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Filed by Occidental Petroleum Corporation
Pursuant to Rule 425 under the Securities Act of 1933
and deemed filed pursuant to Rule 14a-12
under the Securities Exchange Act of 1934
Subject Company: Anadarko Petroleum Corporation
Commission File No.: 001-08968
First Quarter 2019Earnings Conference Call Occidental Petroleum Corporation May 6, 2019
Cautionary Statements Forward-Looking StatementsAny statements in this presentation about
Occidental Petroleum Corporation’s (“Occidental”) expectations, beliefs, plans or forecasts, including statements regarding the proposed transaction between Occidental and Anadarko Petroleum Corporation (“Anadarko”) or the proposed
transaction between Occidental and Total S.A. (“Total”), benefits and synergies of the proposed transactions and future opportunities for the combined company and products and securities, that are not historical facts are forward-looking
statements. These statements are typically identified by words such as “estimate,” “project,” “predict,” “will,” “would,” “should,” “could,” “may,” “might,” “anticipate,” “plan,” “intend,” “believe,” “expect,” “aim,” “goal,” “target,”
“objective,” “likely” or similar expressions that convey the prospective nature of events or outcomes. Forward-looking statements involve estimates, expectations, projections, goals, forecasts, assumptions, risks and uncertainties. Actual
results may differ from anticipated results, sometimes materially, and reported or expected results should not be considered an indication of future performance. Factors that could cause actual results to differ include, but are not limited
to: global commodity pricing fluctuations; changes in supply and demand for Occidental’s products; higher-than-expected costs; the regulatory approval environment; not successfully completing, or any material delay of, field developments,
expansion projects, capital expenditures, efficiency projects, acquisitions or dispositions; technological developments; uncertainties about the estimated quantities of oil and natural gas reserves; lower-than-expected production from
operations, development projects or acquisitions; exploration risks; general economic slowdowns domestically or internationally; political conditions and events; liability under environmental regulations including remedial actions;
litigation; disruption or interruption of production or manufacturing or facility damage due to accidents, chemical releases, labor unrest, weather, natural disasters, cyber-attacks or insurgent activity; and failures in risk management.
Such factors also include the ultimate outcome of any possible transaction between Occidental and Anadarko, including the possibility that Anadarko will reject the proposed transaction with Occidental or that the terms of any definitive
agreement will be materially different from those described herein; uncertainties as to whether Anadarko will cooperate with Occidental regarding the proposed transaction; Occidental’s ability to consummate the proposed transaction with
Anadarko or the proposed transactions with Total; the conditions to the completion of the proposed transactions, including the receipt of Anadarko stockholder approval for the proposed transaction between Occidental and Anadarko; that the
regulatory approvals required for the proposed transactions may not be obtained on the terms expected or on the anticipated schedule or at all; Occidental’s ability to finance the proposed transaction with Anadarko, including completion of
any contemplated equity investment; Occidental’s indebtedness, including the substantial indebtedness Occidental expects to incur in connection with the proposed transaction with Anadarko and the need to generate sufficient cash flows to
service and repay such debt; Occidental’s ability to meet expectations regarding the timing, completion and accounting and tax treatments of the transactions contemplated by the binding agreement with Total; Occidental’s ability to meet
expectations regarding the timing, completion and accounting and tax treatments of the proposed transaction with Anadarko; the possibility that Occidental may be unable to achieve expected synergies and operating efficiencies within the
expected time-frames or at all and to successfully integrate Anadarko’s operations with those of Occidental; that such integration may be more difficult, time-consuming or costly than expected; that operating costs, customer loss and
business disruption (including, without limitation, difficulties in maintaining relationships with employees, customers or suppliers) may be greater than expected following the proposed transaction or the public announcement of the proposed
transaction; the retention of certain key employees of Anadarko may be difficult; that Anadarko and Occidental are subject to intense competition and increased competition is expected in the future; general economic conditions that are less
favorable than expected. Additional risks that may affect Occidental’s results of operations and financial position appear in Part I, Item 1A “Risk Factors” of Occidental’s Annual Report on Form 10-K for the year ended December 31, 2018,
and in Occidental’s other filings with the U.S. Securities and Exchange Commission (“SEC”). Because the factors referred to above could cause actual results or outcomes to differ materially from those expressed or implied in any
forward-looking statements, you should not place undue reliance on any such forward-looking statements. Further, any forward-looking statement speaks only as of the date of this presentation and, unless legally required, Occidental does not
undertake any obligation to update any forward-looking statement, as a result of new information, future events or otherwise.No Offer or SolicitationThis presentation does not constitute an offer to sell or the solicitation of an offer to
buy any securities or a solicitation of any vote or approval, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the
securities laws of any such jurisdiction. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended.Additional Information and Where to Find ItThis
presentation relates to a proposal which Occidental has made for an acquisition of Anadarko. In furtherance of this proposal and subject to future developments, Occidental (and, if a negotiated transaction is agreed, Anadarko) may file one
or more registration statements, proxy statements, tender offer statements or other documents with the SEC. This presentation is not a substitute for any proxy statement, registration statement, tender offer statement, prospectus or other
document Occidental and/or Anadarko may file with the SEC in connection with the proposed transactions. INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE PROXY STATEMENT(S), REGISTRATION STATEMENT(S), TENDER OFFER STATEMENT, PROSPECTUS
AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC CAREFULLY IN THEIR ENTIRETY IF AND WHEN THEY BECOME AVAILABLEBECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT OCCIDENTAL, ANADARKO AND THE PROPOSED TRANSACTIONS. Any definitive proxy
statement(s) or prospectus(es) (if and when available) will be mailed to stockholders of Occidental and/or Anadarko, as applicable. Investors and security holders will be able to obtain copies of these documents (if and when available) and
other documents filed with the SEC by Occidental free of charge through the website maintained by the SEC at www.sec.gov. Copies of the documents filed by Occidental (if and when available) will also be made available free of charge by
accessing Occidental’s website at www.oxy.com.ParticipantsThis presentation is neither a solicitation of a proxy nor a substitute for any proxy statement or other filings that may be made with the SEC. Nonetheless, Occidental and its
directors and executive officers and other members of management and employees may be deemed to be participants in the solicitation of proxies in respect of the proposed transactions. Information about Occidental’s executive officers and
directors is available in Occidental’s Annual Report on Form 10-K for the year ended December 31, 2018, which was filed with the SEC on February 21, 2019, and in its proxy statement for the 2019 Annual Meeting which was filed with the SEC
on March 28, 2019. To the extent holdings of Occidental securities have changed since the amounts printed in the proxy statement for the 2019 Annual Meeting, such changes have been or will be reflected on Statements of Change in Ownership
on Form 4 filed with the SEC. Additional information regarding the interests of such potential participants will be included in one or more registration statements, proxy statements, tender offer statements or other documents filed with the
SEC if and when they become available. These documents (if and when available) may be obtained free of charge from the SEC’s website. http://www.sec.gov.Use of non-GAAP Financial InformationThis presentation includes non-GAAP financial
measures. Where available, reconciliations to comparable GAAP financial measures can be found on Occidental's website at www.oxy.com. Occidental is unable to provide a reconciliation of non-GAAP financial measures contained in this
presentation that are presented on a forward-looking basis because Occidental is unable, without unreasonable efforts, to estimate and quantify the most directly comparable GAAP components, largely because predicting future operating
results is subject to many factors outside of Occidental's control and not readily predictable and that are not part of Occidental's routine operating activities, including various domestic and international economic, regulatory, political
and legal factors.Cautionary Note to U.S. InvestorsThe SEC permits oil and gas companies, in their filings with the SEC, to disclose only proved, probable and possible reserves. Any reserve estimates provided in this presentation that are
not specifically designated as being estimates of proved reserves may include "potential" reserves and/or other estimated reserves not necessarily calculated in accordance with, or contemplated by, the SEC’s latest reserve reporting
guidelines. U.S. investors are urged to consider closely the oil and gas disclosures in our 2018 Form 10-K and other reports and filings with the SEC. Copies are available from the SEC and through our website, www.oxy.com.
Occidental Petroleum First Quarter HighlightsFinancial Summary and Guidance Closing
Remarks
1 Year to date annualized; see the reconciliation to comparable GAAP financial measures
on our website.2Source: IHS Enerdeq as of 4/17/2019, horizontals with 6 months oil production available since September 2017 and laterals >500 ft 1Q19 Highlights Focused on Returns & Cash Flow Generation Operational
Excellence Integrated Business Returned $800 MM (45% of CFFO before working capital) to shareholders through dividends and share repurchasesContinued to deliver sector leading returns; CROCE1 of 21% and ROCE1 of 9% Oxy delivered 23 of
the top 100 wells on a six-month cumulative oil production basis while only drilling 4% of the wells in the Permian2New International completion pilots showing positive results with regional potential Integrated business model continued to
drive strong results as evidenced by all three business segments exceeding guidanceAdvancing Midwest industrial carbon capture (CO2) opportunities
2018 Return On Capital and Return Of Capital
OXY -5% 0% 5% 10% 15% 20% 12% 14% 16% 18% ROCE (%) 8% 10%Total Yield1 (%) 0% 2% 4% 6%1Total Yield = (Dividend + Repurchase) / Market Capitalization on December 31, 20182See the reconciliation to comparable GAAP financial
measures on our website.Note: Bubble Size represents Distribution = (Dividend + Repurchase) / OCF Note: Peers Include: APA, APC, CNQ, COP, CVX, EOG, HES, MRO, TOT, XOM Returned $3.6 B to shareholders in 2018, including $1.3 B of share
repurchasesSince 2002, returned $34 B of Total Capital through 1Q19Sector leading returns, achieved 14% ROCE and 27% CROCE in 20182
1Q19 Permian Highlights Permian Resources Subsurface TechnicalExcellence Basin-leadingWells
Operational Efficiency & Speed Logistics & Strategic Relationships D&C Outperformance Aventine Logistics Hub InfrastructureInvestment Leader in Water Recycling Production Transport& Realizations Enhanced Oil
Recovery Secure Takeaway& Export CapacityUnconventional& CCUSLeadership Permian Execution Excellence 6 > Well productivity outperforming peer average by over 45% across the Delaware Basin> Implementing new facility design
resulting in 60% fewer tanks, emissions reduction, and >30% cost improvement> TX Delaware 26% drill days improvement and 34% frac days improvement from 2018 to 2019> Subsurface characterization driving successful appraisal
anddevelopment results in five New Mexico benches> Completed delineation of Hoban – Wolfcamp A co-development in TX Delaware> Anticipating start of sectional EOR program in TX Delaware Permian EOR > Strong production results from
base surveillance programs> Progressing CO2 pilots for future anthropogenic CO2 potential
Occidental Petroleum First Quarter Highlights Financial Summary and Guidance Closing
Remarks
1Q19 Results 8 Note: See the reconciliations to comparable GAAP financial measures on
our website Reported diluted EPS $0.84 Core diluted EPS $0.84 1Q19 CFFO before working capital $1.8 B 1Q19 capital expenditures $1.3 B Dividend payments $0.6 B Share repurchases $0.2 B Cash balance as of 03/31/19 $1.8 B Total
reported production (Boed) 719,000 Total Permian Resources production (Boed) 261,000 1Q19 Actual versus GuidanceMidpoint Reconciliation Boed Permian Resources execution and well productivity +2,500 Permian EOR production
outperformance +3,000 International: > New completions designs lead to strong new well performance +2,000 > Al Hosn maintenance timing +2,000
2019 Guidance Oil & Gas Segment FY 2019E Production > Total production of 715 -
730 Mboed > Permian Resources production of 278 - 288 Mboed > International production of 278 - 283 Mboed2Q19E Production > Total production of 723 - 735 Mboed > Permian Resources production of 274 - 282 Mboed > International
production of 291 - 293 MboedInternational production is estimated at Brent 2019 calendar strip as of 5/3/2019Production Costs – FY 2019EDomestic Oil & Gas: ~$11.00 / boe DD&A – FY 2019E Midstream OxyChem Corporate Exploration
Expense ~$30 MM in 2Q19E ~$130 MM in FY 2019EOil & Gas: ~$13.50 / boe OxyChem and Midstream: $700 MM$300 - $375 MM pre-tax income in 2Q19E > Midland - MEH spread of $8.50 - $10.00 / Bbl~$200 MM pre-tax income in 2Q19E $925 - $950 MM
pre-tax income in FY 2019 EFY 2019 E Domestic tax rate: 21% FY 2019E International tax rate: 45% Interest expense of $90 MM in 2Q19E
Occidental Petroleum First Quarter Highlights Financial Summary and Guidance Closing
Remarks
Appendix Contents Financial Information Executive Compensation Oil and Gas Updates
Cash Flow Sensitivities in 2Q19 Oil & GasAnnualized cash flow changes ~$130 MM per
~$1.00 / bbl change in oil prices> ~$100 MM per ~$1.00 / bbl change in WTI prices> ~$30 MM per ~$1.00 / bbl change in Brent pricesAnnualized cash flow changes ~$35 MM per ~$0.50 / Mmbtu change in natural gas pricesAnnualized
production changes 800 – 1,000 Boed per ~$1.00 / bbl change in Brent pricesOxyChemAnnualized cash flow changes ~$30 MM per ~$10 / ton change in realized caustic soda pricesMidstreamAnnualized cash flow changes ~$45 MM per ~$0.25 / bbl
change in Midland to MEH spread> ~35 day lag due to trade month
2019 Cash Flow and Cash Balance Reconciliation Beginning Cash Balance 01/01/19 CFFO
Before Working Capital Dividends Share Repurchases Capital Expenditures Working Capital / Other Ending Cash Balance 03/31/19 $1.8 ($0.2) $1.8 $3.0 ($1.3) ($0.6) ($0.9) $ B
Appendix Contents Financial Information Executive Compensation Oil and Gas Updates
2019 Changes to Annual Cash Incentive Sustainability made as a stand-alone key corporate
objective and increased weight from 3% to 10% of target company performance Executive Compensation Program Objectives Align with shareholderinterestsPreserve performance accountability Build long-term shareownership Provide consistent
retention incentive Straightforward and transparentMatch or exceed governance standards 1CROCE defined as (Net Income + DD&A + After-tax Interest Expense) / Average (Total Debt + Total Equity) 1
Appendix Contents Financial Information Executive Compensation Oil and Gas Updates
Core Development Areas Delivering Impressive Results – Greater Sand Dunes Subsurface
Characterization is Driving Basin Leading Results Subsurface characterization mitigating parent-child effect and preserving well performance > 96% of Bone Spring development wells online YTD have an offset producing well 3D seismic to
map geomechanical flow units and optimize landing Continued basin leading development Bone Spring results: > 1Q 23 Wells Online ~9,802 ft> 1Q Avg IP 24 = 5,595 Boed1> 1Q Avg IP 30 = 4,239 Boed1 Avalon/1st Bone Spring/Wolfcamp A
appraisal results:> 5 Wells Online ~9,696 ft> Avg IP 30 = 2,929 Boed 201852 Wells ~9,950’ ~45% Better Than the Average New Mexico Operator2~9,800’ 1Three stream production results2Peer data sourced from IHS Performance Evaluator
and represents an average of Peers with greater than two wells online in 2018 for New Mexico Bone Spring wells with a lateral length greater than 9,500 ft Days OnlinePeak 30 Day Production (Boed)Greater Sand Dunes Bone Spring - 10K
wells Cumulative Production (Mboe)Greater Sand Dunes Bone Spring - 10K wells 52 wells 22 wells 201922 Wells ~10,000’
Scalable Performance Improvements Increasing Asset Value New well design and subsurface
characterization improving wellresults > Landing optimization based on seismic> Increased completion effectiveness through higher pump rates and improved sand placement Large contiguous acreage position with large
inventoryMulti-bench development utilizes existing infrastructureDrilled 10K well in Oxy record of 15 daysImprovements generating peer-leading results in Southern Delaware > 1Q 12 Wells Online ~9,638 ft> 1Q Avg IP 24 = 3,283
Boed1> 1Q Avg IP 30 = 2,578 Boed1 100% of wells online YTD have an offset producing well Core Development Areas Delivering Impressive Results – Barilla Draw 201821 Wells ~10,100’ ~50% Better Than the AverageTX Delaware
Operator2~10,000’ 1Three stream production results2Peer data sourced from IHS Performance Evaluator and represents an average of Peers with greater than two wells online in 2018 for Wolfcamp oil wells in Texas Delaware with a lateral
length greater than 9,500 ft3Delineation and Co-Development of the Hoban and Wolfcamp A 201911 Wells ~10,100’ Days OnlinePeak 30 Day Production (Boed)Barilla Draw Wolfcamp A & Hoban - 10K wells Cumulative Production (Mboe)Barilla
Draw Wolfcamp A & Hoban - 10K wells 21 wells Development - 2 wellsDelineation3 - 9 wells
0 50 100 150 200 250 0 180 Permian Resources Hz Unconventional Well
Performance Continuous Improvement in Permian Resources Well Performance Subsurface Characterization Data Analytics Innovative Well Designs Oxy Drilling DynamicsFocused Development 2015 2016 2017 2018 147% Improvement since 2015 25%
Improvement from 2017 to 2018 Note: Data includes all horizontal Permian unconventional wells online in each year Cumulative Mboe 90 Days
Jeff Alvarez Vice President - Investor Relations 713.215.7864 |
jeff_alvarez@oxy.com Neil Backhouse Director - Investor Relations 713.366.5604 | neil_backhouse@oxy.com