UPDATE 2-Occidental Q1 profit beats, weighs moves to boost stock
* First-quarter earnings/share ex items $1.69 vs est $1.54
* Cost cut program offsets lower natural gas prices
* Weighs buybacks, asset moves due to lower share price
* Stock rises 3.7 pct to 2-month high
By Braden Reddall and Siddharth Cavale
April 25 (Reuters) - Occidental Petroleum Corp posted a higher-than-expected profit as cost cuts blunted the impact of low natural gas prices, while the fourth-largest U.S. oil company weighs various efforts to boost its lagging stock price.
Shares of Occidental rose 3.7 percent to a two-month high on Thursday, but they are still down about 3 percent in the past year, compared with a 15 percent rise for California rival Chevron Corp.
Occidental Chief Executive Stephen Chazen, who would not comment on the timing of his departure while the board seeks the 66-year-old's eventual replacement, said the lower stock price meant there would "probably" be share buybacks in its future.
Chazen said a weaker stock value also meant he would have to take a harder look at possibly selling parts of the company or hiving assets off into tax-favorable master limited partnerships (MLP), though he wanted any such deals to move the needle.
"I do not want to go down the path of a sort of delicatessen approach to this where you slice a piece of baloney off and throw it to the wolves," he told analysts on a conference call.
Besides the United States, which accounts for nearly two-thirds of Occidental's production, the company has assets in Latin America and the Middle East.
Asked by one analyst about a potential move with its Middle East business as an example, Chazen talked hypothetically of splitting the entire thing as being easier than selling off one country at a time, which would require approvals. There was "no shortage of suggestions" for deals to make, he added.
"You start looking for things that move the needle a lot, rather than things to fine-tune," Chazen said, characterizing an MLP as fine-tuning.
Breakingviews story on potential Oxy moves
The company is fending off reports of a "fight at the top", which led its board to publish a statement this month denying any conflict and explaining that its search for a new CEO was part of a succession plan.
Occidental's first-quarter net profit fell to $1.36 billion, or $1.68 per share, from $1.56 billion, or $1.92 per share, a year earlier. Excluding items, it made $1.69 per share, topping the average analyst estimate of $1.54 per share, according to Thomson Reuters I/B/E/S.
Revenue fell 6 percent to $5.87 billion in the quarter.
Chazen said the company was ahead of schedule with its cost-cutting program unveiled last October and aimed at reducing U.S. drilling costs by 15 percent this year, a response to a tough 2012 in which costs escalated along with production increases.
U.S. operating costs fell to $14.06 per barrel in the first quarter from $16.44 per barrel a year earlier.
Most of the cost-cutting effort is focused on California, which accounts for about a third of its oil and gas output.
"The highlight was impressive progress on cost reduction initiatives," analysts at Simmons & Co wrote. "Total company production was slightly below our expectation."
Daily oil and gas production averaged 763,000 barrels of oil equivalent (boe) in the quarter, up from 755,000 boe a year ago.
Oxy said oil prices rose 2 percent from the fourth quarter, while natural gas prices fell 11 percent on the same basis.
Occidental's stock rose 3.7 percent to $87.49 in afternoon trading on the New York Stock Exchange on Thursday.
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