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Though the Eden Bowl was a lovely, healthy option, we also grabbed some cider donuts for the road. I can fully vouch for them as well. Even with the coffee, OJ, veggie bowl, donuts and tip, the bill rang in under the $52 breakfast credit.

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Rob will cover our financial results, as well as our updated guidance, which includes an increase in our full year guidance for OxyChem. Starting with our shareholder return framework. Our ability to consistently deliver outstanding operational results, combined with our focus to improve our balance sheet, have positioned us to increase the amount of capital returned to shareholders. Considering current commodity prices expectations, we expect to repurchase a total of $3 billion of shares and reduce gross debt to the high teens by the end of this year.

It's achievements like this that make me so proud to announce the modernization and expansion of one of OxyChem's key plants, which we'll detail in just a minute. Turning to oil and gas. I'd like to congratulate the Gulf of Mexico team in celebrating first oil from the new discovery field, Horn Mountain West. The new field was successfully tied back to the Horn Mountain spar using a three and a half-mile dual flow line.

The project came in on budget and more than three months ahead of schedule. The Horn Mountain West tieback is expected to eventually add approximately 30,000 barrels of oil production per day and is an excellent example of our ability to leverage our assets and technical expertise to bring new production online in a capital-efficient manner. I'd also like to congratulate our Al Hosn and Oman teams. Al Hosn achieved a recent production record following the first full plant shutdown as a part of a planned turnaround in the first quarter.

The Battleground project represents the first sizable investment we've made in OxyChem since the construction and completion of the 4CPe plant, an ethylene cracker that were completed in 2017. This high-return project is just one of several opportunities we have to grow OxyChem's cash flow over the next few years. We are conducting similar FEED studies for additional chlor-alkali assets and plan to communicate the results when complete. I'll now turn the call over to Rob, who will walk you through our second quarter results and guidance.

We expect the Delaware JV and the enhanced Midland JV and to allow us to maintain or even lower industry-leading capital intensity in the Permian in 2023 onwards. We will provide further details when we provide 2023 production guidance. Given that January 1, '22 effective date and related working interest transferred to our JV partner in the Midland Basin, we have adjusted our full year Permian production guidance down slightly. Separately, we are reallocating a portion of the capital we earmarked for the OBO spending this year to our operated Permian assets.

Reallocating capital operating activity will provide more certainty in our West delivery for the second half of 2022 and the start of 2023, while also delivering superior returns given our inventory quality and cost control. While the timing of this change has a slight impact on our 2022 production due to activity relocation in the second half of the year, the benefit of developing resources that we operate is expected to result in even stronger financial performance going forward. The updated activity slide in the earnings presentation appendix reflects this change. The shift in OBO capital, combined with the JV working interest transfer, as well as various short-term operability matters all contributed to a slightly lowering our full year Permian production guidance.

The operability impacts are primarily related to third-party issues, such as downstream gas processing interruptions on our EOR assets and other unplanned disruptions at third parties. For 2022, companywide full year production guidance remains unchanged, as the Permian adjustment is fully offset by high production in the Rockies and the Gulf of Mexico. Finally, we note that our Permian production delivery remains very strong, with a growth of approximately 100,000 BOE per day when comparing the fourth quarter of 2021 through our implied production guidance for the fourth quarter of 2022. We expect production in the second half of 2022 to average approximately 1.2 million BOE per day, which is notably higher than the first half of the year.

Higher production in the second half of the year has always been an expected outcome of our 2022 plan, in part due to ramp-up activities and scheduled turnarounds in the first quarter. Companywide third quarter production guidance includes continued growth in the Permian, but considers the potential for tropical weather impacts in the Gulf of Mexico, combined with third-party downtime and production decline in Rockies given our lower activity set as a result of relocating a rig to the Permian. Our full year capital budget remains unchanged. But as I mentioned in our previous call, we expect capital spending to come in near the high end of our range of $3.9 billion to $4.3 billion.

Certain areas that we operate in, especially the Permian, continue to experience higher inflationary pressures than others. To support activity into 2023 and address the regional impact of inflation, we are reallocating $200 million of capital to the Permian. We believe our companywide capital budget is sized appropriately to execute our 2022 plan, as the additional capital for the Permian will be reallocated from other assets that have been able to generate higher-than-expected capital savings. We are raising our full year domestic operating expense guidance to $8.50 per BOE, which accounts for higher-than-expected labor and energy costs, primarily in the Permian, as well as continued upward pricing pressure on our WTI index CO2 purchase contracts in the EOR business.

OxyChem continues to perform well, and we have raised our full year guidance to reflect the exceptional second quarter performance, as well as a slightly better than previously expected second half of the year. We still see the potential for market conditions to dampen from where we are today due to inflationary pressures, though the long-term fundamentals continue to remain supportive, and we expect third and fourth quarters to be strong by historical standards. Turning back to financial items. In September, we intend to settle $275 million of notional interest rate swaps. 350c69d7ab


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