UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) February 3, 2009
OCCIDENTAL PETROLEUM CORPORATION
(Exact name of registrant as specified in its charter)
|
Delaware |
1-9210 |
95-4035997 |
|
(State or other jurisdiction of incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
|
10889 Wilshire Boulevard Los Angeles, California |
90024 |
|
(Address of principal executive offices) |
(ZIP code) |
Registrant’s telephone number, including area code:
(310) 208-8800
Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Section 7 – Regulation FD
Item 7.01. Regulation FD Disclosure
Attached as Exhibit 99.1 is a presentation made by Stephen I. Chazen, Occidental’s President and Chief Financial Officer, on February 3, 2009, in connection with the Credit Suisse 2009 Energy Summit.
Section 9 – Financial Statements and Exhibits
Item 9.01. Financial Statements and Exhibits
(d) Exhibits
|
99.1 |
Presentation dated February 3, 2009. |
1
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
|
|
|
OCCIDENTAL PETROLEUM CORPORATION |
|
|
|
(Registrant) |
|
DATE: February 3, 2009 |
|
/s/ ROY PINECI |
|
|
|
Roy Pineci, Vice President, Controller and Principal Accounting Officer |
EXHIBIT INDEX
|
99.1 |
Presentation dated February 3, 2009. |
EXHIBIT 99.1
February 3, 2009
Stephen I. Chazen
President and
Chief Financial Officer
Credit Suisse
2009 Energy Summit
1
2
Full Year 2008 Results – Summary
($ in millions, except EPS data)
2008
2007
Core Results 1
$7,348
$4,405
Core EPS (diluted)
$8.95
$5.25
+70% year-over-year
Net Income
$6,857
$5,400
Reported EPS (diluted)
$8.35
$6.44
Oil and Gas sales volumes (mboe/day)
601
570
+5.4% year-over-year
Capital Spending
$4,664
$3,360
Cash Flow from Operations
$10,700
$6,800
ROE
27%
26%
ROCE 1
25%
24%
1See attached for GAAP reconciliation.
2
3
Corporate Strategy/Philosophy
Focus on core areas – long-term production growth
of 5 - 8% CAGR
US - Permian Basin, California, and Mid-continent/Rockies
Middle East/North Africa
Latin America
Maintain strong balance sheet
Maintain “A” credit rating
Maintain investment discipline
Create value
Capture EOR projects with large volumes of oil in place
Acquire assets with upside potential
Maintain top quartile financial returns
Maximize free cash flow from chemicals
Continue to increase the dividend regularly
3
4
Worldwide Oil & Gas Operations
Joslyn
Piceance
Hugoton
California
Permian Basin
Colombia
Bolivia
Argentina
Libya
Qatar
UAE
Oman
Yemen
4
5
Worldwide Production Outlook
Thousand BOE/Day
466
2005
545
2006
570
2007
601
2008
660
620
2009E
CAGR
= 8.3%
Note: Importantly this forecast is based only on existing projects and does not contemplate any new projects or future acquisitions.
5
6
2008 Reserve Replacement
We estimate that we replaced approximately 200% of our oil
and gas production in 2008.
This excludes the effect of price changes from 2007 to 2008.
Including the effect of price changes, we estimate that we
replaced around 150% of our 2008 production.
Slightly over half of the 2008 reserve additions, excluding
effect of price changes, came from internal sources resulting
in over 100% reserve replacement.
Major reserve increases were in:
the California properties;
the Permian and the Rockies, and;
Oman.
In aggregate, these areas constituted more than half of such reserve
adds.
6
7
Business Risk Factors
Level of Risk Acceptable to Occidental
Risk Factor
Low
Middle
High
Exploratory
ü
Commodity
ü
Political
ü
Engineering
ü
Reinvestment
ü
Financial
ü
7
8
Capital Allocation Philosophy
New projects must meet expectations for good returns
Return Targets*
Domestic – 15+%
International – 20+%
Compare new projects and asset acquisitions with share
repurchases
Pursue only those opportunities which meet our standards
for ROCE and complement our existing assets
Make decisions based on creating long-term value for
shareholders
*Assumes Moderate Product Prices
8
9
Capital Spending Program
2008 capital program was about $4.7 billion, and we spent
another $4.7 billion for acquisitions.
As a result, we have accumulated a sizeable inventory of projects which can
be delayed until the industry cost structure is in line with product prices.
2009 capital program of $3.5 billion will focus on ensuring
that our returns remain well above our cost of capital given
current oil and gas prices and contractor costs.
Service company cost structure is more reflective of an $80 oil environment
rather than a $40 one.
About 80% of the capital will be in Oil and Gas and the remainder in
Midstream and Chemical.
An illustration of our ability to defer drilling is that we have 5
mm net acres in the US;
70% of this acreage is held by production;
about 10% consists of long-term leases, with many years on average to run,
and;
the remainder is in mineral acres held in perpetuity.
9
10
Capital Spending Program
Gas drilling with less than $5 per mcf gas is unattractive.
We will continue to fully fund much of our Middle East
operations, successful exploration programs in California,
Utah, and exploration in Argentina.
Formerly "quick payout" wells in the Permian and California
will be deferred until they become "quick payout" again.
We will continue to fund our Midstream and CO2 programs.
Expect our capital run rate in 1Q09 to be greater than the $3.5
billion level and will decline all year unless economic
conditions improve.
The effect of this program on our production should be modest in 2009, around
10 mboe/d, with a probable production range of 620 to 660 mboe/d and, with
about 630 to 650 mboe/d in 1Q09.
Year-over-year, Argentina and Oman will show the most growth.
10
11
Capital Spending Program
We are renegotiating our supplier contracts to further reduce
costs and are laying down rigs, including paying cancellation
costs when that makes sense.
We expect these efforts to result in a reduction in the cost of executing our
capital programs, as well as, a reduction of our operating expenses.
When costs and prices are inline, our capital program will be
boosted and the project inventory worked down faster.
We are also focusing on internal costs.
Some reductions in overhead will be made this year which should improve our
overhead levels by at least $1/boe.
Oxy’s focus has been and will continue to be delivering
returns well in excess of our cost of capital.
11
12
Oil & Gas, and Midstream Capital Spending
($ in millions)
2008
2009E
Growth Capital
2,065
1,005
Base Capital
2,275
2,120
Total Oil & Gas, and Midstream Capital
4,340
3,125
12
13
US Oil & Gas Operations
Elk Hills
&
California
Properties
Bakersfield
Los Angeles
Long Beach
Piceance Basin
Sheep Mountain
Hugoton
Bravo Dome
Oxy Permian
Houston
2008 net production*
361 mboe/day
60% of worldwide total
2007 reserves*
2.15 billion boe
75% of worldwide total
* See attached for GAAP reconciliation.
13
14
US Oil & Gas Operations
Thousand BOE/Day
US Oil and Gas Production
331
2005
354
2006
359
2007
361
2008
383
357
2009E
Key Operations/Assets:
Permian Basin
California/Elk Hills Field
Mid-Continent/Rockies
2008 Financial Data1
Pre-tax Income
$5.8 Billion
After-tax Cash
$3.3 Billion
Capital
$1.8 Billion
ROANCC**
25%
**ROANCC = Return On Average Net Capitalized Costs.
A-T Cash = Income from continuing operations after US income
taxes, plus DD&A, and minus exploration and development costs
incurred.
1See attached for GAAP reconciliation.
14
15
Permian Basin Operations
Colorado
Sheep Mountain
Kansas
Hugoton
Bravo Dome
To Cushing, OK
New Mexico
Denver City Unit
Lubbock
Salt Creek
Indian Basin
Area
Cogdell
Hobbs
Midland
Sharon Ridge
Seminole
Texas
Oxy Acreage
CO2 Pipelines
New Centurion Pipelines
Old Centurion Pipelines
Large resource inventory — Oxy
owns 1.7 mm acres
2008 production of 198 mboe/day
Low decline rate & long-lived
properties
Significant cash generation
Significant investment in long-lead
CO2 projects (SandRidge)
Integrated assets acquired from PXP
Response to lower oil & gas prices
Reduced drilling rig count to 8 active
rigs, down from 15
Reduced workover rig count to 80
from a peak of 185
Natural area for consolidation
15
16
Permian – Century CO2 Plant Project
McCamey
Hub
NGL
Pipelines
Oil
Pipelines
CO2
Pipelines
County
Mitchell
Pikes
Peak
Gray Ranch
Oxy
Pinon Field
Pakenham
New Plant
“Century”
Oxy
JM – Brown Bassett
SandRidge
Acreage
Terrell
(Oxy)
1,300 mi2 3D
5 phases
County
TX
Gas Plants
SD Plant
CO2 Pipelines
Oxy to invest $1.1 B in
CO2 plant and pipeline
facilities.
CO2 to be used in Oxy’s
Permian EOR projects.
New CO2 resources
expected to expand
Oxy’s Permian
production by at least 50
mb/day within 5 years.
Allows Oxy to exploit at
least 3.5 tcf of CO2 for
EOR use.
Enables Oxy to accelerate
and enhance development
of existing assets.
16
17
California Operations
2008 production of 128 mboe/day
Oxy is the largest acreage holder in
the state
Continue to build inventory of drilling
opportunities
Planning various EOR and
waterflood expansion projects.
Expect to increase production by
expanding our drilling program in
the various shale plays and deeper
pay zones where we have had
recent exploration successes.
Continue to fund development and
exploration even in the current
product price environment
17
18
Middle East/North Africa Oil & Gas
2008 net production*
164 mboe/day
27% of worldwide total
Libya
Qatar
UAE
Oman
Yemen
2007 reserves*
468 million boe
16% of worldwide total
* See attached for GAAP reconciliation.
18
19
Middle East/North Africa Oil & Gas
Thousand BOE/Day
Middle East/North Africa
Oil and Gas Production
103
2005
119
2006
135
2007
164
2008
194
185
2009E
Key Operations/Assets:
Dolphin Project
Qatar ISND
Oman/Mukhaizna
Libya
2008 Financial Data1
Pre-tax Income
$4.5 Billion
After-tax Cash
$1.3 Billion
Capital
$1.1 Billion
ROANCC**
41%
**ROANCC = Return On Average Net Capitalized Costs.
A-T Cash = Income from continuing operations minus income tax
owed by Oxy and paid by governmental entities on its behalf plus
DD&A minus exploration and development costs incurred.
1See attached for GAAP reconciliation.
19
20
Oman – Mukhaizna Project
Continuing large scale steam flood
EOR project – drilled 370+ wells
thru 2008
Gross production at year-end 2008
was 6x higher vs. Sept. 2005
Expect to drill approximately 215
new wells in 2009
Met targeted 2008 production exit
rate of 50 mb/d (gross)
Completing all multiple water
treatment facilities to supply the
steam generators in order to:
increase gross production to year-
end 2009 exit rate of 80 mb/d;
Expect to increase gross
production to 150 mb/d by 2012
Arabian Gulf
Fujairah
Gulf of Oman
Sohar
Al Ain
UAE
Blocks 9 & 27
9
27
PDO Block 6
Saudi Arabia
54
53
Oman
Mukhaizna
Arabian Sea
Salalah
Oxy Blocks
20
21
Oman – Gas Project
PSA signed on November 24th
Newly formed contract area –
“Habiba” - Block 62
20-year agreement covers 2,269
km2
Development of four gas fields
Exploration potential
Partners
Oxy (operator) 48%, Mubadala
32%, Oman 20%
Development Plan
First production by 2010
Gross production approximately
27 to 28 mboe/d by year-end 2011
Arabian Gulf
Arabian Sea
Gulf of Oman
UAE
Saudi Arabia
Oman
Fujairah
Sohar
Al Ain
Salalah
PDO Block 6
54
Habiba
Muscat
9
27
Oxy Blocks
21
22
Abu Dhabi – New Concessions
Agreement signed with
ADNOC to appraise and
develop of Jarn Yaphour and
Ramhan fields
Oxy will operate and hold a
100% interest in both fields
First production at Jarn
Yaphour expected in 2010
First production at Ramhan
anticipated in 2011
When fully operational, we
expect these two projects to
produce approximately 20
mboe/d (gross)
Qatar
Saudi Arabia
UAE
Oman
Maqta
Abu Dhabi
Taweelah
Dubai
Al
Ain
0
100
200 Km
Jarn
Yaphour
Field
Ramhan
Field
22
23
Oxy selected by Bahrain National
Oil and Gas Authority to develop oil
and gas assets in the Kingdom
Field discovered in 1932
12 billion BOE originally in place
We are now finalizing the relevant
technical and financial agreements
We hope to have the completed
agreement approved by the Bahrain
Parliament before year-end
State
of
Qatar
Arabian
Gulf
Kingdom
of
Saudi
Arabia
Kingdom
of
Bahrain
Bahrain
Field
Bahrain Field Development Project
23
24
Latin America Oil & Gas Operations
Colombia
Bolivia
Argentina
2008 net production*
76 mboe/day
13% of worldwide total
2007 reserves*
244 million boe
9% of worldwide total
* See attached for GAAP reconciliation.
24
25
Latin America Oil & Gas Operations
Key Operations/Assets:
Colombia
Argentina
2008 Financial Data1
Pre-tax Income
$0.5 Billion
After-tax Cash
$0.5 Billion
Capital
$1.0 Billion
ROANCC**
14%
32
72
76
2005
2006
2007
Thousand BOE/Day
Latin America
Oil and Gas Production
**ROANCC = Return On Average Net Capitalized Costs.
76
78
83
2008
2009E
A-T Cash = Income from continuing operations minus income tax
owed by Oxy and paid by governmental entities on its behalf plus
DD&A minus exploration and development costs incurred.
1See attached for GAAP reconciliation.
25
26
Argentina Operations
2008 production – 36 mboe/day
Drilled 162 new wells in 2008 and
performed a number of recompletions
Inventory of more than 700 drilling
locations
Near field exploration program
continues to be successful and has
identified new drilling opportunities
Expect to increase production
significantly over the next four years
through drilling, waterflooding and
EOR projects
Oxy Blocks
San Jorge Basin
Cuyo Basin
Neuquen Basin
Argentina
Uruguay
Brazil
26
27
Other Value Enhancing Initiatives
Chemicals Operations
Midstream Assets – Pipelines
Dividend Growth
27
28
Chemicals Operations
($ Millions)
Period ending 12/31/08*
3-Year*
5-Year*
Average
Average
2007
2008
Pre-tax Earnings
$755
$693
$601
$759
Free Cash Flow1
$808
$767
$660
$830
Capital Spending
$244
$210
$245
$240
1See attached for GAAP reconciliation.
28
29
Midstream, Marketing and Other
Midstream assets reclassified out of the Oil and Gas segment
The assets are comprised of the following businesses: Marketing, Gas processing
plants, Pipelines, Power generation, CO2 source fields and facilities
($ in millions)
Midstream Data
2008
2007
Core Results
$520
$367
Net Book Value
$2,930
$1,935
Capex & Acquisition costs
$880
$430
Funds will be spent enhancing our CO2 production,
investing in construction of
the W. Texas gas processing plant, and expanding our pipeline capacity.
29
$12,700
$4,700
$1,500
$950
$940
$1,800
Available
Cash
Capex
Acquisitions
Share
Repurchase
Dividends
Other
Ending Cash
Balance
12/31/08
Cash
Flow From
Operations
$10,700
($ in millions)
Debt
Beginning
Cash
$2,000
$4,700
$10
Full Year 2008 Cash Flow
30
31
Creating Shareholder Value – Dividends
$0.52
$0.55
$0.645
$0.80
Annual Dividend Payout per share
$0.50
$0.94
Establishing a track record of consistent dividend increases
$1.21
31
32
Occidental Petroleum Corporation
Statements in this presentation that contain words such as "will," "expect" or "estimate,"
or otherwise relate to the future, are forward-looking and involve risks and uncertainties
that could significantly affect expected results. Factors that could cause results to differ
materially include, but are not limited to: global commodity pricing fluctuations and
supply/demand considerations for oil, gas and chemicals; exploration risks such as
drilling of unsuccessful wells, higher than expected costs; operational interruptions;
political risks; changes in tax rates; unrealized acquisition benefits or higher than
expected integration costs; and not successfully completing (or any material delay in) any
expansion, capital expenditure, acquisition or disposition. You should not place undue
reliance on these forward-looking statements which speak only as of the date of this
presentation. Unless legally required, Occidental does not undertake any obligation to
update any forward-looking statements as a result of new information, future events or
otherwise. Additionally, the SEC requires oil and natural gas companies, in their filings,
to disclose non-financial statistical information about their consolidated entities separately
from such information about their equity holdings and not to show combined totals. The
United States Securities and Exchange Commission (SEC) permits oil and natural gas
companies, in their filings with the SEC, to disclose only proved reserves demonstrated
by actual production or conclusive formation tests to be economically producible under
existing economic and operating conditions. We use certain terms in this presentation,
such as price unadjusted reserves, that the SEC's guidelines strictly prohibit us from
using in filings with the SEC. Certain information in this presentation is shown on a
combined basis; however, the information is disclosed separately on our web site at
www.oxy.com
.. U.S.
investors are urged to consider carefully the disclosure in our Form
10-K, available through
1-888-699-7383 or at www.oxy.com. You
also can obtain a copy
from the SEC by calling 1-800-SEC-0330.
32
33
33
Occidental Petroleum Corporation
Reconciliation to Generally Accepted Accounting Principles (GAAP)
For the Twelve Months Ended December 31,
($ Millions)
|
|
|
2008 |
|
2007 | ||||||||||||
|
|
|
|
|
|
|
Diluted |
|
|
|
|
|
Diluted | ||||
|
|
|
|
|
|
|
EPS |
|
|
|
|
|
EPS | ||||
|
Reported Income |
|
$ |
6,857 |
|
|
$ |
8.35 |
|
|
$ |
5,400 |
|
|
$ |
6.44 |
|
|
Add: significant items affecting earnings |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on sale of Russia joint venture * |
|
|
– |
|
|
|
|
|
|
|
(412 |
) |
|
|
|
|
|
Legal settlements * |
|
|
– |
|
|
|
|
|
|
|
(112 |
) |
|
|
|
|
|
Gain on sale of oil and gas interests |
|
|
– |
|
|
|
|
|
|
|
(35 |
) |
|
|
|
|
|
Asset impairments |
|
|
599 |
|
|
|
|
|
|
|
74 |
|
|
|
|
|
|
Sale of exploration properties |
|
|
– |
|
|
|
|
|
|
|
(103 |
) |
|
|
|
|
|
Rig contract terminations |
|
|
58 |
|
|
|
|
|
|
|
– |
|
|
|
|
|
|
Plant closure and impairment |
|
|
90 |
|
|
|
|
|
|
|
– |
|
|
|
|
|
|
Debt purchase expense |
|
|
– |
|
|
|
|
|
|
|
167 |
|
|
|
|
|
|
Facility closure |
|
|
– |
|
|
|
|
|
|
|
47 |
|
|
|
|
|
|
Gain on sale of Lyondell shares |
|
|
– |
|
|
|
|
|
|
|
(326 |
) |
|
|
|
|
|
Severance accrual |
|
|
– |
|
|
|
|
|
|
|
25 |
|
|
|
|
|
|
Tax effect of pre-tax adjustments |
|
|
(238 |
) |
|
|
|
|
|
|
2 |
|
|
|
|
|
|
Discontinued operations, net * |
|
|
(18 |
) |
|
|
|
|
|
|
(322 |
) |
|
|
|
|
|
Core Results |
|
$ |
7,348 |
|
|
$ |
8.95 |
|
|
$ |
4,405 |
|
|
$ |
5.25 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Amount shown after-tax |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Diluted Common Shares Outstanding |
|
|
|
|
|
|
820.8 |
|
|
|
|
|
|
|
839.1 |
|
Occidental Petroleum Corporation
Return on Capital Employed (% )
($ Millions)
|
Reconciliation to Generally Accepted Accounting Principles (GAAP) |
|
2007 |
|
2008 | ||
|
GAAP measure – earnings applicable to common shareholders |
|
5,400 |
|
|
6,857 |
|
|
Interest expense |
|
199 |
|
|
26 |
|
|
Tax effect of interest expense |
|
(70 |
) |
|
(9 |
) |
|
Earnings before tax-effected interest expense |
|
5,529 |
|
|
6,874 |
|
|
|
|
|
|
|
|
|
|
GAAP stockholders' equity |
|
22,823 |
|
|
27,300 |
|
|
|
|
|
|
|
|
|
|
DEBT |
|
|
|
|
|
|
|
GAAP debt |
|
|
|
|
|
|
|
Debt, including current maturities |
|
1,788 |
|
|
2,747 |
|
|
Non-GAAP debt |
|
|
|
|
|
|
|
Capital lease obligation |
|
25 |
|
|
25 |
|
|
Total debt |
|
1,813 |
|
|
2,772 |
|
|
|
|
|
|
|
|
|
|
Total capital employed |
|
24,636 |
|
|
30,072 |
|
|
|
|
|
|
|
|
|
|
Return on Capital Employed (%) |
|
24 |
|
|
25 |
|
Worldwide Sales Volumes
Thousand Barrels of Oil Equilavent per Day
Reconciliation to Generally Accepted Accounting Principles (GAAP)
|
|
|
Consolidated Subsidiaries |
|
Other Interests |
|
Worldwide |
|
| |||||||||||||||
|
2008 |
|
OIL |
GAS |
BOE |
|
OIL |
GAS |
BOE |
|
OIL |
GAS |
BOE |
|
% of Total | |||||||||
|
SALES VOLUMES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US |
|
263 |
|
587 |
|
361 |
|
|
– |
|
– |
|
– |
|
|
263 |
|
587 |
|
361 |
|
|
60% |
|
Latin America |
|
75 |
|
42 |
|
82 |
|
|
(6 |
) |
– |
|
(6 |
) |
|
69 |
|
42 |
|
76 |
|
|
13% |
|
Middle East / North Africa |
|
127 |
|
208 |
|
162 |
|
|
2 |
|
– |
|
2 |
|
|
129 |
|
208 |
|
164 |
|
|
27% |
|
Total |
|
465 |
|
837 |
|
605 |
|
|
(4 |
) |
– |
|
(4 |
) |
|
461 |
|
837 |
|
601 |
|
|
100% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Natural gas volumes have been converted to equivalent BOE based on energy content of 6,000 cubic feet of gas to one barrel of oil
Worldwide Reserves
Reconciliation to Generally Accepted Accounting Principles (GAAP)
|
|
|
Consolidated Subsidiaries |
|
Other Interests |
|
Worldwide |
|
| |||||||||||||||
|
2007 |
|
OIL |
GAS |
BOE |
|
OIL |
GAS |
BOE |
|
OIL |
GAS |
BOE |
|
% of Total | |||||||||
|
RESERVES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US |
|
1,707 |
|
2,672 |
|
2,152 |
|
|
– |
|
– |
|
– |
|
|
1,707 |
|
2,672 |
|
2,152 |
|
|
75% |
|
Latin America |
|
214 |
|
208 |
|
249 |
|
|
(5 |
) |
– |
|
(5 |
) |
|
209 |
|
208 |
|
244 |
|
|
9% |
|
Middle East / North Africa |
|
305 |
|
963 |
|
465 |
|
|
3 |
|
– |
|
3 |
|
|
308 |
|
963 |
|
468 |
|
|
16% |
|
Total |
|
2,226 |
|
3,843 |
|
2,866 |
|
|
(2 |
) |
– |
|
(2 |
) |
|
2,224 |
|
3,843 |
|
2,864 |
|
|
100% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Occidental Petroleum Corporation
Reconciliation to Generally Accepted Accounting Principles (GAAP)
For the Year Ended December 31, 2008
|
|
|
Consolidated Subsidiaries | |||||||||||||
|
|
|
United |
|
Latin |
|
Middle East |
|
Other |
|
| |||||
|
|
|
States |
|
America |
|
North Africa |
|
Eastern |
|
TOTAL | |||||
|
Capitalized Costs |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proved properties |
|
22,543 |
|
|
5,177 |
|
|
9,829 |
|
|
– |
|
|
37,549 |
|
|
Unproved properties |
|
1,855 |
|
|
– |
|
|
74 |
|
|
4 |
|
|
1,933 |
|
|
|
|
24,398 |
|
|
5,177 |
|
|
9,903 |
|
|
4 |
|
|
39,482 |
|
|
Accumulated DD&A |
|
(6,669 |
) |
|
(1,693 |
) |
|
(4,021 |
) |
|
– |
|
|
(12,383 |
) |
|
Capitalized cost |
|
17,729 |
|
|
3,484 |
|
|
5,882 |
|
|
4 |
|
|
27,099 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs Incurred |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property Acquisition Costs |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proved Properties |
|
1,819 |
|
|
8 |
|
|
4 |
|
|
– |
|
|
1,831 |
|
|
Unproved Properties |
|
1,362 |
|
|
– |
|
|
9 |
|
|
– |
|
|
1,371 |
|
|
Exploration Costs |
|
130 |
|
|
96 |
|
|
115 |
|
|
– |
|
|
341 |
|
|
Development Costs |
|
1,740 |
|
|
864 |
|
|
1,835 |
|
|
– |
|
|
4,439 |
|
|
Cost Incurred |
|
5,051 |
|
|
968 |
|
|
1,963 |
|
|
– |
|
|
7,982 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Results of Operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues |
|
9,581 |
|
|
2,009 |
|
|
6,253 |
|
|
– |
|
|
17,843 |
|
|
Production costs |
|
1,666 |
|
|
429 |
|
|
590 |
|
|
– |
|
|
2,685 |
|
|
Taxes other than on income |
|
544 |
|
|
36 |
|
|
– |
|
|
– |
|
|
580 |
|
|
Exploration expenses |
|
93 |
|
|
54 |
|
|
265 |
|
|
(3 |
) |
|
409 |
|
|
Other operating expenses |
|
350 |
|
|
44 |
|
|
158 |
|
|
1 |
|
|
553 |
|
|
Impairment of suspended costs |
|
– |
|
|
476 |
|
|
– |
|
|
– |
|
|
476 |
|
|
DD&A |
|
1,094 |
|
|
453 |
|
|
760 |
|
|
– |
|
|
2,307 |
|
|
Pretax income |
|
5,834 |
|
|
517 |
|
|
4,480 |
|
|
2 |
|
|
10,833 |
|
|
Income taxes |
|
1,857 |
|
|
37 |
|
|
2,284 |
|
|
– |
|
|
4,178 |
|
|
Results of operations |
|
3,977 |
|
|
480 |
|
|
2,196 |
|
|
2 |
|
|
6,655 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
After-tax Cash |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
After-tax income |
|
3,977 |
|
|
480 |
|
|
2,196 |
|
|
2 |
|
|
6,655 |
|
|
+ DD&A |
|
1,094 |
|
|
453 |
|
|
760 |
|
|
– |
|
|
2,307 |
|
|
+ Impairment of suspended costs |
|
– |
|
|
476 |
|
|
– |
|
|
– |
|
|
476 |
|
|
+ Exploration expense |
|
93 |
|
|
54 |
|
|
265 |
|
|
(3 |
) |
|
409 |
|
|
- Costs incurred (development) |
|
(1,740 |
) |
|
(864 |
) |
|
(1,835 |
) |
|
– |
|
|
(4,439 |
) |
|
- Costs incurred (exploration) |
|
(130 |
) |
|
(96 |
) |
|
(115 |
) |
|
– |
|
|
(341 |
) |
|
After-tax cash |
|
3,294 |
|
|
503 |
|
|
1,271 |
|
|
(1 |
) |
|
5,067 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on Average Net Capitalized Costs |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capitalized costs |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2008 |
|
17,729 |
|
|
3,484 |
|
|
5,882 |
|
|
4 |
|
|
27,099 |
|
|
2007 |
|
13,782 |
|
|
3,490 |
|
|
4,895 |
|
|
– |
|
|
22,167 |
|
|
Average |
|
15,756 |
|
|
3,487 |
|
|
5,389 |
|
|
2 |
|
|
24,633 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
After-tax income |
|
3,977 |
|
|
480 |
|
|
2,196 |
|
|
2 |
|
|
6,655 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return % |
|
25% |
|
14% |
|
41% |
|
|
|
27% | |||||
Chemicals Free Cash Flow
Reconciliation to Generally Accepted Accounting Principles (GAAP)
($ Millions)
|
|
2004 |
2005 |
2006 |
2007 |
2008 | |||||
|
Occidental Petroleum Consolidated Statement of Cash Flows | ||||||||||
|
Cash flow from operating activities |
3,878 |
|
5,337 |
|
6,353 |
|
6,798 |
|
10,652 |
|
|
Cash flow from investing activities |
(2,428 |
) |
(3,161 |
) |
(4,383 |
) |
(3,128 |
) |
(9,457 |
) |
|
Cash flow from financing activities |
(821 |
) |
(1,187 |
) |
(2,819 |
) |
(3,045 |
) |
(1,382 |
) |
|
Change in cash |
629 |
|
989 |
|
(849 |
) |
625 |
|
(187 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Chemicals Free Cash Flow |
|
|
|
|
|
|
|
|
|
|
|
Core results (see reconciliation below) |
416 |
|
784 |
|
906 |
|
601 |
|
759 |
|
|
Depreciation & amortization expense |
260 |
|
268 |
|
279 |
|
304 |
|
311 |
|
|
Roundings |
– |
|
1 |
|
(2 |
) |
– |
|
– |
|
|
Capital expenditures (excluding acquisitions) |
(151 |
) |
(168 |
) |
(248 |
) |
(245 |
) |
(240 |
) |
|
Free cash flow |
525 |
|
885 |
|
935 |
|
660 |
|
830 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Core |
Cash |
Capital |
|
|
|
| |||
|
|
Results |
Flow |
Spending |
|
|
|
| |||
|
3-Year Average (2006–2008) |
755 |
|
808 |
|
244 |
|
|
|
|
|
|
5-Year Average (2004–2008) |
693 |
|
767 |
|
210 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment income |
416 |
|
614 |
|
906 |
|
601 |
|
669 |
|
|
Add: significant items affecting earnings |
|
|
|
|
|
|
|
|
|
|
|
Plant closure and impairments |
– |
|
– |
|
– |
|
– |
|
90 |
|
|
Hurricane insurance charges |
– |
|
11 |
|
– |
|
– |
|
– |
|
|
Write-off of plants |
– |
|
159 |
|
– |
|
– |
|
– |
|
|
Core results |
416 |
|
784 |
|
906 |
|
601 |
|
759 |
|
|
|
|
|
|
|
|
|
|
|
|
|