California Resources Corp. (NYSE: CRC), the state’s largest oil and natural gas producer, fell on its first official trading day since being spun off from Occidental Petroleum Corp. (NYSE: OXY), Bloomberg said Dec. 1.

The stock traded at $7.29 as of 9:52 a.m. in New York, giving it a market capitalization of $2.26 billion. Analysts estimated when the spinoff was announced in February that it could be worth as much as $19 billion. A decline in crude prices has lowered the value of the only publicly traded oil and gas producer purely focused on California.

California Resources seeks to squeeze more oil out of a state that most producers have shunned as they pursue more favorable geological and political conditions elsewhere. California’s Monterey Shale, previously thought to hold the largest source of recoverable oil reserves in the nation, was downgraded by the U.S. Energy Information Administration in May, which cut its estimates 96% because the reserves aren’t easily accessible using current technology.

The spinoff of Los Angeles-based California Resources, which last year produced the equivalent of about one of every five oil barrels for its former parent, is among the final steps in Occidental’s plan to boost its share price. The company drew investor criticism last year after announcing that CEO Stephen Chazen would depart. Instead, chairman Ray Irani was ousted after almost three decades at the company.

Chazen, who now plans to exit after the 2016 annual meeting, has sought buyers for assets in North America, the Middle East and North Africa as he seeks to focus on fewer areas of profitable growth.

Any effort to significantly boost production in California will require investments in technological breakthroughs at a time of falling oil prices and revenues. The company will also have to push for advances in drilling and production in a state with a strong environmental movement, residents skeptical of the oil industry and where regulations are likely to make operations difficult.

California Resources owns 2.3 million net acres of drilling rights in the state, an area larger than Delaware. It produced the equivalent of 160,000 barrels of oil and gas a day in the third quarter, up from 153,000 a year earlier. Quarterly profit fell because of rising costs and a drop in oil prices, which have declined more than 35% since June.

Occidental holders received 0.4 shares in the new company. Occidental has said it will retain ownership of 19.9% of the shares. The stock will be part of Standard & Poor’s Midcap 400 Index.