EX-99 2 ex991-20070530.htm EXHIBIT 99.1 Exhibit 99.1

EXHIBIT 99.1

Occidental Petroleum Corporation

Sanford C. Bernstein Co., Inc.

23rd Annual Strategic Decisions Conference 2007

1

Dr. Ray R. Irani

Chairman, President and Chief Executive Officer

2

3

4

1999 - 2006 Profitability

8-Year Average

($/Barrel of Oil
Equivalent)

12.11

OXY

10.25

APA

9.31

APC

9.28

ECA

9.00

COP

8.58

CVX

8.06

XOM

7.98

MRO

7.90

BP

7.78

DVN

4.98

HES

For GAAP Reconciliation – see www.oxy.com

5

1999 - 2006 Free Cash Flow

8-Year Average

($/Barrel of Oil
Equivalent)

11.17

OXY

7.17

MRO

7.01

COP

6.60

CVX

6.48

XOM

5.89

BP

4.61

APA

4.36

DVN

4.35

HES

2.56

APC

0.05

ECA

For GAAP Reconciliation – see www.oxy.com

6

Cash From Operations

$ Millions

2,100

2002

3,074

2003

3,878

2004

5,337

2005

6,353

2006

7

Debt-to-Capitalization Ratio

Percentage

43

2002

37

2003

27

2004

17

2005

13

2006

10

3/2007

For GAAP Reconciliation – see www.oxy.com

8

Chemicals Profit Margins

2006 Operating Profits

as Percent of Sales

OxyChem  18.7

4.7

7.8

9.6

12.6

4.9

6.4

9.0

7.1

11.5

14.0

13.4

13.0

For GAAP Reconciliation – see www.oxy.com

9

Recent Transactions

BP and Anadarko transactions strengthen
Oxy’s industry-leading Permian position and
core position in Qatar

Oxy exits non-core, non-operated properties

Sale of remaining Lyondell shares completes
Oxy’s exit from petrochemicals

10

Worldwide Oil and Gas

California

Kansas/Oklahoma

Texas/New Mexico

Colombia

Argentina

Libya

Qatar

UAE

Oman

Yemen

Oxy Areas

11

2007 Production Outlook

Latin

America

13%

Permian

34%

Middle East/

North Africa

24%

California

24%

Other

U.S.

5%

U.S. Production 63%

12

U.S. Operations

California

Colorado

Kansas

New

Mexico

Oklahoma

Texas

2007 net production outlook

370,000 equivalent barrels/day

63% of worldwide total

Oxy Blocks

13

California Operations

Elk Hills

Los Angeles

THUMS

2007 net production
outlook

140,000 equivalent
barrels/day

24% of worldwide total

14

Texas and New Mexico Operations

New

Mexico

Oklahoma

Texas

Permian

Basin

2007 net production outlook

200,000 equivalent barrels/day

34% of worldwide total

Oxy Blocks

15

Argentina Operations

Brazil

Cuyo Basin

Uruguay

Neuquen Basin

Argentina

San Jorge Basin

Oxy Blocks

2007 net production outlook

40,000 equivalent
barrels/day

Identified 700 drilling sites

Drill 190 new wells in 2007

2011 net production target

70,000 barrels/day

16

Middle East and North Africa Operations

Libya

Qatar

UAE

2007 net production outlook

140,000 equivalent barrels/day

24% of worldwide total

17

UAE / Qatar – Dolphin Project

Oxy’s interest is 24.5%

Project Status

300 mmcf/d of third-party
supplied gas currently moving
through pipeline to markets in
Dubai.

We expect first Dolphin gas to
the plant in June with gas
flowing to UAE markets in July.

Ramp up production toward 2
bcf/day by year-end

At full-scale production in 2008,
Oxy’s net share expected to
average 60,000 BOE/day.  

18

Oman – Mukhaizna Project

Project Overview

Gross Capital – $3.8 Billion

1800+ wells

Central processing facility

Water treatment plant

Steam generation facilities

Pipelines

Increase gross production
to150,000 barrels/day

2007 Work Program

$400 – $450 MM (net to Oxy)

Drill approximately 120 wells

Steam injection continues

Arabian Gulf

Gulf of
Oman

Muscat

Block 9

Block 27

Saudi Arabia

Oman

Mukhaizna
Field

Block 54

Yemen

Salalah

Arabian Sea

Oxy Blocks

19

Libya Update 2007

Mediterranean Sea

Tunisia

Tripoli

Benghazi

Egypt

Libya

Algeria

Niger

Chad

Sudan

Oxy Blocks

Oxy acreage position

30 million acres

2007 net production

20,000 equivalent
barrels/day

2007 exploration

Drill 14-16 wells

10-12 onshore

4 offshore

20

Five Year Production Growth (Through 2010)

Base production growth (7% - 9%)

After asset sale adjustments

Current projects

Dolphin

Mukhaizna

Argentina

Additional production growth

New EOR / development projects

21

Looking Ahead

Oxy has attractive growth opportunities in
addition to our production outlook

Oxy has high-quality legacy assets in Texas,
California and the Middle East

Oxy generates top quartile returns on capital

Oxy generates significant cash flow

22

Occidental Petroleum Corporation

Statements in this presentation that contain words such as "will," "expect"
or "estimate," or otherwise relate to the future, are forward-looking and
involve risks and uncertainties that could significantly affect expected
results.  Factors that could cause results to differ materially include, but
are not limited to: exploration risks such as drilling of unsuccessful wells,
global commodity pricing fluctuations and supply/demand considerations
for oil, gas and chemicals; higher than expected costs; political risks;
changes in tax rates; unrealized acquisition benefits or higher than
expected integration costs; and not successfully completing (or any
material delay in) any expansion, capital expenditure, acquisition or
disposition.  You should not place undue reliance on these forward-looking
statements which speak only as of the date of this presentation.  Unless
legally required, Occidental does not undertake any obligation to update
any forward-looking statements as a result of new information, future
events or otherwise. The United States Securities and Exchange
Commission (SEC) permits oil and natural gas companies, in their filings
with the SEC, to disclose only proved reserves demonstrated by actual
production or conclusive formation tests to be economically producible
under existing economic and operating conditions.  We use certain terms
in this presentation, such as estimated proved reserves, probable,
possible and recoverable reserves and oil in place, that the SEC's
guidelines strictly prohibit us from using in filings with the SEC. U.S
investors are urged to consider carefully the disclosure in our Form 10-K,
available through 1-888-699-7383 or at www.oxy.com.  You also can
obtain a copy from the SEC by calling 1-800-SEC-0330.

23

Oil & Gas: Profitability

Reconciliation to Generally Accepted Accounting Principles (GAAP)

( Millions, except $/BOE)

Average For the Eight Years Ended December 31, 1999 - 2006

 

 

1999

2000

2001

2002

2003

2004

2005

2006

 

8-Year

Average

Revenues

 

$

2,503

 

3,990

 

5,019

 

4,461

 

5,875

 

7,500

 

10,355

$

12,479

 

$

6,523

Production costs

 

 

452

 

785

 

1,031

 

1,064

 

1,225

 

1,497

 

1,927

 

2,514

 

 

1,312

Exploration expenses

 

 

75

 

94

 

184

 

176

 

138

 

215

 

335

 

296

 

 

189

Other operating expenses

 

 

170

 

215

 

215

 

222

 

344

 

398

 

502

 

608

 

 

334

DD&A

 

 

598

 

661

 

739

 

819

 

971

 

1,052

 

1,224

 

1,771

 

 

979

Pre-tax income

 

 

1,208

 

2,235

 

2,850

 

2,180

 

3,197

 

4,338

 

6,367

 

7,290

 

 

3,708

Income tax expense

 

 

366

 

1,051

 

1,006

 

718

 

1,129

 

1,507

 

2,341

 

2,922

 

 

1,380

Results of operations

 

$

842

$

1,184

$

1,844

$

1,462

$

2,068

$

2,831

$

4,026

$

4,368

 

$

2,328

BOE Sales

 

 

156

 

174

 

181

 

192

 

202

 

207

 

207

 

219

 

 

192

Revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

33.94

Production costs

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

6.83

Exploration expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

0.98

Other operating expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1.74

DD&A

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

5.10

Pre-tax income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

19.29

Income tax expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

7.18

Results of operations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

12.11

Oil & Gas: Cash Flow

Reconciliation to Generally Accepted Accounting Principles (GAAP)

( Millions, except $/BOE)

Average For the Eight Years Ended December 31, 1999 - 2006

 

 

1999

2000

2001

2002

2003

2004

2005

2006

 

8-Year

Average

Occidental Petroleum Consolidated Statement of Cash Flows

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash flow from operating activities

 

 

1,004

 

 

2,348

 

 

2,566

 

 

2,100

 

 

3,074

 

 

3,878

 

 

5,337

 

 

6,353

 

 

 

 

 

Cash flow from investing activities

 

 

1,632

 

 

(3,044

)

 

(651

)

 

(1,696

)

 

(2,131

)

 

(2,428

)

 

(3,161

)

 

(4,383

)

 

 

 

 

Cash flow from financing activities

 

 

(2,517

)

 

579

 

 

(1,814

)

 

(461

)

 

(513

)

 

(821

)

 

(1,187

)

 

(2,819

)

 

 

 

 

Change in cash

 

$

119

 

$

(117

)

$

101

 

$

(57

)

$

430

 

$

629

 

$

989

 

$

(849

)

 

 

 

 

FAS 69 GAAP Oil & Gas results of operations

 

$

842

 

$

1,184

 

$

1,844

 

$

1,462

 

$

2,068

 

$

2,831

 

$

4,026

 

$

4,368

 

 

$

2,328

 

Depreciation, depletion & amortization

 

 

598

 

 

661

 

 

739

 

 

819

 

 

971

 

 

1,052

 

 

1,224

 

 

1,771

 

 

 

979

 

Exploration expense

 

 

75

 

 

94

 

 

184

 

 

176

 

 

138

 

 

215

 

 

335

 

 

296

 

 

 

189

 

Capital expenditures (excluding acquisitions)

 

 

(405

)

 

(713

)

 

(1,089

)

 

(930

)

 

(1,127

)

 

(1,607

)

 

(2,190

)

 

(2,742

)

 

 

(1,350

)

Cash flow from operations

 

$

1,110

 

$

1,226

 

$

1,678

 

$

1,527

 

$

2,050

 

$

2,491

 

$

3,395

 

$

3,693

 

 

$

2,146

 

BOE Sales

 

 

156

 

 

174

 

 

181

 

 

192

 

 

202

 

 

207

 

 

207

 

 

219

 

 

 

192

 

Cash flow per BOE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

11.17

 

The computation of cash flow per BOE included in the denominator 2.1 mmboe, 4.2 mmboe, 7.8 mmboe and 5.7 mmboe produced by Occidental that were subject to volumetric production payments for the years 2003, 2002, 2001 and 2000, respectively.

Occidental Petroleum Corporation

Reconciliation to Generally Accepted Accounting Principles (GAAP)

Debt / Capitalization Ratio

Expressed in $ Millions except Ratios

Current Maturities

 

31-Dec-02

 

31-Dec-03

 

31-Dec-04

 

31-Dec-05

 

31-Dec-06

 

31-Mar-07

Long-term debt

 

206

 

 

23

 

 

459

 

 

46

 

 

171

 

 

449

 

Trust preferred securities

 

-

 

 

453

 

 

-

 

 

-

 

 

-

 

 

-

 

 

 

206

 

 

476

 

 

459

 

 

46

 

 

171

 

 

449

 

Non-current Debt

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Long-term debt

 

4,005

 

 

4,000

 

 

3,351

 

 

2,877

 

 

2,621

 

 

1,692

 

Unamortized debt discount

 

(8

)

 

(7

)

 

(6

)

 

(4

)

 

(2

)

 

(1

)

 

 

3,997

 

 

3,993

 

 

3,345

 

 

2,873

 

 

2,619

 

 

1,691

 

Capital lease obligations

 

26

 

 

26

 

 

26

 

 

25

 

 

25

 

 

25

 

Subsidiary preferred stock

 

75

 

 

75

 

 

75

 

 

75

 

 

75

 

 

75

 

Trust preferred securities

 

455

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

DEBT

 

4,759

 

 

4,570

 

 

3,905

 

 

3,019

 

 

2,890

 

 

2,240

 

Capitalization

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Debt (above)

 

4,759

 

 

4,570

 

 

3,905

 

 

3,019

 

 

2,890

 

 

2,240

 

Equity

 

6,318

 

 

7,970

 

 

10,597

 

 

15,091

 

 

19,252

 

 

20,217

 

CAPITALIZATION

 

11,077

 

 

12,540

 

 

14,502

 

 

18,110

 

 

22,142

 

 

22,457

 

RATIO

 

43%

 

37%

 

27%

 

17%

 

13%

 

10%

Chemical - Percent of Sales

Reconciliation to Generally Accepted Accounting Principles (GAAP)

For the Year Ended December 31, 2006

Amounts in $ Millions Except % of Sales

Sales

 

 

 

 

Oil and Gas

 

12,676

 

 

Chemical

 

4,815

 

 

Other

 

170

 

 

 

 

17,661

 

 

Chemicals

 

$ AMT

 

% of Sales

Segment income

 

901

 

 

Less: significant items affecting earnings

 

 

 

 

None

 

-

 

 

Core results

 

901

 

18.7%