View Filing Data

Comprehensive income attributable to common stock

^[4]

(19)

$ 4,579

$ 6,812

$ 4,602

[1]	Net of tax of $(9), $(7) and $(20) in 2012, 2011 and 2010, respectively.
[2]	Net of tax of $(8), $34 and $30 in 2012, 2011 and 2010, respectively.
[3]	Net of tax of $14, $(56) and $(47) in 2012, 2011 and 2010, respectively.
[4]	There were no other comprehensive income (loss) items related to noncontrolling interests in 2012, 2011 and 2010.

The change in equity [net assets] of a business enterprise during a period from transactions and other events and circumstances from non-owner sources which are attributable to the reporting entity. It includes all changes in equity during a period except those resulting from investments by owners and distributions to owners, but excludes any and all transactions which are directly or indirectly attributable to that ownership interest in subsidiary equity which is not attributable to the parent.

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher AICPA
-Name Accounting Research Bulletin (ARB)
-Number 51
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Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher AICPA
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-Number 51
-Paragraph A5
-Appendix A

Reference 4: http://www.xbrl.org/2003/role/presentationRef
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-URI http://asc.fasb.org/extlink&oid=6920043&loc=d3e557-108580

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Net Income
-URI http://asc.fasb.org/extlink&oid=6518256

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Other Comprehensive Income
-URI http://asc.fasb.org/extlink&oid=6519514

Reference 7: http://www.xbrl.org/2003/role/presentationRef
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Reference 8: http://www.xbrl.org/2003/role/presentationRef
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-URI http://asc.fasb.org/extlink&oid=6508144

Reference 9: http://www.xbrl.org/2003/role/presentationRef
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The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Reference 2: http://www.xbrl.org/2003/role/presentationRef
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Reference 3: http://www.xbrl.org/2003/role/presentationRef
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Reference 4: http://www.xbrl.org/2003/role/presentationRef
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Reference 5: http://www.xbrl.org/2003/role/presentationRef
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-Number 210
-Article 5
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-Paragraph 19

Reference 6: http://www.xbrl.org/2003/role/presentationRef
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Reference 8: http://www.xbrl.org/2003/role/presentationRef
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-URI http://asc.fasb.org/extlink&oid=6518256

Reference 9: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
-Glossary Other Comprehensive Income
-URI http://asc.fasb.org/extlink&oid=6519514

Reference 10: http://www.xbrl.org/2003/role/presentationRef
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-URI http://asc.fasb.org/extlink&oid=6371337&loc=d3e3550-109257

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Reference 16: http://www.xbrl.org/2003/role/presentationRef
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The accumulated change in the value of either the projected benefit obligation or the plan assets resulting from experience different from that assumed or from a change in an actuarial assumption that has not been recognized in net periodic benefit cost, after tax.

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Reference 3: http://www.xbrl.org/2003/role/presentationRef
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Reference 8: http://www.xbrl.org/2003/role/presentationRef
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Change in the balance sheet adjustment that results from the process of translating subsidiary financial statements and foreign equity investments into functional currency of the reporting entity for the period being reported, net of tax. If an entity's functional currency is a foreign currency, translation adjustments result from the process of translating that entity's financial statements into the reporting currency. Includes gain (loss) on foreign currency forward exchange contracts. Includes foreign currency transactions designated as hedges of net investment in a foreign entity and intercompany foreign currency transactions that are of a long-term nature, when the entities to the transaction are consolidated, combined, or accounted for by the equity method in the reporting enterprise's financial statements. Includes the gain (loss) on a derivative instrument or nonderivative financial instrument that may give rise to a foreign currency transaction gain (loss) and that have been designated and have qualified as hedging instruments for hedges of the foreign currency exposure of a net investment in a foreign operation.

This element represents Other Comprehensive Income or Loss, Net of Tax, for the period attributable to the parent entity. Includes deferred gains or losses on qualifying hedges, unrealized holding gains or losses on available-for-sale securities, minimum pension liability, and cumulative translation adjustment.

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Net of tax effect of the reclassification adjustment for accumulated gains and losses from derivative instrument designated and qualifying as the effective portion of cash flow hedges included in accumulated comprehensive income that was realized in net income during the period.

Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Change in accumulated gains and losses from derivative instrument designated and qualifying as the effective portion of cash flow hedges, net of tax effect. The after tax effect change includes an entity's share of an equity investee's Increase or Decrease in deferred hedging gains or losses.

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Increase (Decrease) in Stockholders' Equity

Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Consolidated Statements of Comprehensive Income
Unrealized gains on derivatives, tax	$ (9)	$ (7)	$ (20)
Pension and postretirement gains (losses), tax	(8)	34	30
Reclassification to income of realized (gains) losses on derivatives, tax	$ 14	$ (56)	$ (47)

Consolidated Statements of Stockholders' Equity - USD ($)
$ in Millions

Total

Common Stock

Treasury Stock

Additional Paid-in Capital

Retained Earnings

Accumulated Other Comprehensive Income (Loss)

Noncontrolling Interest

Balance at Dec. 31, 2009

$ 29,159

$ 177

$ (4,161)

$ 7,127

$ 26,534

$ (596)

$ 78

Net income

4,602

4,530

Dividends on common stock

^[1]

(1,196)

Issuance of common stock and other, net

Noncontrolling interest distributions and other

(150)

^[2]

Purchases of treasury stock

(67)

Balance at Dec. 31, 2010

32,484

177

(4,228)

7,191

29,868

(524)

Increase (Decrease) in Stockholders' Equity

Net income

6,771

Dividends on common stock

^[1]

(1,497)

Issuance of common stock and other, net

Purchases of treasury stock

(274)

Balance at Dec. 31, 2011

37,620

177

(4,502)

7,286

35,142

(483)

Increase (Decrease) in Stockholders' Equity

Net income

4,598

Dividends on common stock

(19)

^[1]

(19)

(1,750)

Issuance of common stock and other, net

156

155

Noncontrolling interest contributions

^[3]

Purchases of treasury stock

(589)

Balance at Dec. 31, 2012

$ 40,048

$ 178

$ (5,091)

$ 7,441

$ 37,990

$ (502)

$ 32

[1]	There were no other comprehensive income (loss) items related to noncontrolling interests in 2012, 2011 and 2010.
[2]	On December 31, 2010, Occidental restructured its Colombian operations to take a direct working interest in the related assets.
[3]	Reflects contributions from the noncontrolling interest in a pipeline company.

The consolidated profit or loss for the period, net of income taxes, including the portion attributable to the noncontrolling interest.

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Total of Stockholders' Equity (deficit) items, net of receivables from officers, directors, owners, and affiliates of the entity including portions attributable to both the parent and noncontrolling interests (previously referred to as minority interest), if any. The entity including portions attributable to the parent and noncontrolling interests is sometimes referred to as the economic entity. This excludes temporary equity and is sometimes called permanent equity.

Equity impact of the cost of common and preferred stock that were repurchased during the period. Recorded using the cost method.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Consolidated Statements of Cash Flows - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
CASH FLOW FROM OPERATING ACTIVITIES
Net income	$ 4,598	$ 6,771	$ 4,602
Adjustments to reconcile net income to net cash provided by operating activities:
Discontinued operations, net	37	(131)	39
Depreciation, depletion and amortization of assets	4,511	3,591	3,153
Deferred income tax provision	1,128	1,436	406
Other noncash charges to income	195	190	231
Asset impairments and related items	1,751		275
Undistributed earnings from equity investments	(30)	(33)	(60)
Dry hole expenses	279	160	139
Changes in operating assets and liabilities:
Decrease (increase) in receivables	472	(360)	(929)
(Increase) decrease in inventories	(265)	(50)	(42)
Decrease in other current assets	127	95	210
(Decrease) increase in accounts payable and accrued liabilities	(1,086)	657	1,146
Increase (decrease) in current domestic and foreign income taxes	1	(174)	186
Other operating, net	(370)	154
Operating cash flow from continuing operations	11,348	12,306	9,356
Operating cash flow from discontinued operations, net of taxes	(36)	(25)	210
Net cash provided by operating activities	11,312	12,281	9,566
CASH FLOW FROM INVESTING ACTIVITIES
Capital expenditures	(10,226)	(7,518)	(3,940)
Payments for purchases of assets and businesses	(2,490)	(4,909)	(4,924)
Sales of assets, net	4	50	20
Other, net	57	(96)	(36)
Investing cash flow from continuing operations	(12,655)	(12,473)	(8,880)
Investing cash flow from discontinued operations		2,570	(415)
Net cash used by investing activities	(12,655)	(9,903)	(9,295)
CASH FLOW FROM FINANCING ACTIVITIES
Proceeds from long-term debt	1,736	2,111	2,584
Payments of long-term debt		(1,523)	(311)
Proceeds from issuance of common stock	85	50	10
Purchases of treasury stock	(583)	(274)	(67)
Contributions from (distributions to) noncontrolling interest	32	(121)
Cash dividends paid	(2,128)	(1,436)	(1,159)
Other, net	12	18	26
Net cash (used) provided by financing activities	(846)	(1,175)	1,083
(Decrease) increase in cash and cash equivalents	(2,189)	1,203	1,354
Cash and cash equivalents - beginning of year	3,781	2,578	1,224
Cash and cash equivalents - end of year	$ 1,592	$ 3,781	$ 2,578

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

12 Months Ended

Dec. 31, 2012

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 1

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NATURE OF OPERATIONS

In this report, “Occidental” means Occidental Petroleum Corporation, a Delaware corporation (OPC), or OPC and one or more entities in which it owns a controlling interest (subsidiaries). Occidental conducts its operations through various subsidiaries and affiliates. Occidental’s principal businesses consist of the oil and gas, chemical and midstream, marketing and other (midstream and marketing) segments. The oil and gas segment explores for, develops and produces oil and condensate, natural gas liquids (NGLs) and natural gas. The chemical segment (OxyChem) mainly manufactures and markets basic chemicals and vinyls. The midstream and marketing segment gathers, processes, transports, stores, purchases and markets oil, condensate, NGLs, natural gas, carbon dioxide (CO2) and power. It also trades around its assets, including transportation and storage capacity, and trades oil, NGLs, gas and other commodities. The segment also invests in entities that conduct similar activities.

PRINCIPLES OF CONSOLIDATION

The consolidated financial statements have been prepared in conformity with United States generally accepted accounting principles (GAAP) and include the accounts of OPC, its subsidiaries and its undivided interests in oil and gas exploration and production ventures. Occidental accounts for its share of oil and gas exploration and production ventures, in which it has a direct working interest, by reporting its proportionate share of assets, liabilities, revenues, costs and cash flows within the relevant lines on the balance sheets, income statements and cash flow statements.

Certain financial statements, notes and supplementary data for prior years have been reclassified to conform to the 2012 presentation.

INVESTMENTS IN UNCONSOLIDATED ENTITIES

Occidental’s percentage interest in the underlying net assets of affiliates as to which it exercises significant influence without having a controlling interest (excluding oil and gas ventures in which Occidental holds an undivided interest) are accounted for under the equity method. Occidental reviews equity-method investments for impairment whenever events or changes in circumstances indicate that an other-than-temporary decline in value may have occurred. The amount of impairment, if any, is based on quoted market prices, when available, or other valuation techniques, including discounted cash flows.

REVENUE RECOGNITION

Revenue is recognized from oil and gas production when title has passed to the customer, which occurs when the product is shipped. In international locations where oil is shipped by tanker, title passes when the tanker is loaded or product is received by the customer, depending on the shipping terms. This process occasionally causes a difference between actual production in a reporting period and sales volumes that have been recognized as revenue.

Revenue from chemical product sales is recognized when the product is shipped and title has passed to the customer. Certain incentive programs may provide for payments or credits to be made to customers based on the volume of product purchased over a defined period. Total customer incentive payments over a given period are estimated and recorded as a reduction to revenue ratably over the contract period. Such estimates are evaluated and revised as warranted.

Revenue from marketing and trading activities is recognized on net settled transactions upon completion of contract terms and, for physical deliveries, upon title transfer. For unsettled transactions, contracts are recorded at fair value and changes in fair value are reflected in net sales. Revenue from all marketing and trading activities is reported on a net basis.

Occidental records revenue net of any taxes, such as sales taxes, that are assessed by governmental authorities on Occidental’s customers.

RISKS AND UNCERTAINTIES

The process of preparing consolidated financial statements in conformity with GAAP requires Occidental’s management to make informed estimates and judgments regarding certain types of financial statement balances and disclosures. Such estimates primarily relate to unsettled transactions and events as of the date of the consolidated financial statements and judgments on the materiality of transactions and balances. Changes in facts and circumstances or discovery of new information relating to such transactions and events may result in revised estimates and judgments and actual results may differ from estimates upon settlement but generally not by material amounts. Management believes that these estimates and judgments provide a reasonable basis for the fair presentation of Occidental’s financial statements.

Occidental establishes a valuation allowance against net operating losses and other deferred tax assets to the extent it believes the future benefit from these assets will not be realized in the statutory carryforward periods. Realization of deferred tax assets, including any net operating loss carryforwards, is dependent upon Occidental generating sufficient future taxable income and reversal of temporary differences in jurisdictions where such assets originate.

The accompanying consolidated financial statements include assets of approximately $12.3 billion as of December 31, 2012, and net sales of approximately $8.8 billion for the year ended December 31, 2012, relating to Occidental’s operations in countries outside North America. Occidental operates some of its oil and gas business in countries that occasionally have experienced political instability, nationalizations, armed conflict, terrorism, insurgency, civil unrest, security problems, labor unrest, OPEC production restrictions, equipment import restrictions and sanctions, all of which increase Occidental’s risk of loss or delayed or restricted production or may result in other adverse consequences. Occidental attempts to conduct its affairs so as to mitigate its exposure to such risks and would seek compensation in the event of nationalization.

Because Occidental’s major products are commodities, significant changes in the prices of oil and gas and chemical products may have a significant impact on Occidental’s results of operations.

Also, see “Property, Plant and Equipment” below.

CASH AND CASH EQUIVALENTS

Cash equivalents are short-term, highly liquid investments that are readily convertible to cash. Cash equivalents were approximately $1.0 billion and $3.5 billion at December 31, 2012 and 2011, respectively.

Investments

Available-for-sale securities are recorded at fair value with any unrealized gains or losses included in accumulated other comprehensive income/loss (AOCI). Trading securities are recorded at fair value with unrealized and realized gains or losses included in net sales.

Inventories

Materials and supplies are valued at weighted-average cost and are reviewed periodically for obsolescence. Oil, NGL and natural gas inventories are valued at the lower of cost or market.

For the chemical segment, Occidental’s finished goods inventories are valued at the lower of cost or market. For most of its domestic inventories, other than materials and supplies, the chemical segment uses the last-in, first-out (LIFO) method as it better matches current costs and current revenue. For other countries, Occidental uses the first-in, first-out method (if the costs of goods are specifically identifiable) or the average-cost method (if the costs of goods are not specifically identifiable).

PROPERTY, PLANT AND EQUIPMENT

Oil and Gas

The carrying value of Occidental’s property, plant and equipment (PP&E) represents the cost incurred to acquire or develop the asset, including any asset retirement obligations and capitalized interest, net of accumulated depreciation, depletion and amortization (DD&A) and net of any impairment charges. For assets acquired, PP&E cost is based on fair values at the acquisition date. Asset retirement obligations and interest costs incurred in connection with qualifying capital expenditures are capitalized and amortized over the lives of the related assets.

Occidental uses the successful efforts method to account for its oil and gas properties. Under this method, Occidental capitalizes costs of acquiring properties, costs of drilling successful exploration wells and development costs. The costs of exploratory wells are initially capitalized pending a determination of whether proved reserves have been found. If proved reserves have been found, the costs of exploratory wells remain capitalized. Otherwise, Occidental charges the costs of the related wells to expense. In some cases, a determination of proved reserves cannot be made at the completion of drilling, requiring additional testing and evaluation of the wells. Occidental generally expenses the costs of such exploratory wells if a determination of proved reserves has not been made within a 12-month period after drilling is complete.

The following table summarizes the activity of capitalized exploratory well costs for continuing operations for the years ended December 31:

In millions	2012			2011			2010
Balance — Beginning of Year	$	182		$	73		$	51
Additions to capitalized exploratory well costs pending the determination of proved reserves	400			334			112
Reclassifications to property, plant and equipment based on the determination of proved reserves	(407		)	(204		)	(73		)
Capitalized exploratory well costs charged to expense	(77		)	(21		)	(17		)
Balance — End of Year	$	98		$	182		$	73

Occidental expenses annual lease rentals and geological, geophysical and seismic costs as incurred.

Occidental expenses the costs of injectants used in production.

Occidental determines depreciation and depletion of oil and gas producing properties by the unit-of-production method. It amortizes acquisition costs over total proved reserves, and capitalized development and successful exploration costs over proved developed reserves.

Proved oil and gas reserves (as defined in the Securities and Exchange Commission’s Regulation S-X, Rule 4-10(a)) are those quantities of oil and gas, which, by analysis of geoscience and engineering data, can be estimated with reasonable certainty to be economically producible—from a given date forward, from known reservoirs, and under existing economic conditions, operating methods, and government regulations—prior to the time at which contracts providing the right to operate expire, unless evidence indicates that renewal is reasonably certain, regardless of whether deterministic or probabilistic methods are used for the estimation. Occidental has no proved oil and gas reserves for which the determination of economic producibility is subject to the completion of major additional capital expenditures.

A portion of the carrying value of Occidental’s oil and gas properties is attributable to unproved properties. At December 31, 2012, the net capitalized costs attributable to unproved properties were $4.8 billion. The unproved amounts are not subject to DD&A until they are classified as proved properties. As exploration and development work progresses, if reserves on these properties are proved, capitalized costs attributable to the properties become subject to DD&A. If the exploration and development work were to be unsuccessful, or management’s plans changed with respect to these properties, as a result of economic, operating or contractual conditions, the capitalized costs of the related properties would be expensed. The timing of any writedowns of these unproved properties, if warranted, depends upon management’s plans, the nature, timing and extent of future exploration and development activities and their results. Occidental believes its current plans and exploration and development efforts will allow it to realize its unproved property balance.

Additionally, Occidental performs impairment tests with respect to its proved properties generally when prices decline other than temporarily, reserve estimates change significantly or other significant events occur that may impact its ability to realize the recorded asset amounts. Impairment tests incorporate a number of assumptions involving expectations of future cash flows, which can change significantly over time. These assumptions include estimates of future product prices, which Occidental bases on forward price curves and, when applicable, contractual prices, estimates of oil and gas reserves and estimates of future expected operating and development costs.

Fluctuations in commodity prices and production and development costs could cause management’s plans to change with respect to unproved properties and could cause the carrying values of proved properties to be unrealizable. Such circumstances could result in impairments in the carrying values of proved or unproved properties or both. Any impairment loss would be calculated as the excess of the asset’s net book value over its estimated fair value.

Chemical

Occidental’s chemical assets are depreciated using either the unit-of-production or the straight-line method, based upon the estimated useful lives of the facilities. The estimated useful lives of Occidental’s chemical assets, which range from three years to 50 years, are also used for impairment tests. The estimated useful lives for the chemical facilities are based on the assumption that Occidental will provide an appropriate level of annual expenditures to ensure productive capacity is sustained. Such expenditures consist of ongoing routine repairs and maintenance, as well as planned major maintenance activities (PMMA). Ongoing routine repairs and maintenance expenditures are expensed as incurred. PMMA costs are capitalized and amortized over the period until the next planned overhaul. Additionally, Occidental incurs capital expenditures that extend the remaining useful lives of existing assets, increase their capacity or operating efficiency beyond the original specification or add value through modification for a different use. These capital expenditures are not considered in the initial determination of the useful lives of these assets at the time they are placed into service. The resulting revision, if any, of the asset’s estimated useful life is measured and accounted for prospectively.

Without these continued expenditures, the useful lives of these assets could decrease significantly. Other factors that could change the estimated useful lives of Occidental’s chemical assets include sustained higher or lower product prices, which are particularly affected by both domestic and foreign competition, demand, feedstock costs, energy prices, environmental regulations and technological changes.

Occidental performs impairment tests on its chemical assets whenever events or changes in circumstances lead to a reduction in the estimated useful lives or estimated future cash flows that would indicate that the carrying amount may not be recoverable, or when management’s plans change with respect to those assets. Any impairment loss would be calculated as the excess of the asset’s net book value over its estimated fair value.

Midstream and Marketing

Occidental’s midstream and marketing PP&E is depreciated over the estimated useful lives of the assets, using either the unit-of-production or straight-line method.

Occidental performs impairment tests on its midstream and marketing assets whenever events or changes in circumstances lead to a reduction in the estimated useful lives or estimated future cash flows that would indicate that the carrying amount may not be recoverable, or when management’s plans change with respect to those assets. Any impairment loss would be calculated as the excess of the asset’s net book value over its estimated fair value.

FAIR VALUE MEASUREMENTS

Occidental has categorized its assets and liabilities that are measured at fair value in a three-level fair value hierarchy, based on the inputs to the valuation techniques: Level 1 — using quoted prices in active markets for identical assets or liabilities; Level 2 — using observable inputs other than quoted prices for identical assets or liabilities; and Level 3 — using unobservable inputs. Transfers between levels, if any, are reported at the end of each reporting period.

Fair Values - Recurring

Occidental primarily applies the market approach for recurring fair value measurements, maximizes its use of observable inputs and minimizes its use of unobservable inputs. Occidental utilizes the mid-point price between bid and ask prices for valuing the majority of its assets and liabilities measured and reported at fair value. In addition to using market data, Occidental makes assumptions in valuing its assets and liabilities, including assumptions about the risks inherent in the inputs to the valuation technique. For assets and liabilities carried at fair value, Occidental measures fair value using the following methods:

Ø Commodity derivatives — Occidental values exchange-cleared commodity derivatives using closing prices provided by the exchange as of the balance sheet date. These derivatives are classified as Level 1. Over-the-Counter (OTC) bilateral financial commodity contracts, foreign exchange contracts, options and physical commodity forward purchase and sale contracts are generally valued using quotations provided by brokers or industry-standard models that consider various inputs, including quoted forward prices for commodities, time value, volatility factors, credit risk and current market and contractual prices for the underlying instruments, as well as other relevant economic measures. Substantially all of these inputs are observable in the marketplace throughout the full term of the instrument and can be derived from observable data or are supported by observable prices at which transactions are executed in the marketplace. Occidental classifies these measurements as Level 2.

Ø Embedded commodity derivatives — Occidental values embedded commodity derivatives based on a market approach that considers various assumptions, including quoted forward commodity prices and market yield curves. The assumptions used include inputs that are observable and unobservable in the marketplace, and the fair value is designated as Level 3 within the valuation hierarchy.

Occidental generally uses an income approach to measure fair value when there is not a market-observable price for an identical or similar asset or liability. This approach utilizes management’s judgments regarding expectations of projected cash flows, and discounts those cash flows using a risk-adjusted discount rate.

ACCRUED LIABILITIES—CURRENT

Accrued liabilities include accrued payroll, commissions and related expenses of $385 million and $462 million at December 31, 2012 and 2011, respectively.

ENVIRONMENTAL LIABILITIES AND EXPENDITURES

Environmental expenditures that relate to current operations are expensed or capitalized as appropriate. Occidental records environmental reserves for estimated remediation costs that relate to existing conditions from past operations when environmental remediation efforts are probable and the costs can be reasonably estimated. In determining the reserves and the range of reasonably possible additional losses, Occidental refers to currently available information, including relevant past experience, remedial objectives, available technologies, applicable laws and regulations and cost-sharing arrangements. Occidental bases environmental reserves on management’s estimate of the most likely cost to be incurred, using the most cost-effective technology reasonably expected to achieve the remedial objective. Occidental periodically reviews reserves and adjusts them as new information becomes available. Occidental records environmental reserves on a discounted basis when it deems the aggregate amount and timing of cash payments to be reliably determinable at the time the reserves are established. The reserve methodology with respect to discounting for a specific site is not modified once it is established. The amount of discounted environmental reserves is insignificant. Occidental generally records reimbursements or recoveries of environmental remediation costs in income when received, or when receipt of recovery is highly probable. As of December 31, 2012, 2011 and 2010, Occidental did not have any accruals for reimbursements or recoveries.

Many factors could affect Occidental’s future remediation costs and result in adjustments to its environmental reserves and range of reasonably possible additional losses. The most significant are: (1) cost estimates for remedial activities may be inaccurate; (2) the length of time, type or amount of remediation necessary to achieve the remedial objective may change due to factors such as site conditions, the ability to identify and control contaminant sources or the discovery of additional contamination; (3) a regulatory agency may ultimately reject or modify Occidental’s proposed remedial plan; (4) improved or alternative remediation technologies may change remediation costs; (5) laws and regulations may change remediation requirements or affect cost sharing or allocation of liability; and (6) changes in allocation or cost-sharing arrangements.

Certain sites involve multiple parties with various cost-sharing arrangements, which fall into the following three categories: (1) environmental proceedings that result in a negotiated or prescribed allocation of remediation costs among Occidental and other alleged potentially responsible parties; (2) oil and gas ventures in which each participant pays its proportionate share of remediation costs reflecting its working interest; or (3) contractual arrangements, typically relating to purchases and sales of properties, in which the parties to the transaction agree to methods of allocating remediation costs. In these circumstances, Occidental evaluates the financial viability of the other parties with whom it is alleged to be jointly liable, the degree of their commitment to participate and the consequences to Occidental of their failure to participate when estimating Occidental’s ultimate share of liability. Occidental records reserves at its expected net cost of remedial activities and, based on these factors, believes that it will not be required to assume a share of liability of such other potentially responsible parties in an amount materially above amounts reserved.

In addition to the costs of investigations and cleanup measures, which often take in excess of 10 years at Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) National Priorities List (NPL) sites, Occidental’s reserves include management’s estimates of the costs to operate and maintain remedial systems. If remedial systems are modified over time in response to significant changes in site-specific data, laws, regulations, technologies or engineering estimates, Occidental reviews and adjusts its reserves accordingly.

ASSET RETIREMENT OBLIGATIONS

Occidental recognizes the fair value of asset retirement obligations in the period in which a determination is made that a legal obligation exists to dismantle an asset and reclaim or remediate the property at the end of its useful life and the cost of the obligation can be reasonably estimated. The liability amounts are based on future retirement cost estimates and incorporate many assumptions such as time to abandonment, technological changes, future inflation rates and the risk-adjusted discount rate. When the liability is initially recorded, Occidental capitalizes the cost by increasing the related PP&E balances. If the estimated future cost of the asset retirement obligation changes, Occidental records an adjustment to both the asset retirement obligation and PP&E. Over time, the liability is increased and expense is recognized for accretion, and the capitalized cost is depreciated over the useful life of the asset.

At a certain number of its facilities, Occidental has identified conditional asset retirement obligations that are related mainly to plant decommissioning. Occidental believes that there is an indeterminate settlement date for these asset retirement obligations because the range of time over which Occidental may settle these obligations is unknown or cannot be estimated. Therefore, Occidental cannot reasonably estimate the fair value of these liabilities. Occidental will recognize these conditional asset retirement obligations in the periods in which sufficient information becomes available to reasonably estimate their fair values.

The following table summarizes the activity of the asset retirement obligation, of which $1,212 million and $1,030 million is included in deferred credits and other liabilities - other, with the remaining current portion in accrued liabilities at December 31, 2012 and 2011, respectively.

For the years ended December 31, (in millions)	2012			2011
Beginning balance	$	1,089		$	800
Liabilities incurred - capitalized to PP&E	86			74
Liabilities settled and paid	(58		)	(53		)
Accretion expense	61			48
Acquisitions and other - capitalized to PP&E	50			177
Revisions to estimated cash flows - capitalized to PP&E	38			43
Ending balance	$	1,266		$	1,089

DERIVATIVE INSTRUMENTS

Derivatives are carried at fair value and on a net basis when a legal right of offset exists with the same counterparty. Occidental applies hedge accounting when transactions meet specified criteria for cash-flow hedge treatment and management elects and documents such treatment. Otherwise, any fair value gains or losses are recognized in earnings in the current period. For cash-flow hedges, the gain or loss on the effective portion of the derivative is reported as a component of other comprehensive income (OCI) with an offsetting adjustment to the basis of the item being hedged. Realized gains or losses from cash-flow hedges, and any ineffective portion, are recorded as a component of net sales in the consolidated statements of income. Ineffectiveness is primarily created by a basis difference between the hedged item and the hedging instrument due to location, quality or grade of the physical commodity underlying the hedging instrument. Gains and losses from derivative instruments are reported net in the consolidated statements of income. There were no fair value hedges as of and during the years ended December 31, 2012, 2011 and 2010.

A hedge is regarded as highly effective such that it qualifies for hedge accounting if, at inception and throughout its life, it is expected that changes in the fair value or cash flows of the hedged item will be offset by 80 to 125 percent of the changes in the fair value or cash flows, respectively, of the hedging instrument. In the case of hedging a forecast transaction, the transaction must be probable and must present an exposure to variations in cash flows that could ultimately affect reported net income or loss. Occidental discontinues hedge accounting when it determines that a derivative has ceased to be highly effective as a hedge; when the hedged item matures or is sold or repaid; or when a forecast transaction is no longer deemed probable.

STOCK-BASED INCENTIVE PLANS

Occidental has established several stockholder-approved stock-based incentive plans for certain employees and directors (Plans) that are more fully described in Note 12. A summary of Occidental’s accounting policy for awards issued under the Plans follows.

For cash- and stock-settled restricted stock units or incentive award shares (RSUs), compensation value is initially measured on the grant date using the quoted market price of Occidental’s common stock. For total shareholder return incentives (TSRIs), compensation value is initially measured on the grant date using estimated payout levels derived from the Monte Carlo valuation model. Compensation expense for RSUs and TSRIs is recognized on a straight-line basis over the requisite service periods, which is generally over the awards’ respective vesting or performance periods. Compensation expense for the cash-settled portion of TSRIs and related dividends is adjusted quarterly for any changes in the number of shares expected to be issued based on the performance criteria using the Monte Carlo valuation model. In addition, every quarter, compensation expense for the cash-settled portion of RSUs and TSRIs is adjusted for changes in the value of the underlying stock. All such performance or stock-price-related changes are recognized in periodic compensation expense. The stock-settled portion of all these awards is expensed using the initially measured compensation value.

EARNINGS PER SHARE

Occidental’s instruments containing rights to nonforfeitable dividends granted in stock-based payment transactions are considered participating securities prior to vesting and, therefore, have been included in the earnings allocations in computing basic and diluted EPS under the two-class method.

Basic EPS was computed by dividing net income attributable to common stock, net of income allocated to participating securities, by the weighted-average number of common shares outstanding during each period, net of treasury shares and including vested but unissued shares and share units. The computation of diluted EPS reflects the additional dilutive effect of stock options and unvested stock awards.

RETIREMENT AND POSTRETIREMENT BENEFIT PLANS

Occidental recognizes the overfunded or underfunded amounts of its defined benefit pension and postretirement plans in its financial statements using a December 31 measurement date.

Occidental determines its defined benefit pension and postretirement benefit plan obligations based on various assumptions and discount rates. The discount rate assumptions used are meant to reflect the interest rate at which the obligations could effectively be settled on the measurement date. Occidental estimates the rate of return on assets with regard to current market factors but within the context of historical returns. Occidental funds and expenses negotiated pension increases for domestic union employees over the terms of the applicable collective bargaining agreements.

Pension and postretirement plan assets are measured at fair value. Common stock, preferred stock, publicly registered mutual funds, U.S. government securities and corporate bonds are valued using quoted market prices in active markets when available. When quoted market prices are not available, these investments are valued using pricing models with observable inputs from both active and non-active markets. Common and collective trusts are valued at the fund units’ net asset value (NAV) provided by the issuer, which represents the quoted price in a non-active market. Short-term investment funds are valued at the fund units’ NAV provided by the issuer.

SUPPLEMENTAL CASH FLOW INFORMATION

Occidental paid United States federal, state and foreign income taxes for continuing operations of approximately $2.4 billion, $2.9 billion and $2.4 billion during the years ended December 31, 2012, 2011 and 2010, respectively. Occidental also paid production, property and other taxes of approximately $694 million, $635 million and $510 million during the years ended December 31, 2012, 2011 and 2010, respectively, substantially all of which was in the United States. Interest paid totaled approximately $190 million, $315 million and $161 million for the years 2012, 2011 and 2010, respectively. The 2011 interest paid included $154 million of debt extinguishment premiums.

FOREIGN CURRENCY TRANSACTIONS

The functional currency applicable to all of Occidental’s foreign oil and gas operations is the United States dollar since cash flows are denominated principally in United States dollars. In Occidental’s other operations, Occidental’s use of non-United States dollar functional currencies was not material for all years presented. The effect of exchange rates on transactions in foreign currencies is included in periodic income. Occidental reports the exchange rate differences arising from translating foreign currency denominated balance sheet accounts to the United States dollar as of the reporting date in other comprehensive income. Exchange-rate gains and losses for continuing operations were not material for all years presented.

ACQUISITIONS, DISPOSITIONS AND OTHER TRANSACTIONS

12 Months Ended

Dec. 31, 2012

ACQUISITIONS, DISPOSITIONS AND OTHER TRANSACTIONS

ACQUISITIONS, DISPOSITIONS AND OTHER TRANSACTIONS

NOTE 2

ACQUISITIONS, DISPOSITIONS AND OTHER TRANSACTIONS

2012

During the year ended December 31, 2012, Occidental paid approximately $2.3 billion for domestic oil and gas properties in the Permian Basin, Williston Basin, South Texas and California.

In November 2012, Occidental and Magellan Midstream Partners, L.P. (Magellan) formed BridgeTex Pipeline Company, LLC (BridgeTex) and are proceeding with the construction of the BridgeTex Pipeline, which is expected to begin service in mid-2014. The approximately 450-mile-long pipeline will be capable of transporting approximately 300,000 barrels per day of crude oil between the Permian region (Colorado City, TX) and the Gulf Coast refinery markets. The BridgeTex Pipeline project also includes construction of approximately 2.6 million barrels of oil storage in aggregate.

Occidental owns a 50% interest in BridgeTex and the remaining 50% interest is owned by Magellan, which also serves as the operator. BridgeTex was determined to be a variable interest entity because of the difference between Occidental’s economic interests and its decision-making rights. Occidental is the primary beneficiary and consequently consolidates BridgeTex. At December 31, 2012, BridgeTex held approximately $50 million of money market mutual funds, classified as cash equivalents, which approximates fair value using Level 1 inputs. BridgeTex’s assets cannot be used for the obligations of, nor do BridgeTex’s creditors have recourse to, OPC or its other subsidiaries.

2011

During the year ended December 31, 2011, Occidental acquired producing properties in South Texas for approximately $1.8 billion. Occidental also acquired approximately $2.6 billion of other domestic oil and gas assets, which included properties in California, as well as the Permian and Williston Basins.

In the first quarter of 2011, Occidental completed the sale of its Argentine oil and gas operations.

Internationally, in the first quarter of 2011, Occidental acquired a 40-percent participating interest in the Al Hosn gas project in Abu Dhabi, joining with the Abu Dhabi National Oil Company in a 30-year joint venture agreement. The project is operated by Abu Dhabi Gas Development Company Limited. In May 2011, Occidental paid approximately $500 million for its share of pre-acquisition development expenditures.

In early 2011, Occidental ceased exploration activity and its participation in production operations in Libya due to civil unrest in the country and United States sanctions. As a result, Occidental wrote off the entire amount of the capitalized and suspended exploration costs incurred to date, including lease acquisition costs, of approximately $35 million in the first quarter of 2011. The United States government lifted its sanctions in September 2011 and Occidental resumed its participation in the producing operations at that time.

2010

In December 2010, Occidental acquired oil producing and prospective properties in North Dakota for approximately $1.4 billion in cash. In 2010, Occidental also acquired various domestic oil and gas interests, in operated, producing and non-producing properties in the Permian Basin, Midcontinent region and California, for approximately $2.8 billion.

In December 2010, Occidental executed an agreement with a subsidiary of China Petrochemical Corporation (Sinopec) to sell its Argentine oil and gas operations for after-tax proceeds of approximately $2.6 billion. Occidental recorded a pre-tax gain of $225 million when the sale closed in February 2011. Net revenues and pre-tax income for discontinued operations related to Argentina were $97 million and $2 million, respectively, for the year ended December 31, 2011. Net revenues and pre-tax losses for such discontinued operations in 2010 were $700 million and $(39) million, respectively.

In December 2010, Occidental purchased additional noncontrolling interests in the general partner of Plains All-American Pipeline, L.P. (Plains Pipeline) for approximately $430 million, and now owns 35 percent of the general partner. In December 2010, Occidental also completed its acquisition of the remaining 50-percent joint venture interest in Elk Hills Power, LLC (EHP), a limited liability company that operates a gas-fired power-generation plant in California, for approximately $175 million, bringing Occidental’s total ownership to 100 percent. EHP is now consolidated in Occidental’s balance sheet.

In January 2010, Occidental and other consortium members signed a 20-year contract with the South Oil Company of Iraq to develop the Zubair Field in Iraq.

ACCOUNTING AND DISCLOSURE CHANGES

12 Months Ended

Dec. 31, 2012

ACCOUNTING AND DISCLOSURE CHANGES

ACCOUNTING AND DISCLOSURE CHANGES

NOTE 3

ACCOUNTING AND DISCLOSURE CHANGES

RECENTLY ADOPTED ACCOUNTING AND DISCLOSURE CHANGES

Fair Value Measurements

Beginning in the quarter ended March 31, 2012, Occidental enhanced its fair value measurement application and disclosures as a result of adopting new requirements issued by the Financial Accounting Standards Board in May 2011. The new rules include revisions to the standards for the use of fair value measurements and additional disclosures for: (i) all transfers between Level 1 and Level 2 of the fair value hierarchy; (ii) Level 3 measurements; and (iii) hierarchy classifications used for assets and liabilities whose fair value is disclosed only in the footnotes. The new rules did not have a material impact on Occidental.

INVENTORIES

12 Months Ended

Dec. 31, 2012

INVENTORIES

INVENTORIES

NOTE 4

INVENTORIES

Net carrying values of inventories valued under the LIFO method were approximately $185 million and $176 million at December 31, 2012 and 2011, respectively. Inventories consisted of the following:

Balance at December 31, (in millions)	2012			2011
Raw materials	$	70		$	69
Materials and supplies	612			443
Finished goods	763			655
	1,445			1,167
LIFO reserve	(101		)	(98		)
Total	$	1,344		$	1,069

LONG-TERM DEBT

12 Months Ended

Dec. 31, 2012

LONG-TERM DEBT

LONG-TERM DEBT

NOTE 5

LONG-TERM DEBT

Long-term debt consisted of the following:

Balance at December 31, (in millions)	2012			2011
4.10% senior notes due 2021	$	1,300		$	1,300
1.75% senior notes due 2017	1,250			1,250
2.70% senior notes due 2023	1,250			—
3.125% senior notes due 2022	900			900
4.125% senior notes due 2016	750			750
2.5% senior notes due 2016	700			700
1.45% senior notes due 2013	600			600
1.50% senior notes due 2018	500			—
8.45% senior notes due 2029	116			116
9.25% senior debentures due 2019	116			116
7.2% senior debentures due 2028	82			82
Variable rate bonds due 2030 (0.13% and 0.11% as of December 31, 2012 and 2011, respectively)	68			68
8.75% medium-term notes due 2023	22			22
	7,654			5,904
Less:
Unamortized discount, net	(31		)	(33		)
Current maturities	(600		)	—
Total	$	7,023		$	5,871

Occidental has a bank credit facility (Credit Facility) with a $2.0 billion commitment expiring in 2016. No amounts have been drawn under this Credit Facility. Up to $1.0 billion of the Credit Facility is available in the form of letters of credit. Borrowings under the Credit Facility bear interest at various benchmark rates, including LIBOR, plus a margin based on Occidental’s senior debt ratings. Additionally, Occidental paid average annual facility fees of 0.08 percent in 2012 on the total commitment amounts of the Credit Facility.

The Credit Facility provides for the termination of loan commitments and requires immediate repayment of any outstanding amounts if certain events of default occur. The Credit Facility and other debt agreements do not contain material adverse change clauses or debt ratings triggers that could restrict Occidental’s ability to borrow or that would permit lenders to terminate their commitments or accelerate debt.

As of December 31, 2012, under the most restrictive covenants of its financing agreements, Occidental had substantial capacity for additional unsecured borrowings, the payment of cash dividends and other distributions on, or acquisitions of, Occidental stock.

In June 2012, Occidental issued $1.75 billion of debt which comprised $1.25 billion of 2.70-percent senior unsecured notes due 2023 and $500 million of 1.50-percent senior unsecured notes due 2018. Occidental received net proceeds of approximately $1.74 billion. Interest on the notes will be payable semi-annually in arrears in February and August for each series of notes.

In August 2011, Occidental issued $2.15 billion of debt, which comprised $1.25 billion of 1.75-percent senior unsecured notes due 2017 and $900 million of 3.125-percent senior unsecured notes due 2022. Occidental received net proceeds of approximately $2.1 billion. Interest on the notes is payable semi-annually in arrears in February and August for each series of notes.

In March 2011, Occidental redeemed all $1.0 billion of its outstanding 7-percent senior notes due 2013 and all $368 million of its outstanding 6.75-percent senior notes due 2012. Occidental recorded a $163 million pre-tax charge related to this redemption in the first quarter of 2011.

In December 2010, Occidental issued $2.6 billion of debt, which comprised $600 million of 1.45-percent senior unsecured notes due 2013, $700 million of 2.50-percent senior unsecured notes due 2016 and $1.3 billion of 4.10-percent senior unsecured notes due 2021. Occidental received net proceeds of approximately $2.6 billion. Interest on the notes is payable semi-annually in arrears in June and December of each year for the 1.45-percent notes and February and August of each year for the other notes.

Occidental has provided guarantees on Dolphin Energy’s debt, which are limited to certain political and other events. At December 31, 2012 and 2011, Occidental’s total guarantees were not material and a substantial majority of the amounts consisted of limited recourse guarantees on approximately $370 million and $300 million, respectively, of Dolphin’s debt, of which the fair value was immaterial.

At December 31, 2012, principal payments on long-term debt aggregated $7.6 billion, of which $0.6 billion is due in 2013, $0.0 billion in 2014, $0.0 billion in 2015, $1.4 billion in 2016, $1.2 billion in 2017 and $4.4 billion in 2018 and thereafter.

Occidental estimates the fair value of fixed-rate debt based on the quoted market prices for those instruments or on quoted market yields for similarly rated debt instruments, taking into account such instruments’ maturities. The estimated fair values of Occidental’s debt at December 31, 2012 and 2011, which were classified as Level 1, were approximately $8.2 billion and $6.4 billion, respectively, compared to carrying values of approximately $7.6 billion and $5.9 billion, respectively. Occidental’s exposure to changes in interest rates relates primarily to its variable-rate, long-term debt obligations, and is not material. As of December 31, 2012 and 2011, variable-rate debt constituted approximately 1 percent of Occidental’s total debt.

LEASE COMMITMENTS

12 Months Ended

Dec. 31, 2012

LEASE COMMITMENTS

LEASE COMMITMENTS

NOTE 6

LEASE COMMITMENTS

Operating lease agreements include leases for transportation equipment, power plants, machinery, terminals, storage facilities, land and office space. Occidental’s operating lease agreements frequently include renewal or purchase options and require it to pay for utilities, taxes, insurance and maintenance expense. At December 31, 2012, future net minimum lease payments for noncancelable operating leases (excluding oil and gas and other mineral leases, utilities, taxes, insurance and maintenance expense) were the following:

In millions	Amount (a)
2013	$	158
2014	105
2015	106
2016	88
2017	59
Thereafter	460
Total minimum lease payments	$	976

(a) These amounts are net of sublease rentals of $3 million, which are to be received as follows (in millions): 2013—$2 and 2014—$1.

Rental expense for operating leases, net of sublease rental income for continuing operations, was $176 million in 2012, $179 million in 2011 and $170 million in 2010. Rental expense was net of sublease income of $4 million each in 2012, 2011 and 2010.

The entire disclosure for lessee entity's leasing arrangements including, but not limited to, all of the following: (a.) The basis on which contingent rental payments are determined, (b.) The existence and terms of renewal or purchase options and escalation clauses, (c.) Restrictions imposed by lease agreements, such as those concerning dividends, additional debt, and further leasing.

DERIVATIVES

12 Months Ended

Dec. 31, 2012

DERIVATIVES

DERIVATIVES

NOTE 7

DERIVATIVES

Objective & Strategy

Occidental uses a variety of derivative instruments, including cash-flow hedges and derivative instruments not designated as hedging instruments, to establish, as of the date of production, the price it receives and to improve realized prices for oil and gas. Occidental only occasionally hedges its oil and gas production and, when it does, the volumes are usually insignificant. Additionally, Occidental’s Phibro trading unit engages in trading activities using derivatives for the purpose of generating profits mainly from market price changes of commodities.

Refer to Note 1 for Occidental’s accounting policy on derivatives.

Cash-Flow Hedges

Occidental entered into financial swap agreements in November 2012 for the sale of a portion of its natural gas production in California. These swap agreements hedge 50 million cubic feet of natural gas per day beginning in January 2013 through March 2014 and qualify as cash-flow hedges. The weighted-average strike price of these swaps was $4.30.

Through March 31, 2012, Occidental held financial swap agreements related to the sale of 50 million cubic feet per day of its existing natural gas production from the Rocky Mountain region of the United States that qualified as cash-flow hedges at a weighted-average strike price of $6.07.

Through December 31, 2011, Occidental held a series of collar agreements for 12,000 barrels of oil per day of its domestic production that qualified as cash-flow hedges at a weighted-average strike price that ranged from $32.92 to $46.35.

Occidental’s marketing and trading operations store natural gas purchased from third parties at Occidental’s North American leased storage facilities. Derivative instruments are used to fix margins on the future sales of the stored volumes through March 31, 2013. As of December 31, 2012 and 2011, Occidental had approximately 20 billion cubic feet and 25 billion cubic feet of natural gas held in storage, respectively. As of December 31, 2012 and 2011, Occidental had cash-flow hedges for the forecast sale, to be settled by physical delivery, of approximately 20 billion cubic feet and 35 billion cubic feet of this stored natural gas, respectively.

The following table presents the pre-tax and after-tax gains and losses recognized in, and reclassified to income from, AOCI, for derivative instruments classified as cash-flow hedges for the years ended December 31, 2012 and 2011 (in millions):

	After-tax						Pre-Tax
	2012			2011			2012			2011
Beginning Balance - AOCI	$	1		$	(111	)
Unrealized gains recognized in AOCI	16			14			$	25		$	20
(Gains) losses reclassified to income	(24		)	98			$	(38	)	$	154
Ending Balance - AOCI	$	(7	)	$	1

Occidental expects that during the next twelve months an insignificant amount of net after-tax derivative losses included in AOCI based on their valuation as of December 31, 2012, will be reclassified into income. The gains and losses reclassified to income were recognized in net sales, and the amount of the ineffective portion of cash-flow hedges was immaterial for the years ended December 31, 2012 and 2011.

Derivatives Not Designated as Hedging Instruments

The following table summarizes Occidental’s net volumes resulting from outstanding commodity derivatives contracts not designated as hedging instruments, including both financial and physical derivative contracts as of December 31, 2012 and 2011:

	Net Outstanding Position Long / (Short)
Commodity	2012		2011
Oil (million barrels)	(17	)	(9	)
Natural gas (billion cubic feet)	(217	)	(242	)
Precious metals (million troy ounces)	1		3

In addition, Occidental typically has certain other commodity trading contracts, such as agricultural products, power and other metals, as well as foreign exchange contracts. These contracts were not material to Occidental as of December 31, 2012 and 2011.

Occidental fulfills its short positions through its own production or by third-party purchase contracts. Subsequent to December 31, 2012, Occidental entered into purchase contracts for a substantial portion of the outstanding positions at year-end and has sufficient production capacity and the ability to enter into additional purchase contracts to satisfy the remaining positions.

Approximately $49 million and $94 million of net gains from derivatives not designated as hedging instruments were recognized in net sales for the years ended December 31, 2012 and 2011, respectively.

Fair Value of Derivatives

The following table presents the gross fair value of Occidental’s outstanding derivatives as of December 31, 2012 and 2011 (in millions):

December 31, 2012	Asset Derivatives Balance Sheet Location	Fair Value			Liability Derivatives Balance Sheet Location	Fair Value
Cash-flow hedges (a)
	Other current assets	$	11		Accrued liabilities	$	1
Commodity contracts	Long-term receivables and other assets, net	—			Deferred credits and other liabilities	1
		$	11			$	2
Derivatives not designated as hedging instruments (a)
	Other current assets	$	386		Accrued liabilities	$	479
Commodity contracts	Long-term receivables and other assets, net	22			Deferred credits and other liabilities	16
		408				495
Total gross fair value		419				497
Less: counterparty netting and cash collateral (b)		(301		)		(371		)
Total net fair value of derivatives		$	118			$	126

December 31, 2011	Asset Derivatives Balance Sheet Location	Fair Value			Liability Derivatives Balance Sheet Location	Fair Value
Cash-flow hedges (a)
	Other current assets	$	41		Accrued liabilities	$	5
Commodity contracts	Long-term receivables and other assets, net	3			Deferred credits and other liabilities	—
		$	44			$	5
Derivatives not designated as hedging instruments (a)
	Other current assets	$	835		Accrued liabilities	$	887
Commodity contracts	Long-term receivables and other assets, net	71			Deferred credits and other liabilities	71
		906				958
Total gross fair value		950				963
Less: counterparty netting and cash collateral (c)		(758		)		(782		)
Total net fair value of derivatives		$	192			$	181

(a) Fair values are presented at gross amounts, including when the derivatives are subject to master netting arrangements and qualify for net presentation in the consolidated balance sheet.

(b) As of December 31, 2012, collateral received of $25 million has been netted against derivative assets and collateral paid of $95 million has been netted against derivative liabilities.

(c) As of December 31, 2011, collateral received of $42 million has been netted against derivative assets and collateral paid of $66 million has been netted against derivative liabilities.

See Note 15 for fair value measurement disclosures on derivatives.

Credit Risk

A substantial portion of Occidental’s derivative transaction volume is executed through exchange-traded contracts, which are subject to nominal credit risk as a significant portion of these transactions is settled on a daily margin basis with select clearinghouses and brokers. Collateral of $116 million and $173 million deposited by Occidental for such contracts, which has not been reflected in the derivative fair value tables, is included in the other current assets balance as of December 31, 2012 and 2011, respectively.

Occidental executes the rest of its derivative transactions in the OTC market. Occidental is subject to counterparty credit risk to the extent the counterparty to the derivatives is unable to meet its settlement commitments. Occidental manages this credit risk by selecting counterparties that it believes to be financially strong, by spreading the credit risk among many such counterparties, by entering into master netting arrangements with the counterparties and by requiring collateral, as appropriate. Occidental actively monitors the creditworthiness of each counterparty and records valuation adjustments to reflect counterparty risk, if necessary.

Certain of Occidental’s OTC derivative instruments contain credit-risk-contingent features, primarily tied to credit ratings for Occidental or its counterparties, which may affect the amount of collateral that each would need to post. As of December 31, 2012 and 2011, Occidental had a net liability of $34 million and $58 million, respectively, which are net of collateral posted of $64 million and $27 million, respectively. Occidental believes that if it had received a one-notch reduction in its credit ratings, it would not have resulted in a material change in its collateral-posting requirements as of December 31, 2012 and 2011.

Foreign Currency Risk

Occidental’s foreign operations have limited currency risk. Occidental manages its exposure primarily by balancing monetary assets and liabilities and limiting cash positions in foreign currencies to levels necessary for operating purposes. A vast majority of international oil sales are denominated in United States dollars. Additionally, all of Occidental’s consolidated foreign oil and gas subsidiaries have the United States dollar as the functional currency.

The entire disclosure for the entity's entire derivative instruments and hedging activities. Describes an entity's risk management strategies, derivatives in hedging activities and non-hedging derivative instruments, the assets, obligations, liabilities, revenues and expenses arising therefrom, and the amounts of and methodologies and assumptions used in determining the amounts of such items.

Reference 1: http://www.xbrl.org/2003/role/presentationRef
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-Name Statement of Financial Accounting Standard (FAS)
-Number 133
-Paragraph 45
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

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ENVIRONMENTAL LIABILITIES AND EXPENDITURES

ENVIRONMENTAL LIABILITIES AND EXPENDITURES

12 Months Ended

Dec. 31, 2012

ENVIRONMENTAL LIABILITIES AND EXPENDITURES

NOTE 8

ENVIRONMENTAL LIABILITIES AND EXPENDITURES

Occidental’s operations are subject to stringent federal, state, local and foreign laws and regulations related to improving or maintaining environmental quality.

ENVIRONMENTAL REMEDIATION

The laws that require or address environmental remediation, including CERCLA and similar federal, state, local and foreign laws, may apply retroactively and regardless of fault, the legality of the original activities or the current ownership or control of sites. OPC or certain of its subsidiaries participate in or actively monitor a range of remedial activities and government or private proceedings under these laws with respect to alleged past practices at operating, closed and third-party sites. Remedial activities may include one or more of the following: investigation involving sampling, modeling, risk assessment or monitoring; cleanup measures including removal, treatment or disposal; or operation and maintenance of remedial systems. The environmental proceedings seek funding or performance of remediation and, in some cases, compensation for alleged property damage, punitive damages, civil penalties, injunctive relief and government oversight costs.

As of December 31, 2012, Occidental participated in or monitored remedial activities or proceedings at 161 sites. The following table presents Occidental’s environmental remediation reserves as of December 31, 2012, 2011 and 2010, the current portion of which is included in accrued liabilities ($80 million in 2012, $79 million in 2011 and $79 million in 2010) and the remainder in deferred credits and other liabilities — other ($264 million in 2012, $281 million in 2011 and $287 million in 2010). The reserves are grouped as environmental remediation sites listed or proposed for listing by the U.S. Environmental Protection Agency on the CERCLA National Priorities List (NPL sites) and three categories of non-NPL sites — third-party sites, Occidental-operated sites and closed or non-operated Occidental sites.

$ amounts in millions	2012			2011			2010
	Number of Sites	Reserve Balance		Number of Sites	Reserve Balance		Number of Sites	Reserve Balance
NPL sites	35	$	54	36	$	63	38	$	56
Third-party sites	75	84		73	88		83	91
Occidental-operated sites	22	123		22	120		20	122
Closed or non-operated Occidental sites	29	83		29	89		29	97
Total	161	$	344	160	$	360	170	$	366

As of December 31, 2012, Occidental’s environmental reserves exceeded $10 million each at 12 of the 161 sites described above, and 112 of the sites had reserves from $0 to $1 million each.

As of December 31, 2012, two landfills in western New York owned by Occidental accounted for 73 percent of its reserves associated with NPL sites. In connection with a 1986 acquisition, Maxus Energy Corporation has retained the liability and indemnified Occidental for 14 of the remaining NPL sites.

As of December 31, 2012, Maxus has also retained the liability and indemnified Occidental for 8 of the 75 third-party sites. Two of the remaining 67 third-party sites — a former copper mining and smelting operation in Tennessee and a containment and removal project in Tennessee — accounted for 43 percent of Occidental’s reserves associated with these sites.

Five sites — chemical plants in Kansas, Louisiana, Texas and New York and a group of oil and gas properties in the southwestern United States — accounted for 70 percent of the reserves associated with the Occidental-operated sites.

Three other sites — former chemical plants in Tennessee and Delaware and a closed coal mine in Pennsylvania — accounted for 55 percent of the reserves associated with closed or non-operated Occidental sites.

Environmental reserves vary over time depending on factors such as acquisitions or dispositions, identification of additional sites and remedy selection and implementation. The following table presents environmental reserve activity for the past three years:

In millions	2012			2011			2010
Balance — Beginning of Year	$	360		$	366		$	403
Remediation expenses and interest accretion	56			53			26
Changes from acquisitions/dispositions	—			14			3
Payments	(72		)	(73		)	(66		)
Balance — End of Year	$	344		$	360		$	366

Based on current estimates, Occidental expects to expend funds corresponding to approximately half of the current environmental reserves at the sites described above over the next four years and the balance at these sites over the subsequent 10 or more years. Occidental believes its range of reasonably possible additional losses beyond those liabilities recorded for environmental remediation at these sites could be up to $375 million.

ENVIRONMENTAL COSTS

Occidental’s environmental costs, some of which include estimates, are presented below for each segment for each of the years ended December 31:

In millions	2012		2011		2010
Operating Expenses
Oil and Gas	$	160	$	158	$	108
Chemical	70		68		72
Midstream and Marketing	20		21		13
	$	250	$	247	$	193
Capital Expenditures
Oil and Gas	$	122	$	110	$	72
Chemical	18		15		19
Midstream and Marketing	12		15		13
	$	152	$	140	$	104
Remediation Expenses
Corporate	$	56	$	52	$	25

Operating expenses are incurred on a continual basis. Capital expenditures relate to longer-lived improvements in currently operating properties. Remediation expenses relate to existing conditions from past operations.

The entire disclosure for environmental loss contingencies, such as presence of hazardous waste, relevant information from reports issued by regulators, and estimated costs to achieve compliance with regulatory requirements. This element may be used for all of an entity's disclosures about environmental loss contingencies.

LAWSUITS, CLAIMS, COMMITMENTS AND CONTINGENCIES

LAWSUITS, CLAIMS, COMMITMENTS AND CONTINGENCIES

12 Months Ended

Dec. 31, 2012

LAWSUITS, CLAIMS, COMMITMENTS AND CONTINGENCIES

NOTE 9

LAWSUITS, CLAIMS, COMMITMENTS AND CONTINGENCIES

OPC or certain of its subsidiaries are involved, in the normal course of business, in lawsuits, claims and other legal proceedings that seek, among other things, compensation for alleged personal injury, breach of contract, property damage or other losses, punitive damages, civil penalties, or injunctive or declaratory relief. OPC or certain of its subsidiaries also are involved in proceedings under CERCLA and similar federal, state, local and foreign environmental laws. These environmental proceedings seek funding or performance of remediation and, in some cases, compensation for alleged property damage, punitive damages, civil penalties and injunctive relief. Usually OPC or such subsidiaries are among many companies in these environmental proceedings and have to date been successful in sharing response costs with other financially sound companies. Further, some lawsuits, claims and legal proceedings involve acquired assets with respect to which third-parties retain liability or indemnify Occidental for conditions that existed prior to purchase.

Occidental accrues reserves for currently outstanding lawsuits, claims and proceedings when it is probable that a liability has been incurred and the liability can be reasonably estimated. Occidental has disclosed its reserve balances for environmental matters. Reserve balances for other matters as of December 31, 2012 and 2011, were not material to Occidental’s consolidated balance sheets. Occidental also evaluates the amount of reasonably possible losses that it could incur as a result of the matters mentioned above. Occidental has disclosed its range of reasonably possible additional losses for sites where it is a participant in environmental remediation. Occidental believes that other reasonably possible losses that it could incur in excess of reserves accrued on the balance sheet would not be material to its consolidated financial position or results of operations.

During the course of its operations, Occidental is subject to audit by tax authorities for varying periods in various federal, state, local and foreign tax jurisdictions. Although taxable years through 2009 for United States federal income tax purposes have been audited by the United States Internal Revenue Service (IRS) pursuant to its Compliance Assurance Program, subsequent taxable years are currently under review. Additionally, in December 2012, Occidental filed United States federal refund claims for tax years 2008 and 2009 which are subject to IRS review. Taxable years from 2000 through the current year remain subject to examination by foreign and state government tax authorities in certain jurisdictions. In certain of these jurisdictions, tax authorities are in various stages of auditing Occidental’s income taxes. During the course of tax audits, disputes have arisen and other disputes may arise as to facts and matters of law. Occidental believes that the resolution of outstanding tax matters would not have a material adverse effect on its consolidated financial position or results of operations.

OPC, its subsidiaries or both have entered into agreements providing for future payments to secure terminal and pipeline capacity, drilling rigs and services, electrical power, steam and certain chemical raw materials. Occidental has certain other commitments under contracts, guarantees and joint ventures, including purchase commitments for goods and services at market-related prices and certain other contingent liabilities. At December 31, 2012, total purchase obligations were $8.7 billion, which included approximately $2.7 billion, $1.4 billion, $700 million, $500 million and $400 million that will be paid in 2013, 2014, 2015, 2016 and 2017, respectively. Included in the purchase obligations are commitments for major fixed and determinable capital expenditures during 2013 and thereafter, which were approximately $2.2 billion.

OPC, its subsidiaries or both have indemnified various parties against specified liabilities those parties might incur in the future in connection with purchases and other transactions that they have entered into with Occidental. These indemnities usually are contingent upon the other party incurring liabilities that reach specified thresholds. As of December 31, 2012, Occidental is not aware of circumstances that it believes would reasonably be expected to lead to indemnity claims that would result in payments materially in excess of reserves.

The entire disclosure for commitments and contingencies.

Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Reference 3: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
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-URI http://asc.fasb.org/extlink&oid=6952336&loc=d3e14435-108349

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DOMESTIC AND FOREIGN INCOME TAXES

DOMESTIC AND FOREIGN INCOME TAXES

12 Months Ended

Dec. 31, 2012

DOMESTIC AND FOREIGN INCOME TAXES

NOTE 10

DOMESTIC AND FOREIGN INCOME TAXES

The domestic and foreign components of income from continuing operations before domestic and foreign income taxes and net of noncontrolling interest amounts were as follows:

For the years ended December 31, (in millions)	Domestic			Foreign		Total
2012	$	2,117	(a)	$	5,636	$	7,753
2011	$	4,806		$	6,035	$	10,841
2010	$	3,295		$	4,269	$	7,564

(a) Includes pre-tax charges of $1.8 billion for the impairment of domestic gas assets and related items.

The provisions (credits) for domestic and foreign income taxes on continuing operations consisted of the following:

For the years ended December 31, (in millions)	United States Federal			State and Local		Foreign		Total
2012
Current	$	(401	)	$	8	$	2,383	$	1,990
Deferred	1,046			41		41		1,128
	$	645		$	49	$	2,424	$	3,118
2011
Current	$	320		$	88	$	2,357	$	2,765
Deferred	1,340			47		49		1,436
	$	1,660		$	135	$	2,406	$	4,201
2010
Current	$	614		$	79	$	1,896	$	2,589
Deferred	390			4		12		406
	$	1,004		$	83	$	1,908	$	2,995

The following reconciliation of the United States federal statutory income tax rate to Occidental’s worldwide effective tax rate on income from continuing operations is stated as a percentage of pre-tax income:

For the years ended December 31,	2012		2011		2010
United States federal statutory tax rate	35	%	35	%	35	%
Operations outside the United States	5		4		5
State income taxes, net of federal benefit	1		1		1
Other	(1	)	(1	)	(1	)
Worldwide effective tax rate	40	%	39	%	40	%

The tax effects of temporary differences resulting in deferred income taxes at December 31, 2012 and 2011 were as follows:

	2012					2011
Tax effects of temporary differences (in millions)	Deferred Tax Assets			Deferred Tax Liabilities		Deferred Tax Assets			Deferred Tax Liabilities
Property, plant and equipment differences	$	—		$	7,316	$	—		$	6,039
Equity investments, partnerships and foreign subsidiaries	—			351		—			351
Environmental reserves	126			—		131			—
Postretirement benefit accruals	413			—		410			—
Deferred compensation and benefits	278			—		286			—
Asset retirement obligations	367			—		318			—
Foreign tax credit carryforwards	1,277			—		1,240			—
Other tax credit carryforwards	195			—		—			—
Federal benefit of state income taxes	89			—		104			—
All other	334			161		374			116
Subtotal	3,079			7,828		2,863			6,506
Valuation allowance	(1,040		)	—		(1,003		)	—
Total deferred taxes	$	2,039		$	7,828	$	1,860		$	6,506

Included in total deferred tax assets was a current portion aggregating $250 million and $200 million as of December 31, 2012 and 2011, respectively, that was reported in other current assets. Total deferred tax assets were $2.0 billion and $1.9 billion as of December 31, 2012 and 2011, respectively, the noncurrent portion of which is netted against deferred tax liabilities. Occidental expects to realize the recorded deferred tax assets, net of any allowances, through future operating income and reversal of temporary differences.

Occidental had, as of December 31, 2012, foreign tax credit carryforwards of $1.3 billion, which expire in varying amounts through 2022, and various state operating loss carryforwards, which have varying carryforward periods through 2025. Substantially all of Occidental’s valuation allowance is provided for foreign tax credit and state operating loss carryforwards.

A deferred tax liability has not been recognized for temporary differences related to unremitted earnings of certain consolidated foreign subsidiaries aggregating approximately $8.1 billion at December 31, 2012, as it is Occidental’s intention, generally, to reinvest such earnings permanently. If the earnings of these foreign subsidiaries were not indefinitely reinvested, an additional deferred tax liability of approximately $116 million would be required, assuming utilization of available foreign tax credits.

Discontinued operations include income tax charges of $7 million and $86 million in 2012 and 2011, respectively, and income tax benefits of $26 million in 2010.

Additional paid-in capital was credited $8 million in 2012, $14 million in 2011 and $22 million in 2010 for an excess tax benefit from the exercise of certain stock-based compensation awards.

As of December 31, 2012, Occidental had liabilities for unrecognized tax benefits of approximately $76 million included in deferred credits and other liabilities — other, all of which, if subsequently recognized, would favorably affect Occidental’s effective tax rate.

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:

For the years ended December 31, (in millions)	2012			2011
Balance at January 1,	$	67		$	38
Additions based on tax positions related to the current year	16			44
Reductions based on tax positions related to prior years and settlements	(7		)	(15		)
Balance at December 31,	$	76		$	67

Occidental records estimated potential interest and penalties related to liabilities for unrecognized tax benefits in the provisions for domestic and foreign income taxes and these amounts were not material for the years ended December 31, 2012, 2011 and 2010.

Occidental is subject to audit by various tax authorities in varying periods. See Note 9 for a discussion of these matters.

Management believes it is unlikely that Occidental’s liabilities for unrecognized tax benefits related to existing matters would increase or decrease within the next twelve months by a material amount. Occidental cannot reasonably estimate a range of potential changes in such benefits due to the unresolved nature of the various audits.

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 08
-Paragraph h
-Article 4

Reference 2: http://www.xbrl.org/2003/role/presentationRef
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-Name Statement of Financial Accounting Standard (FAS)
-Number 109
-Paragraph 136, 172
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STOCKHOLDERS' EQUITY

12 Months Ended

Dec. 31, 2012

STOCKHOLDERS' EQUITY

STOCKHOLDERS' EQUITY

NOTE 11

STOCKHOLDERS’ EQUITY

The following is a summary of common stock issuances:

Shares in thousands		Common Stock
Balance, December 31, 2009		883,643
Issued		967
Options exercised and other, net		665
Balance, December 31, 2010		885,275
Issued		1,302
Options exercised and other, net		232
Balance, December 31, 2011		886,809
Issued		1,746
Options exercised and other, net		246
Balance, December 31, 2012		888,801

TREASURY STOCK

Occidental has had a 95 million share repurchase program authorized since 2008; however, the program does not obligate Occidental to acquire any specific number of shares and may be discontinued at any time. In 2012 and 2011, respectively, Occidental purchased 7.2 million and 2.7 million shares under the program at an average cost of $77.98 and $77.12 per share.

Additionally, Occidental purchased shares from the trustee of its defined contribution savings plan during the years ended December 31, 2012, 2011 and 2010.

As of December 31, 2012, 2011 and 2010, treasury stock shares numbered 83.3 million, 75.8 million and 72.5 million, respectively.

NONREDEEMABLE PREFERRED STOCK

Occidental has authorized 50,000,000 shares of preferred stock with a par value of $1.00 per share. At December 31, 2012, 2011 and 2010, Occidental had no outstanding shares of preferred stock.

EARNINGS PER SHARE

The following table presents the calculation of basic and diluted EPS for the years ended December 31:

In millions, except per-share amounts	2012			2011			2010
Basic EPS
Income from continuing operations	$	4,635	(a)	$	6,640		$	4,641
Less: Income from continuing operations attributable to noncontrolling interest	—			—			(72		)
Income from continuing operations attributable to common stock	4,635			6,640			4,569
Discontinued operations, net	(37		)	131			(39		)
Net income attributable to common stock	4,598			6,771			4,530
Less: Net income allocated to participating securities	(8		)	(11		)	(6		)
Net income attributable to common stock, net of participating securities	$	4,590		$	6,760		$	4,524
Weighted average number of basic shares	809.3			812.1			812.5
Basic EPS	$	5.67		$	8.32		$	5.57

Diluted EPS
Net income attributable to common stock, net of participating securities	$	4,590		$	6,760		$	4,524
Weighted average number of basic shares	809.3			812.1			812.5
Dilutive effect of potentially dilutive securities	0.7			0.8			1.3
Total diluted weighted average common shares	810.0			812.9			813.8
Diluted EPS	$	5.67		$	8.32		$	5.56

(a) Includes after-tax charges of $1.1 billion for the impairment of domestic gas assets and related items.

ACCUMULATED OTHER COMPREHENSIVE LOSS

Accumulated other comprehensive loss consisted of the following after-tax gains (losses):

Balance at December 31, (in millions)	2012			2011
Foreign currency translation adjustments	$	(34	)	$	(9	)
Unrealized gains (losses) on derivatives	(7		)	1
Pension and post-retirement adjustments (a)	(461		)	(475		)
Total	$	(502	)	$	(483	)

(a) See Note 13 for further information.

The entire disclosure for shareholders' equity, comprised of portions attributable to the parent entity and noncontrolling interest, if any, including other comprehensive income (as applicable). Including, but not limited to: (1) balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings; (2) accumulated balance for each classification of other comprehensive income and total amount of comprehensive income; (3) amount and nature of changes in separate accounts, including the number of shares authorized and outstanding, number of shares issued upon exercise and conversion, and for other comprehensive income, the adjustments for reclassifications to net income; (4) rights and privileges of each class of stock authorized; (5) basis of treasury stock, if other than cost, and amounts paid and accounting treatment for treasury stock purchased significantly in excess of market; (6) dividends paid or payable per share and in the aggregate for each class of stock for each period presented; (7) dividend restrictions and accumulated preferred dividends in arrears (in aggregate and per share amount); (8) retained earnings appropriations or restrictions, such as dividend restrictions; (9) impact of change in accounting principle, initial adoption of new accounting principle and correction of an error in previously issued financial statements; (10) shares held in trust for Employee Stock Ownership Plan (ESOP); (11) deferred compensation related to issuance of capital stock; (12) note received for issuance of stock; (13) unamortized discount on shares; (14) description, terms, and number of warrants or rights outstanding; (15) shares under subscription and subscription receivables, effective date of new retained earnings after quasi-reorganization and deficit eliminated by quasi-reorganization and, for a period of at least ten years after the effective date, the point in time from which the new retained dates; and (16) retroactive effective of subsequent change in capital structure.

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Reference 6: http://www.xbrl.org/2003/role/presentationRef
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Reference 8: http://www.xbrl.org/2003/role/presentationRef
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STOCK-BASED INCENTIVE PLANS

STOCK-BASED INCENTIVE PLANS

12 Months Ended

Dec. 31, 2012

STOCK-BASED INCENTIVE PLANS

NOTE 12

STOCK-BASED INCENTIVE PLANS

Occidental has established several Plans that allow it to issue stock-based awards in the form of RSUs, stock options (Options), stock appreciation rights (SARs) and TSRIs. An aggregate of 66 million shares of Occidental common stock were authorized for issuance and approximately 15 million shares had been issued through December 31, 2012. Of the remaining shares, approximately 19 million shares are available for grants of future awards because a plan provision requires each share covered by an award (other than Options and SARs) to be counted as if three shares were issued in determining the number of shares that otherwise would have been available for future awards. Further, the number of shares available for future awards may be less than 19 million depending on the type of award granted. Additionally, under the plan, the shares available for future awards may increase by the number of shares currently unvested or forfeitable, or three times that number as applicable, that (i) fail to vest, (ii) are forfeited or cancelled, or (iii) correspond to the portion of any stock-based awards settled in cash.

During 2012, non-employee directors were granted awards for 53,800 shares of restricted stock that fully vested on the grant date. Compensation expense for these awards was measured using the quoted market price of Occidental’s common stock on the grant date and was fully recognized at that time.

The following table summarizes certain stock-based incentive amounts for the past three years:

For the years ended December 31, (in millions)	2012		2011		2010
Compensation expense	$	78	$	110	$	136
Income tax benefit recognized in the income statement	$	29	$	40	$	50
Intrinsic value of options and stock-settled SARs exercised	$	18	$	21	$	74
Cash paid (a)	$	83	$	124	$	97
Fair value of RSUs and TSRIs vested during the year (b)	$	28	$	53	$	19

(a) Includes cash paid under the cash-settled portion of the SARs, RSUs and TSRIs.

(b) As measured on the vesting date for the stock-settled portion of the RSUs and TSRIs.

As of December 31, 2012, unrecognized compensation expense for all unvested stock-based incentive awards, based on year-end valuation, was $196 million. This expense is expected to be recognized over a weighted-average period of 2.1 years.

RSUs

Certain employees are awarded the right to receive RSUs, some of which have performance criteria, and are, or are equivalent in value to, actual shares of Occidental common stock and are settled in cash or stock at the time of vesting. These awards vest at the end of, or ratably over, two or three years from the grant date, however, certain of the RSUs are forfeitable if performance objectives are not satisfied between the third and seventh anniversaries after the grant date. For those awards that cliff vest in two years, dividend equivalents are accumulated during the vesting period and are paid when they vest. For the remaining RSUs, dividend equivalents are paid during the vesting period. The weighted-average, grant-date fair values of cash-settled RSUs granted in 2012, 2011 and 2010 were $84.38, $104.74 and $77.14 per share, respectively. The weighted-average, grant-date fair values of the stock-settled RSUs granted in 2012, 2011, and 2010 were $84.81, $102.97 and $84.29 respectively.

A summary of changes in Occidental’s unvested cash- and stock-settled RSUs during the year ended December 31, 2012 is presented below:

	Cash-Settled				Stock-Settled
	RSUs (000’s)		Weighted-Average Grant-Date Fair Value		RSUs (000’s)		Weighted-Average Grant-Date Fair Value
Unvested at January 1	1,272		$	90.50	568		$	93.14
Granted	729		$	84.38	824		$	84.81
Vested	(621	)	$	83.61	(9	)	$	88.21
Forfeitures	(48	)	$	92.90	(8	)	$	84.57
Unvested at December 31	1,332		$	90.27	1,375		$	88.23

STOCK OPTIONS AND SARs

Certain employees have been granted Options that are settled in stock and SARs that are settled either only in stock or only in cash. No Options or SARs have been granted since 2006 and all outstanding awards are vested. Exercise prices of the Options and SARs were equal to the quoted market value of Occidental’s stock on the grant date. Generally, the Options and SARs vest ratably over three years from the grant date with a maximum term of ten years. These Options and SARs may be forfeited or accelerated under certain circumstances.

The fair value of each Option, stock-settled SAR or cash-settled SAR is initially measured on the grant date using the Black Scholes option valuation model. The expected life is estimated based on the actual weighted-average life of historical exercise activity of the grantee population at the grant date. The volatility factors are based on the historical volatilities of Occidental common stock over the expected lives as estimated on the grant date. The risk-free interest rate is the implied yield available on zero coupon T-notes (US Treasury Strip) at the grant date with a remaining term equal to the expected life of the measured instrument. The dividend yield is the expected annual dividend yield over the expected life, expressed as a percentage of the stock price on the grant date. Estimates of fair value may not accurately predict the value ultimately realized by employees who receive stock-based incentive awards, and the ultimate value may not be indicative of the reasonableness of the original estimates of fair value made by Occidental.

The following is a summary of Option and SAR transactions during the year ended December 31, 2012:

Cash-Settled

Stock-Settled

SARs
(000’s)

Weighted-
Average
Exercise
Price

Weighted-
Average
Remaining
Contractual
Term (yrs)

Aggregate
Intrinsic
Value
(000’s)

SARs &
Options
(000’s)

Weighted-
Average
Exercise
Price

Weighted-
Average
Remaining
Contractual
Term (yrs)

Aggregate
Intrinsic
Value
(000’s)

Beginning balance, January 1

564

24.66

782

26.34

Exercised

(70

)

24.66

(245

)

14.22

Ending balance, December 31

494

24.66

1.5

25,639

537

31.88

2.0

24,008

Exercisable at December 31

494

24.66

1.5

25,639

537

31.88

2.0

24,008

TSRIs

Certain executives are awarded TSRIs that vest at the end of the three- or four-year period following the grant date if performance targets are certified as being met. TSRIs granted in July 2012 have payouts that range from 0 to 100 percent of the maximum award that would settle, once certified, fully in stock. TSRIs granted in July 2011 and October 2010 have payouts that range from 0 to 100 percent of the maximum award that would settle, once certified, 50 percent in stock and 50 percent in cash. TSRIs granted in July 2009 have payouts that ranged from 0 to 200 percent of the target award that would settle, once certified, 60 percent in stock and 40 percent in cash. TSRIs granted in July 2008 had payouts of 150 percent of the target award and were certified and settled equally in stock and cash in 2012. Dividend equivalents for TSRI target shares are paid during the performance period regardless of the payout range or settlement provision, except for the TSRIs issued in 2010, 2011 and 2012, for which cumulative dividends will be paid upon vesting for the number of vested shares.

The fair values of TSRIs are initially determined on the grant date using a Monte Carlo simulation model based on Occidental’s assumptions, noted in the following table, and the volatility from corresponding peer group companies. The expected life is based on the vesting period (Term). The risk-free interest rate is the implied yield available on zero coupon T-notes (US Treasury Strip) at the time of grant with a remaining term equal to the Term. The dividend yield is the expected annual dividend yield over the Term, expressed as a percentage of the stock price on the grant date. Estimates of fair value may not accurately predict the value ultimately realized by the employees who receive the awards, and the ultimate value may not be indicative of the reasonableness of the original estimates of fair value made by Occidental.

The grant-date assumptions used in the Monte Carlo simulation models for the estimated payout level of TSRIs were as follows:

	TSRIs
Year Granted	2012			2011			2010
Assumptions used:
Risk-free interest rate	0.4		%	0.6		%	0.6		%
Dividend yield	2.6		%	1.8		%	1.8		%
Volatility factor	34		%	33		%	32		%
Expected life (years)	3			3			3
Grant-date fair value of underlying Occidental common stock	$	84.57		$	102.97		$	84.29

A summary of Occidental’s unvested TSRIs as of December 31, 2012 and changes during the year ended December 31, 2012 is presented below:

	TSRIs
	Awards (000’s)		Weighted-Average Grant-Date Fair Value of Occidental Stock
Unvested at January 1 (a)	1,865		$	78.67
Granted (a)	453		$	84.57
Vested (b)	(388	)	$	77.00
Forfeitures	—		$	—
Unvested at December 31 (a)	1,930		$	80.39

(a) Unvested awards and award grants are presented at the target or mid-point payouts.

(b) The payout at vesting was 150 percent of the target for TSRIs.

The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details.

Reference 1: http://www.xbrl.org/2003/role/presentationRef
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-Number 123R
-Paragraph 64, 65, A240
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-Number 93-6
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-Name Staff Accounting Bulletin (SAB)
-Number Topic 14

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-Publisher FASB
-Name Accounting Standards Codification
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-Section 50
-Paragraph 1
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RETIREMENT AND POSTRETIREMENT BENEFIT PLANS

RETIREMENT AND POSTRETIREMENT BENEFIT PLANS

12 Months Ended

Dec. 31, 2012

RETIREMENT AND POSTRETIREMENT BENEFIT PLANS

NOTE 13

RETIREMENT AND POSTRETIREMENT BENEFIT PLANS

Occidental has various benefit plans for its salaried, domestic union and nonunion hourly, and certain foreign national employees.

DEFINED CONTRIBUTION PLANS

All domestic employees and certain foreign national employees are eligible to participate in one or more of the defined contribution retirement or savings plans that provide for periodic contributions by Occidental based on plan-specific criteria, such as base pay, age, level and employee contributions. Certain salaried employees participate in a supplemental retirement plan that restores benefits lost due to governmental limitations on qualified retirement benefits. The accrued liabilities for the supplemental retirement plan were $145 million and $126 million as of December 31, 2012 and 2011, respectively, and Occidental expensed $137 million in 2012, $110 million in 2011 and $101 million in 2010 under the provisions of these defined contribution and supplemental retirement plans.

DEFINED BENEFIT PLANS

Participation in defined benefit plans is limited and approximately 1,000 domestic and 1,600 foreign national employees, mainly union, nonunion hourly and certain employees that joined Occidental from acquired operations with grandfathered benefits, are currently accruing benefits under these plans.

Pension costs for Occidental’s defined benefit pension plans, determined by independent actuarial valuations, are generally funded by payments to trust funds, which are administered by independent trustees.

POSTRETIREMENT AND OTHER BENEFIT PLANS

Occidental provides medical and dental benefits and life insurance coverage for certain active, retired and disabled employees and their eligible dependents. Occidental generally funds the benefits as they are paid during the year. These benefit costs, including the postretirement costs, were approximately $218 million in 2012, $194 million in 2011 and $180 million in 2010.

OBLIGATIONS AND FUNDED STATUS

The following tables show the amounts recognized in the consolidated balance sheets of Occidental related to its pension and postretirement benefit plans and their funding status, obligations and plan asset fair values (in millions):

	Pension Benefits						Postretirement Benefits
As of December 31,	2012			2011			2012			2011
Amounts recognized in the consolidated balance sheet:
Other assets	$	24		$	24		$	—		$	—
Accrued liabilities	(4		)	(5		)	(59		)	(47		)
Deferred credits and other liabilities — other	(136		)	(136		)	(1,068		)	(1,045		)
	$	(116	)	$	(117	)	$	(1,127	)	$	(1,092	)
AOCI included the following after-tax balances:
Net loss	$	134		$	146		$	324		$	331
Prior service cost	1			2			2			2
	$	135		$	148		$	326		$	333

For the years ended December 31,
Changes in benefit obligation:
Benefit obligation — beginning of year	$	592		$	615		$	1,092		$	991
Service cost — benefits earned during the period	13			12			25			22
Interest cost on projected benefit obligation	27			29			42			45
Actuarial loss	46			49			26			81
Foreign currency exchange rate (gain) loss	2			(5		)	—			—
Benefits paid	(57		)	(51		)	(58		)	(47		)
Settlements	(8		)	(57		)	—			—
Benefit obligation — end of year	$	615		$	592		$	1,127		$	1,092

Changes in plan assets:
Fair value of plan assets — beginning of year	$	475		$	495		$	—		$	—
Actual return on plan assets	61			13			—			—
Foreign currency exchange rate gain (loss)	(3		)	(3		)	—			—
Employer contributions	31			78			—			—
Benefits paid	(57		)	(51		)	—			—
Settlements	(8		)	(57		)	—			—
Fair value of plan assets — end of year	$	499		$	475		$	—		$	—
Unfunded status:	$	(116	)	$	(117	)	$	(1,127	)	$	(1,092	)

The following table sets forth details of the obligations and assets of Occidental’s defined benefit pension plans (in millions):

	Accumulated Benefit Obligation in Excess of Plan Assets				Plan Assets in Excess of Accumulated Benefit Obligation
As of December 31, (in millions)	2012		2011		2012		2011
Projected Benefit Obligation	$	305	$	361	$	310	$	231
Accumulated Benefit Obligation	$	278	$	334	$	305	$	227
Fair Value of Plan Assets	$	171	$	226	$	328	$	249

Occidental does not expect any plan assets to be returned during 2013.

COMPONENTS OF NET PERIODIC BENEFIT COST

The following table sets forth the components of net periodic benefit costs (in millions):

	Pension Benefits									Postretirement Benefits
For the years ended December 31, (in millions)	2012			2011			2010			2012		2011		2010
Net periodic benefit costs:
Service cost — benefits earned during the period	$	13		$	12		$	16		$	25	$	22	$	19
Interest cost on benefit obligation	27			29			30			42		45		44
Expected return on plan assets	(31		)	(33		)	(31		)	—		—		—
Recognized actuarial loss	19			13			15			37		31		27
Other costs and adjustments	17			—			10			1		1		1
Net periodic benefit cost	$	45		$	21		$	40		$	105	$	99	$	91

The estimated net loss and prior service cost for the defined benefit pension plans that will be amortized from AOCI into net periodic benefit cost over the next fiscal year are $17 million and $0, respectively. The estimated net loss and prior service cost for the defined benefit postretirement plans that will be amortized from AOCI into net periodic benefit cost over the next fiscal year are $37 million and $1 million, respectively.

ADDITIONAL INFORMATION

The following table sets forth the weighted-average assumptions used to determine Occidental’s benefit obligation and net periodic benefit cost for domestic plans:

	Pension Benefits				Postretirement Benefits
For the years ended December 31,	2012		2011		2012		2011
Benefit Obligation Assumptions:
Discount rate	3.59	%	4.12	%	3.89	%	4.12	%
Rate of compensation increase	4.00	%	4.00	%	—		—
Net Periodic Benefit Cost Assumptions:
Discount rate	4.12	%	4.74	%	4.12	%	4.74	%
Assumed long term rate of return on assets	6.50	%	6.50	%	—		—
Rate of compensation increase	4.00	%	4.00	%	—		—

For domestic pension plans and postretirement benefit plans, Occidental based the discount rate on the Aon/Hewitt AA-AAA Universe yield curve in 2012 and 2011. The weighted-average rate of increase in future compensation levels is consistent with Occidental’s past and anticipated future compensation increases for employees participating in retirement plans that determine benefits using compensation. The assumed long-term rate of return on assets is estimated with regard to current market factors but within the context of historical returns. Occidental considers historical returns and correlation of equities and fixed-income securities and current market factors such as inflation and interest rates.

For pension plans outside the United States, Occidental based its discount rate on rates indicative of government or investment grade corporate debt in the applicable country, taking into account hyperinflationary environments when necessary. The discount rates used for the foreign pension plans ranged from 1.5 percent to 10.0 percent at both December 31, 2012 and 2011. The average rate of increase in future compensation levels ranged from 1.5 percent to 10.0 percent in 2012, depending on local economic conditions. The expected long-term rate of return on plan assets was 6.5 percent and 5.8 percent in excess of local inflation in 2012 and 2011, respectively.

The postretirement benefit obligation was determined by application of the terms of medical and dental benefits and life insurance coverage, including the effect of established maximums on covered costs, together with relevant actuarial assumptions and healthcare cost trend rates projected at an assumed U.S. Consumer Price Index (CPI) increase of 2.39 percent and 2.04 percent as of December 31, 2012 and 2011, respectively. Since 1993, participants other than certain union employees have paid for all medical cost increases in excess of increases in the CPI. For those union employees, Occidental projected that healthcare cost trend rates would decrease 0.5 percent per year from 8.5 percent in 2012 until they reach 6.0 percent in 2017, and remain at 6.0 percent thereafter. A 1-percent increase or a 1-percent decrease in these assumed healthcare cost trend rates would result in an increase of $44 million or a reduction of $37 million, respectively, in the postretirement benefit obligation as of December 31, 2012. The annual service and interest costs would not be materially affected by these changes.

The actuarial assumptions used could change in the near term as a result of changes in expected future trends and other factors that, depending on the nature of the changes, could cause increases or decreases in the plan assets and liabilities.

FAIR VALUE OF PENSION PLAN ASSETS

Occidental employs a total return investment approach that uses a diversified blend of equity and fixed-income investments to optimize the long-term return of plan assets at a prudent level of risk. The investments are monitored by Occidental’s Investment Committee in its role as fiduciary. The Investment Committee, consisting of senior Occidental executives, selects and employs various external professional investment management firms to manage specific investments across the spectrum of asset classes. Equity investments are diversified across United States and non-United States stocks, as well as differing styles and market capitalizations. Other asset classes such as private equity and real estate may be used with the goals of enhancing long-term returns and improving portfolio diversification. The target allocation of plan assets is 60 percent equity securities and 40 percent debt securities. Investment performance is measured and monitored on an ongoing basis through quarterly investment portfolio and manager guideline compliance reviews, annual liability measurements and periodic studies.

The fair values of Occidental’s pension plan assets by asset category are as follows (in millions):

	Fair Value Measurements at December 31, 2012 Using
Description	Level 1		Level 2		Level 3		Total
Asset Class:
U.S. government securities	$	24	$	—	$	—	$	24
Corporate bonds (a)	—		83		—		83
Common/collective trusts (b)	—		11		—		11
Mutual funds:
Bond funds	84		—		—		84
Blend funds	106		—		—		106
Value and growth funds	5		—		—		5
Common and preferred stocks (c)	146		—		—		146
Other	—		35		11		46
Total pension plan assets (d)	$	365	$	129	$	11	$	505

	Fair Value Measurements at December 31, 2011 Using
Description	Level 1		Level 2		Level 3		Total
Asset Class:
U.S. government securities	$	22	$	—	$	—	$	22
Corporate bonds (a)	—		83		—		83
Common/collective trusts (b)	—		14		—		14
Mutual funds:
Bond funds	84		—		—		84
Blend funds	97		—		—		97
Value and growth funds	5		—		—		5
Common and preferred stocks (c)	131		—		—		131
Other	—		34		12		46
Total pension plan assets (d)	$	339	$	131	$	12	$	482

(a) This category represents investment grade bonds of U.S. and non-U.S. issuers from diverse industries.

(b) This category includes investment funds that primarily invest in U.S. and non-U.S. common stocks and fixed-income securities.

(c) This category represents direct investments in common and preferred stocks from diverse U.S. and non-U.S. industries.

(d) Amounts exclude net payables of approximately $6 million and $7 million as of December 31, 2012 and 2011, respectively.

The activity during the years ended December 31, 2012 and 2011 for the assets using Level 3 fair value measurements was insignificant.

Occidental expects to contribute $5 million in cash to its defined benefit pension plans during 2013.

Estimated future benefit payments, which reflect expected future service, as appropriate, are as follows:

For the years ended December 31, (in millions)	Pension Benefits		Postretirement Benefits
2013	$	40	$	50
2014	$	44	$	51
2015	$	41	$	52
2016	$	46	$	53
2017	$	42	$	54
2018 — 2022	$	230	$	294

The entire disclosure for pension and other postretirement benefits.

Reference 1: http://www.xbrl.org/2003/role/presentationRef
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-Name Statement of Financial Accounting Standard (FAS)
-Number 132R
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INVESTMENTS AND RELATED-PARTY TRANSACTIONS

INVESTMENTS AND RELATED-PARTY TRANSACTIONS

12 Months Ended

Dec. 31, 2012

INVESTMENTS AND RELATED-PARTY TRANSACTIONS

NOTE 14

INVESTMENTS AND RELATED-PARTY TRANSACTIONS

As of December 31, 2012 and 2011, investments in unconsolidated entities comprised $1.9 billion and $2.1 billion of equity-method investments, respectively.

EQUITY INVESTMENTS

As of December 31, 2012, Occidental’s equity investments consisted mainly of a 35-percent interest in the general partner of Plains Pipeline, a 24.5-percent interest in the stock of Dolphin Energy, and various other partnerships and joint ventures. Equity investments paid dividends of $526 million, $349 million and $217 million to Occidental in 2012, 2011 and 2010, respectively. As of December 31, 2012, cumulative undistributed earnings of equity-method investees since their respective acquisitions were approximately $240 million. As of December 31, 2012, Occidental’s investments in equity investees exceeded the underlying equity in net assets by $1.1 billion, of which $1 billion represented goodwill and the remainder comprised intangibles amortized over their estimated useful lives.

The following table presents Occidental’s ownership interest in the summarized financial information of its equity-method investments:

For the years ended December 31, (in millions)	2012		2011		2010
Revenues	$	2,667	$	2,439	$	1,759
Costs and expenses	2,310		2,046		1,482
Net income	$	357	$	393	$	277

As of December 31, (in millions)	2012		2011
Current assets	$	2,065	$	2,230
Non-current assets	$	5,104	$	4,381
Current liabilities	$	1,774	$	1,532
Long-term debt	$	2,250	$	2,305
Other non-current liabilities	$	241	$	168
Stockholders’ equity	$	2,904	$	2,606

Occidental’s investment in Dolphin, which was acquired in 2002, consists of two separate economic interests through which Occidental owns (i) a 24.5-percent undivided interest in the operations under an agreement which is proportionately consolidated in the financial statements; and (ii) a 24.5-percent interest in the stock of Dolphin Energy, which is accounted for as an equity investment.

During 2010, Occidental had a 50-percent joint interest in EHP, which was accounted for as an equity method investment. On December 31, 2010, Occidental completed its acquisition of the remaining 50-percent interest, bringing its total ownership to 100 percent. EHP was consolidated in Occidental’s balance sheet as of December 31, 2010.

RELATED-PARTY TRANSACTIONS

Occidental from time to time purchases oil, NGLs, power, steam and chemicals from and sells oil, NGLs, gas, chemicals and power to certain of its equity investees at market-related prices. During 2012, 2011 and 2010, Occidental entered into the following related-party transactions and had the following amounts due from or to its related parties:

December 31, (in millions)	2012		2011		2010
Purchases (a)	$	8	$	10	$	153
Sales (b)	$	419	$	392	$	440
Services	$	17	$	10	$	2
Advances and amounts due from	$	25	$	32	$	135
Amounts due to	$	129	$	21	$	383

(a) In 2010, purchases from EHP accounted for 90 percent of total purchases.

(b) In 2012, 2011 and 2010, sales of Occidental-produced oil and NGLs to Plains Pipeline accounted for 80 percent, 76 percent and 50 percent of these totals, respectively. Additionally, Occidental conducts marketing and trading activities with Plains Pipeline for oil and NGLs. These transactions are reported in Occidental’s income statement on a net margin basis. The sales amounts above include the net margins on such transactions, which were negligible. In 2012 and 2011, sales to Dolphin Energy accounted for 12 percent and 16 percent, of total sales, respectively. In 2010, sales to EHP and Dolphin Energy accounted for 44 percent of total sales.

FAIR VALUE MEASUREMENTS

12 Months Ended

Dec. 31, 2012

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

NOTE 15

FAIR VALUE MEASUREMENTS

FAIR VALUES — RECURRING

The following tables provide fair value measurement information for assets and liabilities that are measured on a recurring basis as of December 31, 2012 and 2011 (in millions):

	Fair Value Measurements at December 31, 2012 Using						Netting and			Total
Description	Level 1		Level 2		Level 3		Collateral (a)			Fair Value
Assets:
Commodity derivatives	$	107	$	312	$	—	$	(301	)	$	118
Liabilities:
Commodity derivatives	$	99	$	398	$	—	$	(371	)	$	126

	Fair Value Measurements at December 31, 2011 Using						Netting and			Total
Description	Level 1		Level 2		Level 3		Collateral (a)			Fair Value
Assets:
Commodity derivatives	$	310	$	640	$	—	$	(758	)	$	192
Liabilities:
Commodity derivatives	$	311	$	652	$	—	$	(782	)	$	181

(a) Represents the impact of netting assets, liabilities and collateral when a legal right of offset exists.

FAIR VALUES — NONRECURRING

Occidental performed impairment tests with respect to its proved and unproved properties due to the negative revisions to certain of its natural gas reserves and the continued deterioration of natural gas prices. The impairment tests, including the fair value estimation, incorporate a number of assumptions involving expectations of future cash flows. These assumptions include estimates of future product prices, which Occidental bases on forward price curves and, where applicable, contractual prices, estimates of oil and gas reserves, estimates of future expected operating and development costs and appropriate discount rates.

In 2012, Occidental recorded pre-tax impairment charges of $1.7 billion, almost all of which were for certain assets in Midcontinent, over 90 percent of which were related to natural gas properties, which were acquired more than four years ago on average. These properties were impacted by persistently low natural gas prices in the United States changing management’s development plans and negative reserve revisions due to recent well performance. In 2010, Occidental recorded a pre-tax impairment charge of $275 million, predominantly of gas properties in the Rocky Mountain region. Occidental used the income approach to measure the fair value of these properties, using inputs categorized as Level 3 in the fair value hierarchy.

FINANCIAL INSTRUMENTS FAIR VALUE

The carrying amounts of cash and cash equivalents and other on-balance-sheet financial instruments, other than fixed-rate debt, approximate fair value. The cost, if any, to terminate off-balance-sheet financial instruments is not significant.

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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INDUSTRY SEGMENTS AND GEOGRAPHIC AREAS

INDUSTRY SEGMENTS AND GEOGRAPHIC AREAS

12 Months Ended

Dec. 31, 2012

INDUSTRY SEGMENTS AND GEOGRAPHIC AREAS

NOTE 16

INDUSTRY SEGMENTS AND GEOGRAPHIC AREAS

Occidental conducts its continuing operations through three segments: (1) oil and gas; (2) chemical; and (3) midstream and marketing. The oil and gas segment explores for, develops and produces oil and condensate, NGLs, and natural gas. The chemical segment mainly manufactures and markets basic chemicals and vinyls. The midstream and marketing segment gathers, processes, transports, stores, purchases and markets oil, condensate, NGLs, natural gas, CO2 and power. It also trades around its assets, including transportation and storage capacity, and trades oil, NGLs, gas and other commodities. The segment also invests in entities that conduct similar activities.

Earnings of industry segments and geographic areas exclude income taxes, interest income, interest expense, environmental remediation expenses, unallocated corporate expenses and discontinued operations, but include gains and losses from dispositions of segment and geographic area assets and income from the segments’ equity investments. Intersegment sales eliminate upon consolidation and are generally made at prices approximating those that the selling entity would be able to obtain in third-party transactions.

Identifiable assets are those assets used in the operations of the segments. Corporate assets consist of cash, certain corporate receivables and PP&E, and an investment in the Joslyn, Canada oil sands project.

Industry Segments

In millions	Oil and Gas			Chemical			Midstream and Marketing			Corporate and Eliminations			Total
YEAR ENDED DECEMBER 31, 2012
Net sales	$	18,906	(a)	$	4,580	(b)	$	1,399	(c)	$	(713	)	$	24,172
Pretax operating profit (loss)	$	7,095	(d)	$	720		$	439		$	(501)	(f,h)	$	7,753
Income taxes	—			—			—			(3,118)		(g,h)	(3,118		)
Discontinued operations, net	—			—			—			(37		)	(37		)
Net income (loss) attributable to common stock	$	7,095		$	720		$	439		$	(3,656	)	$	4,598
Investments in unconsolidated entities	$	113		$	108		$	1,662		$	11		$	1,894
Property, plant and equipment additions, net (i)	$	8,282		$	365		$	1,612		$	91		$	10,350
Depreciation, depletion and amortization	$	3,933		$	345		$	206		$	27		$	4,511
Total assets	$	44,004		$	3,854		$	12,762		$	3,590		$	64,210
YEAR ENDED DECEMBER 31, 2011
Net sales	$	18,419	(a)	$	4,815	(b)	$	1,447	(c)	$	(742	)	$	23,939
Pretax operating profit (loss)	$	10,241	(d)	$	861		$	448		$	(709)	(f,h)	$	10,841	(d)
Income taxes	—			—			—			(4,201)		(g,h)	(4,201		)
Discontinued operations, net	—			—			—			131			131
Net income (loss) attributable to common stock	$	10,241	(d)	$	861		$	448		$	(4,779	)	$	6,771
Investments in unconsolidated entities	$	128		$	121		$	1,812		$	11		$	2,072
Property, plant and equipment additions, net (i)	$	6,192		$	241		$	1,120		$	51		$	7,604
Depreciation, depletion and amortization	$	3,064		$	330		$	173		$	24		$	3,591
Total assets	$	38,967		$	3,754		$	11,962		$	5,361		$	60,044
YEAR ENDED DECEMBER 31, 2010
Net sales	$	14,276	(a)	$	4,016	(b)	$	1,471	(c)	$	(718	)	$	19,045
Pretax operating profit (loss)	$	7,151	(d,e)	$	438		$	472		$	(497)	(f,h)	$	7,564	(d,e)
Income taxes	—			—			—			(2,995)		(g,h)	(2,995		)
Discontinued operations, net	—			—			—			(39		)	(39		)
Net income (loss) attributable to common stock	$	7,151	(d,e)	$	438		$	472		$	(3,531	)	$	4,530	(e)
Investments in unconsolidated entities	$	123		$	135		$	1,770		$	11		$	2,039
Property, plant and equipment additions, net (i)	$	3,211		$	248		$	537		$	38		$	4,034
Depreciation, depletion and amortization	$	2,668		$	321		$	142		$	22		$	3,153
Total assets	$	31,855		$	3,755		$	10,445		$	6,377	(j)	$	52,432
(See footnotes on next page)

Footnotes:

(a) Oil sales represented approximately 90 percent, 87 percent and 86 percent of the oil and gas segment net sales for the years ended December 31, 2012, 2011 and 2010, respectively.

(b) Net sales for the chemical segment comprised the following products:

	Basic Chemicals		Vinyls		Other Chemicals
Year ended December 31, 2012	57	%	40	%	3	%
Year ended December 31, 2011	58	%	39	%	3	%
Year ended December 31, 2010	57	%	40	%	3	%

	Gas Processing		Power		Marketing, Trading, Transportation and other
Year ended December 31, 2012	59	%	20	%	21	%
Year ended December 31, 2011	64	%	27	%	9	%
Year ended December 31, 2010	52	%	27	%	21	%

(d) The 2012 amount includes pre-tax charges of $1.7 billion for the impairment of domestic gas assets and related items. The 2011 amount includes pre-tax charges of $35 million related to exploration write-offs in Libya and $29 million related to a Colombian net worth tax, and a pre-tax gain for the sale of an interest in a Colombian pipeline of $22 million. The 2010 amount includes a $275 million pre-tax charge for asset impairments, predominantly of gas properties in the Rocky Mountain region.

(e) Includes amounts attributable to common stock after deducting a noncontrolling interest amount of $72 million.

(f) Includes unallocated net interest expense, administration expense, environmental remediation and other pre-tax items noted in footnote (h) below.

(g) Includes all foreign and domestic income taxes from continuing operations.

(h) Includes the following significant items affecting earnings for the years ended December 31:

Benefit (Charge) (In millions)	2012			2011			2010
CORPORATE
Pre-tax operating profit (loss)
Premium on debt extinguishments	$	—		$	(163	)	$	—
Litigation reserves	(20		)	—			—
	$	(20	)	$	(163	)	$	—
Income taxes
State income tax charge	$	—		$	(33	)	$	—
Foreign tax credit carryforwards	—			—			80
Tax effect of pre-tax adjustments *	636			50			100
	$	636		$	17		$	180

* Amounts represent the tax effect of all pre-tax adjustments listed, as well as those in footnote (d).

(i) Includes capital expenditures and capitalized interest, but excludes purchases of assets, net. Also includes amounts attributable to the noncontrolling interest in a Colombian subsidiary for 2010.

(j) Includes Argentine assets, which were classified as held for sale.

GEOGRAPHIC AREAS

In millions

	Net sales (a)						Property, plant and equipment, net
For the years ended December 31,	2012		2011		2010		2012		2011		2010
United States	$	15,359	$	15,040	$	12,151	$	40,786	$	36,283	$	28,571
Foreign
Qatar	3,356		3,432		2,677		2,676		2,735		2,823
Oman	2,578		2,500		1,666		2,353		2,143		1,967
Colombia	1,027		1,054		999		1,041		854		715
Yemen	407		907		766		199		245		347
Bahrain	215		187		100		688		477		222
United Arab Emirates	—		—		—		2,104		971		1
Other Foreign	1,230		819		686		2,217		1,976		1,890
Total Foreign	8,813		8,899		6,894		11,278		9,401		7,965
Total	$	24,172	$	23,939	$	19,045	$	52,064	$	45,684	$	36,536

(a) Sales are shown by individual country based on the location of the entity making the sale.

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

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Schedule II - Valuation and Qualifying Accounts

Schedule II - Valuation and Qualifying Accounts

12 Months Ended

Dec. 31, 2012

Schedule II - Valuation and Qualifying Accounts

Schedule II — Valuation and Qualifying Accounts
In millions

Occidental Petroleum Corporation
and Subsidiaries

			Additions
	Balance at Beginning of Period		Charged to Costs and Expenses			Charged to Other Accounts		Deductions (a)			Balance at End of Period
2012
Allowance for doubtful accounts	$	16	$	—		$	—	$	—		$	16

Environmental	$	360	$	56		$	—	$	(72	)	$	344
Litigation, tax and other reserves	198		57			—		(26		)	229
	$	558	$	113		$	—	$	(98	)	$	573	(b)
2011
Allowance for doubtful accounts	$	19	$	—		$	—	$	(3	)	$	16

Environmental	$	366	$	53		$	14	$	(73	)	$	360
Litigation, tax and other reserves	193		37			—		(32		)	198
	$	559	$	90		$	14	$	(105	)	$	558	(b)
2010
Allowance for doubtful accounts	$	30	$	(9	)	$	—	$	(2	)	$	19

Environmental	$	403	$	26		$	3	$	(66	)	$	366
Litigation, tax and other reserves	226		20			6		(59		)	193
	$	629	$	46		$	9	$	(125	)	$	559	(b)

Note: The amounts presented represent continuing operations.

(a) Primarily represents payments.

(b) Of these amounts, $98 million, $100 million and $102 million in 2012, 2011 and 2010, respectively, are classified as current.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

12 Months Ended

Dec. 31, 2012

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Consolidation policy

PRINCIPLES OF CONSOLIDATION

Certain financial statements, notes and supplementary data for prior years have been reclassified to conform to the 2012 presentation.

Investments in unconsolidated entities policy

INVESTMENTS IN UNCONSOLIDATED ENTITIES

Revenue recognition policy

REVENUE RECOGNITION

Occidental records revenue net of any taxes, such as sales taxes, that are assessed by governmental authorities on Occidental’s customers.

Deferred tax asset valuation allowance policy

Cash and cash equivalents policy

CASH AND CASH EQUIVALENTS

Available-for-sale securities and trading securities policy

Investments

Inventory policy

Inventories

Materials and supplies are valued at weighted-average cost and are reviewed periodically for obsolescence. Oil, NGL and natural gas inventories are valued at the lower of cost or market.

Property, plant and equipment policy

PROPERTY, PLANT AND EQUIPMENT

Oil and Gas

The following table summarizes the activity of capitalized exploratory well costs for continuing operations for the years ended December 31:

In millions	2012			2011			2010
Balance — Beginning of Year	$	182		$	73		$	51
Additions to capitalized exploratory well costs pending the determination of proved reserves	400			334			112
Reclassifications to property, plant and equipment based on the determination of proved reserves	(407		)	(204		)	(73		)
Capitalized exploratory well costs charged to expense	(77		)	(21		)	(17		)
Balance — End of Year	$	98		$	182		$	73

Occidental expenses annual lease rentals and geological, geophysical and seismic costs as incurred.

Occidental expenses the costs of injectants used in production.

Chemical

Midstream and Marketing

Occidental’s midstream and marketing PP&E is depreciated over the estimated useful lives of the assets, using either the unit-of-production or straight-line method.

Fair value policy

FAIR VALUE MEASUREMENTS

Fair Values - Recurring

Environmental liabilities and expenditures policy

ENVIRONMENTAL LIABILITIES AND EXPENDITURES

Asset retirement obligations policy

ASSET RETIREMENT OBLIGATIONS

For the years ended December 31, (in millions)	2012			2011
Beginning balance	$	1,089		$	800
Liabilities incurred - capitalized to PP&E	86			74
Liabilities settled and paid	(58		)	(53		)
Accretion expense	61			48
Acquisitions and other - capitalized to PP&E	50			177
Revisions to estimated cash flows - capitalized to PP&E	38			43
Ending balance	$	1,266		$	1,089

Derivatives Policy

DERIVATIVE INSTRUMENTS

Stock-based compensation and pension and postretirement benefits policy

STOCK-BASED INCENTIVE PLANS

RETIREMENT AND POSTRETIREMENT BENEFIT PLANS

Occidental recognizes the overfunded or underfunded amounts of its defined benefit pension and postretirement plans in its financial statements using a December 31 measurement date.

Earnings per share policy

EARNINGS PER SHARE

Foreign currency transactions and translations policy

FOREIGN CURRENCY TRANSACTIONS

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

12 Months Ended

Dec. 31, 2012

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Summary of the activity of capitalized exploratory well costs for continuing operations

In millions	2012			2011			2010
Balance — Beginning of Year	$	182		$	73		$	51
Additions to capitalized exploratory well costs pending the determination of proved reserves	400			334			112
Reclassifications to property, plant and equipment based on the determination of proved reserves	(407		)	(204		)	(73		)
Capitalized exploratory well costs charged to expense	(77		)	(21		)	(17		)
Balance — End of Year	$	98		$	182		$	73

Summary of the activity of the asset retirement obligation

For the years ended December 31, (in millions)	2012			2011
Beginning balance	$	1,089		$	800
Liabilities incurred - capitalized to PP&E	86			74
Liabilities settled and paid	(58		)	(53		)
Accretion expense	61			48
Acquisitions and other - capitalized to PP&E	50			177
Revisions to estimated cash flows - capitalized to PP&E	38			43
Ending balance	$	1,266		$	1,089

INVENTORIES (Tables)

12 Months Ended

Dec. 31, 2012

INVENTORIES

Inventories (in millions)

Balance at December 31, (in millions)	2012			2011
Raw materials	$	70		$	69
Materials and supplies	612			443
Finished goods	763			655
	1,445			1,167
LIFO reserve	(101		)	(98		)
Total	$	1,344		$	1,069

LONG-TERM DEBT (Tables)

12 Months Ended

Dec. 31, 2012

LONG-TERM DEBT

Long-term debt

Balance at December 31, (in millions)	2012			2011
4.10% senior notes due 2021	$	1,300		$	1,300
1.75% senior notes due 2017	1,250			1,250
2.70% senior notes due 2023	1,250			—
3.125% senior notes due 2022	900			900
4.125% senior notes due 2016	750			750
2.5% senior notes due 2016	700			700
1.45% senior notes due 2013	600			600
1.50% senior notes due 2018	500			—
8.45% senior notes due 2029	116			116
9.25% senior debentures due 2019	116			116
7.2% senior debentures due 2028	82			82
Variable rate bonds due 2030 (0.13% and 0.11% as of December 31, 2012 and 2011, respectively)	68			68
8.75% medium-term notes due 2023	22			22
	7,654			5,904
Less:
Unamortized discount, net	(31		)	(33		)
Current maturities	(600		)	—
Total	$	7,023		$	5,871

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 02
-Paragraph 22
-Article 5

Reference 2: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
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-Name Accounting Standards Codification
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-Name Accounting Standards Codification
-Topic 235
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-URI http://asc.fasb.org/extlink&oid=6881521&loc=d3e23780-122690

Future net minimum lease payments for noncancelable operating leases

LEASE COMMITMENTS (Tables)

12 Months Ended

Dec. 31, 2012

LEASE COMMITMENTS

In millions	Amount (a)
2013	$	158
2014	105
2015	106
2016	88
2017	59
Thereafter	460
Total minimum lease payments	$	976

(a) These amounts are net of sublease rentals of $3 million, which are to be received as follows (in millions): 2013—$2 and 2014—$1.

DERIVATIVES (Tables)

12 Months Ended

Dec. 31, 2012

Derivatives

Cash-flow hedges - pre-tax and after-tax gains and losses recognized in, and reclassified to income from, Accumulated Other Comprehensive Income (in millions)

	After-tax						Pre-Tax
	2012			2011			2012			2011
Beginning Balance - AOCI	$	1		$	(111	)
Unrealized gains recognized in AOCI	16			14			$	25		$	20
(Gains) losses reclassified to income	(24		)	98			$	(38	)	$	154
Ending Balance - AOCI	$	(7	)	$	1

Gross fair value of outstanding derivatives (in millions)

December 31, 2012	Asset Derivatives Balance Sheet Location	Fair Value			Liability Derivatives Balance Sheet Location	Fair Value
Cash-flow hedges (a)
	Other current assets	$	11		Accrued liabilities	$	1
Commodity contracts	Long-term receivables and other assets, net	—			Deferred credits and other liabilities	1
		$	11			$	2
Derivatives not designated as hedging instruments (a)
	Other current assets	$	386		Accrued liabilities	$	479
Commodity contracts	Long-term receivables and other assets, net	22			Deferred credits and other liabilities	16
		408				495
Total gross fair value		419				497
Less: counterparty netting and cash collateral (b)		(301		)		(371		)
Total net fair value of derivatives		$	118			$	126

December 31, 2011	Asset Derivatives Balance Sheet Location	Fair Value			Liability Derivatives Balance Sheet Location	Fair Value
Cash-flow hedges (a)
	Other current assets	$	41		Accrued liabilities	$	5
Commodity contracts	Long-term receivables and other assets, net	3			Deferred credits and other liabilities	—
		$	44			$	5
Derivatives not designated as hedging instruments (a)
	Other current assets	$	835		Accrued liabilities	$	887
Commodity contracts	Long-term receivables and other assets, net	71			Deferred credits and other liabilities	71
		906				958
Total gross fair value		950				963
Less: counterparty netting and cash collateral (c)		(758		)		(782		)
Total net fair value of derivatives		$	192			$	181

(a) Fair values are presented at gross amounts, including when the derivatives are subject to master netting arrangements and qualify for net presentation in the consolidated balance sheet.

(b) As of December 31, 2012, collateral received of $25 million has been netted against derivative assets and collateral paid of $95 million has been netted against derivative liabilities.

(c) As of December 31, 2011, collateral received of $42 million has been netted against derivative assets and collateral paid of $66 million has been netted against derivative liabilities.

Derivatives Not Designated as Hedging Instruments | Commodity Contracts

Derivatives

Schedule of outstanding derivative instruments

	Net Outstanding Position Long / (Short)
Commodity	2012		2011
Oil (million barrels)	(17	)	(9	)
Natural gas (billion cubic feet)	(217	)	(242	)
Precious metals (million troy ounces)	1		3

Tabular disclosure of pertinent information about a derivative or group of derivatives on a disaggregated basis, such as for individual instruments, or small groups of similar instruments. May include a combination of the type of instrument, risks being hedged, notional amount, hedge designation, related hedged item, inception date, maturity date, or other relevant item.

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
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Reference 5: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
-Topic 235
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-Paragraph 1
-Subparagraph (SX 210.4-08.(n)(2))
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-Name Accounting Standards Codification
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ENVIRONMENTAL LIABILITIES AND EXPENDITURES

ENVIRONMENTAL LIABILITIES AND EXPENDITURES (Tables)

12 Months Ended

Dec. 31, 2012

Environmental loss contingencies by categories of sites

$ amounts in millions	2012			2011			2010
	Number of Sites	Reserve Balance		Number of Sites	Reserve Balance		Number of Sites	Reserve Balance
NPL sites	35	$	54	36	$	63	38	$	56
Third-party sites	75	84		73	88		83	91
Occidental-operated sites	22	123		22	120		20	122
Closed or non-operated Occidental sites	29	83		29	89		29	97
Total	161	$	344	160	$	360	170	$	366

Environmental reserve activity

In millions	2012			2011			2010
Balance — Beginning of Year	$	360		$	366		$	403
Remediation expenses and interest accretion	56			53			26
Changes from acquisitions/dispositions	—			14			3
Payments	(72		)	(73		)	(66		)
Balance — End of Year	$	344		$	360		$	366

Environmental cost for each segment

In millions	2012		2011		2010
Operating Expenses
Oil and Gas	$	160	$	158	$	108
Chemical	70		68		72
Midstream and Marketing	20		21		13
	$	250	$	247	$	193
Capital Expenditures
Oil and Gas	$	122	$	110	$	72
Chemical	18		15		19
Midstream and Marketing	12		15		13
	$	152	$	140	$	104
Remediation Expenses
Corporate	$	56	$	52	$	25

DOMESTIC AND FOREIGN INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2012

DOMESTIC AND FOREIGN INCOME TAXES

Domestic and foreign components of income from continuing operations before domestic and foreign income taxes and net of noncontrolling interest amounts

For the years ended December 31, (in millions)	Domestic			Foreign		Total
2012	$	2,117	(a)	$	5,636	$	7,753
2011	$	4,806		$	6,035	$	10,841
2010	$	3,295		$	4,269	$	7,564

(a) Includes pre-tax charges of $1.8 billion for the impairment of domestic gas assets and related items.

Provisions (credits) for domestic and foreign income taxes on continuing operations

For the years ended December 31, (in millions)	United States Federal			State and Local		Foreign		Total
2012
Current	$	(401	)	$	8	$	2,383	$	1,990
Deferred	1,046			41		41		1,128
	$	645		$	49	$	2,424	$	3,118
2011
Current	$	320		$	88	$	2,357	$	2,765
Deferred	1,340			47		49		1,436
	$	1,660		$	135	$	2,406	$	4,201
2010
Current	$	614		$	79	$	1,896	$	2,589
Deferred	390			4		12		406
	$	1,004		$	83	$	1,908	$	2,995

Reconciliation of the United States federal statutory income tax rate to Occidental's worldwide effective tax rate on income from continuing operations is stated as a percentage of pre-tax income

For the years ended December 31,	2012		2011		2010
United States federal statutory tax rate	35	%	35	%	35	%
Operations outside the United States	5		4		5
State income taxes, net of federal benefit	1		1		1
Other	(1	)	(1	)	(1	)
Worldwide effective tax rate	40	%	39	%	40	%

Tax effects of temporary differences resulting in deferred income taxes

	2012					2011
Tax effects of temporary differences (in millions)	Deferred Tax Assets			Deferred Tax Liabilities		Deferred Tax Assets			Deferred Tax Liabilities
Property, plant and equipment differences	$	—		$	7,316	$	—		$	6,039
Equity investments, partnerships and foreign subsidiaries	—			351		—			351
Environmental reserves	126			—		131			—
Postretirement benefit accruals	413			—		410			—
Deferred compensation and benefits	278			—		286			—
Asset retirement obligations	367			—		318			—
Foreign tax credit carryforwards	1,277			—		1,240			—
Other tax credit carryforwards	195			—		—			—
Federal benefit of state income taxes	89			—		104			—
All other	334			161		374			116
Subtotal	3,079			7,828		2,863			6,506
Valuation allowance	(1,040		)	—		(1,003		)	—
Total deferred taxes	$	2,039		$	7,828	$	1,860		$	6,506

Reconciliation of the beginning and ending amount of unrecognized tax benefits

For the years ended December 31, (in millions)	2012			2011
Balance at January 1,	$	67		$	38
Additions based on tax positions related to the current year	16			44
Reductions based on tax positions related to prior years and settlements	(7		)	(15		)
Balance at December 31,	$	76		$	67

Tabular disclosure of tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities (i.e., uncertain tax positions) and other types of income tax contingencies, including: (1) the policy on classification of interest and penalties; (2) a tabular reconciliation of the total amounts of unrecognized tax benefits at the beginning and end of the period; the total amount(s) of: (3) unrecognized tax benefits that, if recognized, would affect the effective tax rate, and (4) interest and penalties recognized in each of the income statement and balance sheet; (5) for positions for which it is reasonably possible that the total amounts unrecognized will significantly change within 12 months of the reporting date the: (i) nature of the uncertainty, (ii) nature of the event that could occur that would cause the change, and (iii) an estimate of the range of the reasonably possible change or a statement that an estimate of the range cannot be made; and (6) a description of tax years that remain subject to examination by major tax jurisdictions.

Analysis of common stock issuances

STOCKHOLDERS' EQUITY (Tables)

12 Months Ended

Dec. 31, 2012

STOCKHOLDERS' EQUITY

Shares in thousands		Common Stock
Balance, December 31, 2009		883,643
Issued		967
Options exercised and other, net		665
Balance, December 31, 2010		885,275
Issued		1,302
Options exercised and other, net		232
Balance, December 31, 2011		886,809
Issued		1,746
Options exercised and other, net		246
Balance, December 31, 2012		888,801

Calculation of basic and diluted EPS

In millions, except per-share amounts	2012			2011			2010
Basic EPS
Income from continuing operations	$	4,635	(a)	$	6,640		$	4,641
Less: Income from continuing operations attributable to noncontrolling interest	—			—			(72		)
Income from continuing operations attributable to common stock	4,635			6,640			4,569
Discontinued operations, net	(37		)	131			(39		)
Net income attributable to common stock	4,598			6,771			4,530
Less: Net income allocated to participating securities	(8		)	(11		)	(6		)
Net income attributable to common stock, net of participating securities	$	4,590		$	6,760		$	4,524
Weighted average number of basic shares	809.3			812.1			812.5
Basic EPS	$	5.67		$	8.32		$	5.57

Diluted EPS
Net income attributable to common stock, net of participating securities	$	4,590		$	6,760		$	4,524
Weighted average number of basic shares	809.3			812.1			812.5
Dilutive effect of potentially dilutive securities	0.7			0.8			1.3
Total diluted weighted average common shares	810.0			812.9			813.8
Diluted EPS	$	5.67		$	8.32		$	5.56

(a) Includes after-tax charges of $1.1 billion for the impairment of domestic gas assets and related items.

Components of accumulated other comprehensive loss

Balance at December 31, (in millions)	2012			2011
Foreign currency translation adjustments	$	(34	)	$	(9	)
Unrealized gains (losses) on derivatives	(7		)	1
Pension and post-retirement adjustments (a)	(461		)	(475		)
Total	$	(502	)	$	(483	)

(a) See Note 13 for further information.

STOCK-BASED INCENTIVE PLANS (Tables)

12 Months Ended

Dec. 31, 2012

STOCK-BASED INCENTIVE PLANS

Summary of certain stock-based incentive amounts

For the years ended December 31, (in millions)	2012		2011		2010
Compensation expense	$	78	$	110	$	136
Income tax benefit recognized in the income statement	$	29	$	40	$	50
Intrinsic value of options and stock-settled SARs exercised	$	18	$	21	$	74
Cash paid (a)	$	83	$	124	$	97
Fair value of RSUs and TSRIs vested during the year (b)	$	28	$	53	$	19

(a) Includes cash paid under the cash-settled portion of the SARs, RSUs and TSRIs.

(b) As measured on the vesting date for the stock-settled portion of the RSUs and TSRIs.

Summary of changes in Occidental's unvested cash- and stock- settled RSUs

	Cash-Settled			Stock-Settled
	RSUs (000’s)		Weighted-Average Grant-Date Fair Value	RSUs (000’s)		Weighted-Average Grant-Date Fair Value
Unvested at January 1	1,272		$90.50	568		$93.14
Granted	729		$84.38	824		$84.81
Vested	(621	)	$83.61	(9	)	$88.21
Forfeitures	(48	)	$92.90	(8	)	$84.57
Unvested at December 31	1,332		$90.27	1,375		$88.23

Summary of Option and SAR transactions

Cash-Settled

Stock-Settled

SARs
(000’s)

Weighted-
Average
Exercise
Price

Weighted-
Average
Remaining
Contractual
Term (yrs)

Aggregate
Intrinsic
Value
(000’s)

SARs &
Options
(000’s)

Weighted-
Average
Exercise
Price

Weighted-
Average
Remaining
Contractual
Term (yrs)

Aggregate
Intrinsic
Value
(000’s)

Beginning balance, January 1

564

24.66

782

26.34

Exercised

(70

)

24.66

(245

)

14.22

Ending balance, December 31

494

24.66

1.5

25,639

537

31.88

2.0

24,008

Exercisable at December 31

494

24.66

1.5

25,639

537

31.88

2.0

24,008

Grant-date assumptions used in the Monte Carlo simulation models for the estimated payout level of TSRIs

	TSRIs
Year Granted	2012			2011			2010
Assumptions used:
Risk-free interest rate	0.4		%	0.6		%	0.6		%
Dividend yield	2.6		%	1.8		%	1.8		%
Volatility factor	34		%	33		%	32		%
Expected life (years)	3			3			3
Grant-date fair value of underlying Occidental common stock	$	84.57		$	102.97		$	84.29

Summary of Occidental's unvested TSRIs

	TSRIs
	Awards (000’s)		Weighted-Average Grant-Date Fair Value of Occidental Stock
Unvested at January 1 (a)	1,865			$	78.67
Granted (a)	453			$	84.57
Vested (b)	(388	)		$	77.00
Forfeitures	—			$	—
Unvested at December 31 (a)	1,930			$	80.39

(a) Unvested awards and award grants are presented at the target or mid-point payouts.

(b) The payout at vesting was 150 percent of the target for TSRIs.

RETIREMENT AND POSTRETIREMENT BENEFIT PLANS (Tables)

12 Months Ended

Dec. 31, 2012

RETIREMENT AND POSTRETIREMENT BENEFIT PLANS

Components of amounts recognized in the consolidated balance sheets (in millions)

	Pension Benefits						Postretirement Benefits
As of December 31,	2012			2011			2012			2011
Amounts recognized in the consolidated balance sheet:
Other assets	$	24		$	24		$	—		$	—
Accrued liabilities	(4		)	(5		)	(59		)	(47		)
Deferred credits and other liabilities — other	(136		)	(136		)	(1,068		)	(1,045		)
	$	(116	)	$	(117	)	$	(1,127	)	$	(1,092	)

After-tax balances included in AOCI (in millions)

	Pension Benefits				Postretirement Benefits
As of December 31,	2012		2011		2012		2011
AOCI included the following after-tax balances:
Net loss	$	134	$	146	$	324	$	331
Prior service cost	1		2		2		2
	$	135	$	148	$	326	$	333

Funding status of Occidental's plans (in millions)


For the years ended December 31,
Changes in benefit obligation:
Benefit obligation — beginning of year	$	592		$	615		$	1,092		$	991
Service cost — benefits earned during the period	13			12			25			22
Interest cost on projected benefit obligation	27			29			42			45
Actuarial loss	46			49			26			81
Foreign currency exchange rate (gain) loss	2			(5		)	—			—
Benefits paid	(57		)	(51		)	(58		)	(47		)
Settlements	(8		)	(57		)	—			—
Benefit obligation — end of year	$	615		$	592		$	1,127		$	1,092

Changes in plan assets:
Fair value of plan assets — beginning of year	$	475		$	495		$	—		$	—
Actual return on plan assets	61			13			—			—
Foreign currency exchange rate gain (loss)	(3		)	(3		)	—			—
Employer contributions	31			78			—			—
Benefits paid	(57		)	(51		)	—			—
Settlements	(8		)	(57		)	—			—
Fair value of plan assets — end of year	$	499		$	475		$	—		$	—
Unfunded status:	$	(116	)	$	(117	)	$	(1,127	)	$	(1,092	)

Schedule of projected benefit obligation, accumulated benefit obligation and fair value of plan assets for defined benefit pension plans with an accumulated benefit obligation in excess of plan assets and plan assets in excess of the accumulated benefit obligation

	Accumulated Benefit Obligation in Excess of Plan Assets				Plan Assets in Excess of Accumulated Benefit Obligation
As of December 31, (in millions)	2012		2011		2012		2011
Projected Benefit Obligation	$	305	$	361	$	310	$	231
Accumulated Benefit Obligation	$	278	$	334	$	305	$	227
Fair Value of Plan Assets	$	171	$	226	$	328	$	249

Components of the net periodic benefit cost

	Pension Benefits									Postretirement Benefits
For the years ended December 31, (in millions)	2012			2011			2010			2012		2011		2010
Net periodic benefit costs:
Service cost — benefits earned during the period	$	13		$	12		$	16		$	25	$	22	$	19
Interest cost on benefit obligation	27			29			30			42		45		44
Expected return on plan assets	(31		)	(33		)	(31		)	—		—		—
Recognized actuarial loss	19			13			15			37		31		27
Other costs and adjustments	17			—			10			1		1		1
Net periodic benefit cost	$	45		$	21		$	40		$	105	$	99	$	91

Weighted-average assumptions used to determine Occidental's benefit obligation and net periodic benefit cost for domestic plans

	Pension Benefits				Postretirement Benefits
For the years ended December 31,	2012		2011		2012		2011
Benefit Obligation Assumptions:
Discount rate	3.59	%	4.12	%	3.89	%	4.12	%
Rate of compensation increase	4.00	%	4.00	%	—		—
Net Periodic Benefit Cost Assumptions:
Discount rate	4.12	%	4.74	%	4.12	%	4.74	%
Assumed long term rate of return on assets	6.50	%	6.50	%	—		—
Rate of compensation increase	4.00	%	4.00	%	—		—

Fair values of Occidental's pension plan assets by asset category (in millions)

	Fair Value Measurements at December 31, 2012 Using
Description	Level 1		Level 2		Level 3		Total
Asset Class:
U.S. government securities	$	24	$	—	$	—	$	24
Corporate bonds (a)	—		83		—		83
Common/collective trusts (b)	—		11		—		11
Mutual funds:
Bond funds	84		—		—		84
Blend funds	106		—		—		106
Value and growth funds	5		—		—		5
Common and preferred stocks (c)	146		—		—		146
Other	—		35		11		46
Total pension plan assets (d)	$	365	$	129	$	11	$	505

	Fair Value Measurements at December 31, 2011 Using
Description	Level 1		Level 2		Level 3		Total
Asset Class:
U.S. government securities	$	22	$	—	$	—	$	22
Corporate bonds (a)	—		83		—		83
Common/collective trusts (b)	—		14		—		14
Mutual funds:
Bond funds	84		—		—		84
Blend funds	97		—		—		97
Value and growth funds	5		—		—		5
Common and preferred stocks (c)	131		—		—		131
Other	—		34		12		46
Total pension plan assets (d)	$	339	$	131	$	12	$	482

(a) This category represents investment grade bonds of U.S. and non-U.S. issuers from diverse industries.

(b) This category includes investment funds that primarily invest in U.S. and non-U.S. common stocks and fixed-income securities.

(c) This category represents direct investments in common and preferred stocks from diverse U.S. and non-U.S. industries.

(d) Amounts exclude net payables of approximately $6 million and $7 million as of December 31, 2012 and 2011, respectively.

Estimated future benefit payments, which reflect expected future service, as appropriate

For the years ended December 31, (in millions)	Pension Benefits		Postretirement Benefits
2013	$	40	$	50
2014	$	44	$	51
2015	$	41	$	52
2016	$	46	$	53
2017	$	42	$	54
2018 — 2022	$	230	$	294

INVESTMENTS AND RELATED-PARTY TRANSACTIONS (Tables)

12 Months Ended

Dec. 31, 2012

INVESTMENTS AND RELATED-PARTY TRANSACTIONS

Summarized financial information of equity-method investments

For the years ended December 31, (in millions)	2012		2011		2010
Revenues	$	2,667	$	2,439	$	1,759
Costs and expenses	2,310		2,046		1,482
Net income	$	357	$	393	$	277

As of December 31, (in millions)	2012		2011
Current assets	$	2,065	$	2,230
Non-current assets	$	5,104	$	4,381
Current liabilities	$	1,774	$	1,532
Long-term debt	$	2,250	$	2,305
Other non-current liabilities	$	241	$	168
Stockholders’ equity	$	2,904	$	2,606

Related-party transactions

December 31, (in millions)	2012		2011		2010
Purchases (a)	$	8	$	10	$	153
Sales (b)	$	419	$	392	$	440
Services	$	17	$	10	$	2
Advances and amounts due from	$	25	$	32	$	135
Amounts due to	$	129	$	21	$	383

(a) In 2010, purchases from EHP accounted for 90 percent of total purchases.

FAIR VALUE MEASUREMENTS (Tables)

12 Months Ended

Dec. 31, 2012

FAIR VALUE MEASUREMENTS

Assets and liabilities measured at fair value on a recurring basis (in millions)

	Fair Value Measurements at December 31, 2012 Using						Netting and			Total
Description	Level 1		Level 2		Level 3		Collateral (a)			Fair Value
Assets:
Commodity derivatives	$	107	$	312	$	—	$	(301	)	$	118
Liabilities:
Commodity derivatives	$	99	$	398	$	—	$	(371	)	$	126

	Fair Value Measurements at December 31, 2011 Using						Netting and			Total
Description	Level 1		Level 2		Level 3		Collateral (a)			Fair Value
Assets:
Commodity derivatives	$	310	$	640	$	—	$	(758	)	$	192
Liabilities:
Commodity derivatives	$	311	$	652	$	—	$	(782	)	$	181

(a) Represents the impact of netting assets, liabilities and collateral when a legal right of offset exists.

INDUSTRY SEGMENTS AND GEOGRAPHIC AREAS (Tables)

12 Months Ended

Dec. 31, 2012

INDUSTRY SEGMENTS AND GEOGRAPHIC AREAS

Industry segment and corporate disclosures

In millions	Oil and Gas			Chemical			Midstream and Marketing			Corporate and Eliminations			Total
YEAR ENDED DECEMBER 31, 2012
Net sales	$	18,906	(a)	$	4,580	(b)	$	1,399	(c)	$	(713	)	$	24,172
Pretax operating profit (loss)	$	7,095	(d)	$	720		$	439		$	(501)	(f,h)	$	7,753
Income taxes	—			—			—			(3,118)		(g,h)	(3,118		)
Discontinued operations, net	—			—			—			(37		)	(37		)
Net income (loss) attributable to common stock	$	7,095		$	720		$	439		$	(3,656	)	$	4,598
Investments in unconsolidated entities	$	113		$	108		$	1,662		$	11		$	1,894
Property, plant and equipment additions, net (i)	$	8,282		$	365		$	1,612		$	91		$	10,350
Depreciation, depletion and amortization	$	3,933		$	345		$	206		$	27		$	4,511
Total assets	$	44,004		$	3,854		$	12,762		$	3,590		$	64,210
YEAR ENDED DECEMBER 31, 2011
Net sales	$	18,419	(a)	$	4,815	(b)	$	1,447	(c)	$	(742	)	$	23,939
Pretax operating profit (loss)	$	10,241	(d)	$	861		$	448		$	(709)	(f,h)	$	10,841	(d)
Income taxes	—			—			—			(4,201)		(g,h)	(4,201		)
Discontinued operations, net	—			—			—			131			131
Net income (loss) attributable to common stock	$	10,241	(d)	$	861		$	448		$	(4,779	)	$	6,771
Investments in unconsolidated entities	$	128		$	121		$	1,812		$	11		$	2,072
Property, plant and equipment additions, net (i)	$	6,192		$	241		$	1,120		$	51		$	7,604
Depreciation, depletion and amortization	$	3,064		$	330		$	173		$	24		$	3,591
Total assets	$	38,967		$	3,754		$	11,962		$	5,361		$	60,044
YEAR ENDED DECEMBER 31, 2010
Net sales	$	14,276	(a)	$	4,016	(b)	$	1,471	(c)	$	(718	)	$	19,045
Pretax operating profit (loss)	$	7,151	(d,e)	$	438		$	472		$	(497)	(f,h)	$	7,564	(d,e)
Income taxes	—			—			—			(2,995)		(g,h)	(2,995		)
Discontinued operations, net	—			—			—			(39		)	(39		)
Net income (loss) attributable to common stock	$	7,151	(d,e)	$	438		$	472		$	(3,531	)	$	4,530	(e)
Investments in unconsolidated entities	$	123		$	135		$	1,770		$	11		$	2,039
Property, plant and equipment additions, net (i)	$	3,211		$	248		$	537		$	38		$	4,034
Depreciation, depletion and amortization	$	2,668		$	321		$	142		$	22		$	3,153
Total assets	$	31,855		$	3,755		$	10,445		$	6,377	(j)	$	52,432

Total product sales for the chemical segment

	Basic Chemicals		Vinyls		Other Chemicals
Year ended December 31, 2012	57	%	40	%	3	%
Year ended December 31, 2011	58	%	39	%	3	%
Year ended December 31, 2010	57	%	40	%	3	%

Total sales for the midstream and marketing segment

	Gas Processing		Power		Marketing, Trading, Transportation and other
Year ended December 31, 2012	59	%	20	%	21	%
Year ended December 31, 2011	64	%	27	%	9	%
Year ended December 31, 2010	52	%	27	%	21	%

Significant items affecting earnings included in the Corporate segment

Benefit (Charge) (In millions)	2012			2011			2010
CORPORATE
Pre-tax operating profit (loss)
Premium on debt extinguishments	$	—		$	(163	)	$	—
Litigation reserves	(20		)	—			—
	$	(20	)	$	(163	)	$	—
Income taxes
State income tax charge	$	—		$	(33	)	$	—
Foreign tax credit carryforwards	—			—			80
Tax effect of pre-tax adjustments *	636			50			100
	$	636		$	17		$	180

* Amounts represent the tax effect of all pre-tax adjustments listed, as well as those in footnote (d).

Net sales and property, plant and equipment by geographic areas

In millions

	Net sales (a)						Property, plant and equipment, net
For the years ended December 31,	2012		2011		2010		2012		2011		2010
United States	$	15,359	$	15,040	$	12,151	$	40,786	$	36,283	$	28,571
Foreign
Qatar	3,356		3,432		2,677		2,676		2,735		2,823
Oman	2,578		2,500		1,666		2,353		2,143		1,967
Colombia	1,027		1,054		999		1,041		854		715
Yemen	407		907		766		199		245		347
Bahrain	215		187		100		688		477		222
United Arab Emirates	—		—		—		2,104		971		1
Other Foreign	1,230		819		686		2,217		1,976		1,890
Total Foreign	8,813		8,899		6,894		11,278		9,401		7,965
Total	$	24,172	$	23,939	$	19,045	$	52,064	$	45,684	$	36,536

(a) Sales are shown by individual country based on the location of the entity making the sale.

Tabular disclosure of the profit or loss and total assets for each reportable segment. An entity discloses certain information on each reportable segment if the amounts (a) are included in the measure of segment profit or loss reviewed by the chief operating decision maker or (b) are otherwise regularly provided to the chief operating decision maker, even if not included in that measure of segment profit or loss.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) $ in Millions	12 Months Ended
	Dec. 31, 2012 USD ($)	Dec. 31, 2011 USD ($) yr Item	Dec. 31, 2010 USD ($)
RISKS AND UNCERTAINTIES
Assets, relating to operations in countries outside North America	$ 12,300
Net sales, relating to operations in countries outside North America	8,800
CASH AND CASH EQUIVALENTS
Total cash equivalents	1,000	$ 3,500
PROPERTY, PLANT AND EQUIPMENT
Maximum time period after which costs of exploratory wells are charged to expense if determination of proved reserves has not been made (in months) \| Item		12
Net capitalized costs attributable to unproved properties	4,800
Capitalized exploratory well costs for the years ended December 31:
Balance - Beginning of Year	182	$ 73	$ 51
Additions to capitalized exploratory well costs pending the determination of proved reserves	400	334	112
Reclassifications to property, plant and equipment based on the determination of proved reserves	(407)	(204)	(73)
Capitalized exploratory well costs charged to expense	(77)	(21)	(17)
Balance - End of Year	98	$ 182	73
The estimated useful lives of Occidental's chemical assets, low end of range (in years) \| yr		3
The estimated useful lives of Occidental's chemical assets, high end of range (in years) \| yr		50
ACCRUED LIABILITIES-CURRENT
Accrued liabilities for accrued payroll, commissions and related expenses	385	$ 462
ENVIRONMENTAL LIABILITIES AND EXPENDITURES
Period exceeding the minimum period often taken for comprehensive environmental response for CERCLA sites (in years) \| yr		10
ASSET RETIREMENT OBLIGATIONS
Asset retirement obligation, included in deferred credits and other liabilities-other	1,212	$ 1,030
For the years ended December 31, (in millions)
Beginning balance	1,089	800
Liabilities incurred - capitalized to PP&E	86	74
Liabilities settled and paid	(58)	(53)
Accretion expense	61	48
Acquisitions and other - capitalized to PP&E	50	177
Revisions to estimated cash flows - capitalized to PP&E	38	43
Ending balance	$ 1,266	1,089	800
DERIVATIVE INSTRUMENTS
Range used to determine if derivative instrument is effective, low end of range (as a percent)	80.00%
Range used to determine if derivative instrument is effective, high end of range (as a percent)	125.00%
Supplemental Cash Flow Information.
Interest Paid	$ 190	315	161
Debt extinguishment premium
Supplemental Cash Flow Information.
Interest Paid		154
Continuing operations
Supplemental Cash Flow Information.
U.S. federal, state and foreign income taxes paid	2,400	2,900	2,400
Production, property and other taxes paid	$ 694	$ 635	$ 510

ACQUISITIONS, DISPOSITIONS AND OTHER TRANSACTIONS (Details) $ in Millions	1 Months Ended	3 Months Ended
	Nov. 30, 2012 mi bbl	Mar. 31, 2011 yr	Dec. 31, 2012 USD ($)	Dec. 31, 2011 USD ($)	May 31, 2011 USD ($)
Acquisitions, dispositions and other transactions
Length of BridgeTex Pipeline \| mi	450
Maximum
Acquisitions, dispositions and other transactions
BridgeTex Pipeline, crude oil transportation capacity per day \| bbl	300,000
Domestic Oil and Gas Properties
Acquisitions, dispositions and other transactions
Cash paid on acquisition			$ 2,300
Producing properties in South Texas
Acquisitions, dispositions and other transactions
Cash paid on acquisition				$ 1,800
Al Hosn gas project
Acquisitions, dispositions and other transactions
Percentage of interest acquired in oil and gas properties and projects		40.00%
Term of joint venture agreement (in years) \| yr		30
Pre-acquisition development expenditures					$ 500
Domestic Oil and Gas Properties
Acquisitions, dispositions and other transactions
Cash paid on acquisition				$ 2,600

ACQUISITIONS, DISPOSITIONS AND OTHER TRANSACTIONS (Details 2) - BridgeTex bbl in Millions, $ in Millions	12 Months Ended
	Dec. 31, 2012 USD ($) bbl
Acquisitions, dispositions and other transactions
Aggregate oil storage capacity of pipeline to be constructed \| bbl	2.6
Percentage of ownership interest	50.00%
Money market mutual funds \| $	$ 50
Magellan
Acquisitions, dispositions and other transactions
Percentage of interest acquired in oil and gas properties and projects	50.00%

ACQUISITIONS, DISPOSITIONS AND OTHER TRANSACTIONS (Details 3) $ in Millions	3 Months Ended
	Mar. 31, 2011 USD ($)
Libya activity
Acquisitions, dispositions and other transactions
Capitalized and suspended exploration costs written off	$ 35

ACQUISITIONS, DISPOSITIONS AND OTHER TRANSACTIONS (Details 4) $ in Millions	1 Months Ended	12 Months Ended
	Feb. 28, 2011 USD ($)	Dec. 31, 2011 USD ($)	Dec. 31, 2010 USD ($) yr
General Partner of Plains All American Pipeline
Asset acquisitions, dispositions and other transactions
Significant acquisitions (sales)			$ 430
Equity method investment ownership percentage			35.00%
Elk Hills Power
Asset acquisitions, dispositions and other transactions
Significant acquisitions (sales)			$ 175
Equity method investment additional ownership percentage			50.00%
Total ownership percentage			100.00%
China Petrochemical Corporation (Sinopec) \| Argentina
Asset acquisitions, dispositions and other transactions
Significant acquisitions (sales)			$ (2,600)
Pre-tax gain on sale	$ 225
Net revenues of discontinued operations		$ 97	700
Pre-tax income (losses) of discontinued operations		$ 2	(39)
North Dakota Oil Producing and Prospective Properties
Asset acquisitions, dispositions and other transactions
Significant acquisitions (sales)			1,400
Operating, Producing Properties in the Permian, Midcontinent Region and California
Asset acquisitions, dispositions and other transactions
Significant acquisitions (sales)			$ 2,800
Zubair Field development project
Asset acquisitions, dispositions and other transactions
Length of contract (in years) \| yr			20

INVENTORIES (Details) - USD ($) $ in Millions	Dec. 31, 2012	Dec. 31, 2011
INVENTORIES
Net carrying values of inventories valued under the LIFO method	$ 185	$ 176
Inventories
Raw materials	70	69
Materials and supplies	612	443
Finished goods	763	655
Inventories, Gross	1,445	1,167
LIFO reserve	(101)	(98)
Total	$ 1,344	$ 1,069

Carrying amount as of the balance sheet date of products used directly or indirectly in the manufacturing or production process, which may or may not become part of the final product. May also include items used in the storage, presentation or transportation of physical goods.