Occidental Petroleum Corp. redeemed $647 million, or about 6.5%, of Berkshire Hathaway Inc.’s preferred stock as the oil company begins paying back Warren Buffett four years after he helped finance its acquisition of Anadarko Petroleum Corp.

The total cost of Occidental’s redemption was $712 million as it includes a 10% premium to Buffett and matches distributions to common stock holders, the Houston-based company said in a presentation Tuesday. Buffett’s preferred stock carries an 8% annual dividend, making it an expensive part of Occidental’s capital structure.

Separately, Berkshire owns a 24% stake in Occidental common stock and is the company’s largest shareholder, according to data compiled by Bloomberg. Berkshire is willing to buy more Occidental common stock, Buffett said at its shareholder meeting in Omaha this month. However, he ruled out buying the oil producer outright.

Occidental’s adjusted earnings were $1.09 a share in the first quarter, missing the Bloomberg Consenus of $1.23 a share. It raised its full-year production guidance 1.3% to almost 1.2 million barrels of oil equivalent a day while keeping capital expenditure unchanged. The stock dropped 1.6% in after-market trading.