indicated weighted-average price per barrel.

•Net purchased puts – we receive settlement payments for prices below the indicated weighted-average price per barrel.

We use combinations of these positions to increase the efficacy of our hedging program and, subject to certain conditions, meet the requirements of our Revolving Credit Facility. The majority of our derivative positions for the remainder of 2023 were entered into subsequent to our emergence from bankruptcy to comply with the hedging requirements of our Revolving Credit Facility that were applicable at the time.

Fair value of derivatives — The following tables present the fair values on a recurring basis (at gross and net) of our outstanding commodity derivatives as of March 31, 2023 and December 31, 2022:


March 31, 2023
Classification	Gross Amounts at Fair Value		Netting		Net Fair Value
Assets	(in millions)
Other current assets - Fair value of derivative contracts	$	48	$	(8)	$	40
Other noncurrent assets - Fair value of derivative contracts	10		(7)		3

Liabilities
Current - Fair value of derivative contracts(a)	(162)		8		(154)
Noncurrent - Fair value of derivative contracts	(7)		7		—
	$	(111)	$	—	$	(111)


December 31, 2022
Classification	Gross Amounts at Fair Value		Netting		Net Fair Value
Assets	(in millions)
Other current assets - Fair value of derivative contracts	$	51	$	(12)	$	39
Other noncurrent assets - Fair value of derivative contracts	7		—		7

Liabilities
Current - Fair value of derivative contracts(a)	(258)		12		(246)
Noncurrent - Fair value of derivative contracts	—		—		—
	$	(200)	$	—	$	(200)

Our derivative contracts are measured at fair value using industry-standard models with various inputs, including quoted forward prices, and are classified as Level 2 in the required fair value hierarchy for the periods presented. We recognized fair value changes on derivative instruments each reporting period in net gain (loss) from commodity derivatives on our condensed consolidated statements of operations for the three months ended March 31, 2023 and 2022. The changes in fair value result from the relationship between our existing positions, volatility, time to expiration, contract prices and the associated forward curves.

LAWSUITS, CLAIMS, COMMITMENTS AND CONTINGENCIES (Details)	1 Months Ended
	Oct. 31, 2020 platform
Commitments and Contingencies Disclosure [Abstract]
Number of offshore platforms with decommissioning obligations defaulted	2
Offshore platforms with decommissioning obligations defaulted percentage	37.50%
Offshore platforms with decommissioning obligations defaulted period since interest sold	30 years

INVESTMENT IN UNCONSOLIDATED SUBSIDIARY AND RELATED PARTY TRANSACTIONS

3 Months Ended

Mar. 31, 2023

Equity Method Investments and Joint Ventures [Abstract]

INVESTMENT IN UNCONSOLIDATED SUBSIDIARY AND RELATED PARTY TRANSACTIONS

In August 2022, our wholly-owned subsidiary Carbon TerraVault I, LLC entered into a joint venture with Brookfield for the further development of a carbon management business in California. We hold a 51% interest in the Carbon TerraVault JV and Brookfield holds a 49% interest. We determined that the Carbon TerraVault JV is a VIE; however, we share decision-making power with Brookfield on all matters that most significantly impact the economic performance of the joint venture. Therefore, we account for our investment in the Carbon TerraVault JV under the equity method of accounting. Transactions between us and the Carbon TerraVault JV are related party transactions.

Brookfield has committed an initial $500 million to invest in CCS projects that are jointly approved through the Carbon TerraVault JV. As part of the formation of the Carbon TerraVault JV, we contributed rights to inject CO2 into the 26R reservoir in our Elk Hills field for permanent CO2 storage (26R reservoir) and Brookfield committed to make an initial investment of $137 million, payable in three equal installments with the last two installments subject to the achievement of certain milestones. Brookfield contributed the first $46 million installment of their initial investment to the Carbon TerraVault JV in 2022. This amount may, at our sole discretion, be distributed to us or used to satisfy future capital contributions, among other items. During 2022, $12 million was distributed to us (and used to pay transaction costs related to the formation of the joint venture) and $2 million was used to satisfy a capital call. During 2023, $2 million was used to satisfy a capital call. The remaining amount of the initial contribution by Brookfield available to us was reported as a receivable from affiliate on our condensed consolidated balance sheet. Because the parties have certain put and call rights (repurchase features) with respect to the 26R reservoir if certain milestones are not met, the initial investment by Brookfield is reflected as a contingent liability in other long-term liabilities on our condensed consolidated balance.

We entered into a Management Services Agreement (MSA) with the Carbon TerraVault JV whereby we provide administrative, operational and commercial services under a cost-plus arrangement. Services may be supplemented by using third parties and payments to us under the MSA are limited to the amount in an approved budget. The MSA may be terminated by mutual agreement of the parties, among other events.

The tables below present the summarized financial information related to our equity method investment and related party transactions for the periods presented.



	March 31,		December 31,
	2023		2022
	(in millions)
Investment in unconsolidated subsidiary(a)	$	14	$	13
Receivable from affiliate(b)	$	30	$	33
Property, plant and equipment(c)	$	1	$	—
Contingent liability related to Carbon TerraVault JV put and call rights(d)	$	49	$	48

(a)Reflects our investment less losses allocated to us of $2 million and $1 million for the three months ended March 31, 2023 and the year ended December 31, 2022, respectively.

(c)This amount includes the reimbursement for plugging and abandonment activities at the 26R reservoir.


	Three months ended March 31,
	2023		2022
	(in millions)
Loss from investment in unconsolidated subsidiary	$	(2)	$	—
General and administrative expense(a)	$	1	$	—

(a)Includes amounts recognized by us under the MSA for administrative, operational and commercial services.

The Carbon TerraVault JV has an option to participate in certain projects that involve the capture, transportation and storage of CO2 in California. This option expires upon the earlier of (1) August 2027, (2) when a final investment decision has been approved by the Carbon TerraVault JV for storage projects representing in excess of 5 million metric tons per annum (MMTPA) in the aggregate, or (3) when Brookfield has made contributions to the joint venture in excess of $500 million (unless Brookfield elects to increase its commitment).

STOCKHOLDERS' EQUITY (Tables)

3 Months Ended

Mar. 31, 2023

Equity [Abstract]

Schedule Of Shares Repurchased

The following is a summary of our share repurchases, held as treasury stock for the periods presented:


	Total Number of Shares Purchased	Dollar Value of Shares Purchased		Average Price Paid per Share
	(number of shares)	(in millions)		($ per share)
Three months ended March 31, 2022	1,668,456	$	71	$	42.52
Three months ended March 31, 2023	1,423,764	$	59	$	41.25

Inception of Program (May 2021) through March 31, 2023	12,880,024	$	519	$	40.31

Note: The dollar value of shares purchased does not include commissions and excise taxes on share repurchases.

STOCKHOLDERS' EQUITY - Summary of Share Repurchases (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		23 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2023
Equity [Abstract]
Share repurchase (in shares)	1,423,764	1,668,456	12,880,024
Stock repurchase	$ 59	$ 71	$ 519
Average price (in dollar per share)	$ 41.25	$ 42.52	$ 40.31

SUPPLEMENTAL CASH FLOW INFORMATION	3 Months Ended
SUPPLEMENTAL CASH FLOW INFORMATION	Mar. 31, 2023
Supplemental Cash Flow Elements [Abstract]
SUPPLEMENTAL CASH FLOW INFORMATION	SUPPLEMENTAL CASH FLOW INFORMATION We did not make U.S. federal or state income tax payments during the three months ended March 31, 2023 or the three months ended March 31, 2022. Interest paid, net of capitalized amounts was $21 million and $22 million for the three months ended March 31, 2023 and 2022, respectively. Non-cash investing activities in the three months ended March 31, 2023 included $2 million related to a capital call for the Carbon TerraVault JV. Non-cash financing activities in the three months ended March 31, 2023 included an insignificant amount for dividends accrued for stock-based compensation awards. For the three months ended March 31, 2022 dividends accrued for stock-based compensation awards was $1 million. Non-cash financing activities in the three months ended March 31, 2023 also included $1 million related to an excise tax on share repurchases that we expect will be paid in 2024.

SUPPLEMENTAL ACCOUNT BALANCES - Other Noncurrent Assets (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
SUPPLEMENTAL INFORMATION [Abstract]
Operating lease right-of-use assets	$ 68	$ 73
Deferred financing costs - Revolving Credit Facility	5	6
Emission reduction credits	11	11
Prepaid power plant maintenance	29	28
Fair value of derivative contracts	3	7
Deposits and other	17	15
Other noncurrent assets	$ 133	$ 140