EXHIBIT 99.1
For Immediate Release: February 13, 2009
Occidental Replaces 210 Percent of 2008 Production
LOS ANGELES, February 13, 2009 -- Occidental Petroleum Corporation (NYSE: OXY) announced today that at year-end 2008, the company's preliminary worldwide proved reserves, on a consolidated basis, totaled 2.98 billion barrels of oil equivalent (BOE) compared to 2.87 billion BOE at the end of 2007. In 2008, the company's consolidated subsidiaries had proved reserve additions from all sources, before the effect of price-related revisions, of 463 million BOE, compared to production of 221 million BOE, for a production replacement ratio of 210 percent. At the end of 2008, Occidental's consolidated reserves-to-production ratio, assuming production remained at the 2008 level, was 13.5 years.
Excluding purchases of proved reserves and the effect of price revisions, the company added 253 million BOE of proved reserves on a consolidated basis, of which improved recovery provided 98 percent and extensions and discoveries provided 9 percent, partially offset by non-price-related negative revisions of 7 percent.
These additions were partially offset by negative revisions of 127 million BOE that were attributable to the difference between prices of oil and gas at year-end 2007 and year-end 2008. Negative domestic price revisions were partially offset by positive price revisions in the Middle East/North Africa, as a result of the impact of Production Sharing Contracts.
Occidental's costs for exploration and development activities were $4.4 billion. Additionally, Occidental incurred $3.5 billion in property acquisition costs. All of the acquisitions were domestic, mainly in the Rocky Mountains and the Permian Basin.
In 2008, proved developed reserves were 74 percent of total proved reserves. For the three-year period 2006 through 2008, Occidental's consolidated proved reserve additions totaled 1.1 billion BOE, and total production equaled 630 million BOE, for a reserve replacement ratio of 173 percent.
2008 RECAP
| Reserve |
| Costs | |||||
| Additions |
| Incurred | |||||
| (Million BOE) |
| ($ Millions) | |||||
|
|
|
|
|
|
|
|
|
Additions |
| 271 |
|
|
| $ | 4,441 |
|
|
|
|
|
|
|
|
|
|
Less: Physical Revisions |
| (18 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Additions |
| 253 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchase of Proved Reserves |
| 210 |
|
|
|
| 3,541 |
|
|
|
|
|
|
|
|
|
|
Additions from All Sources |
| 463 |
|
|
| $ | 7,982 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production |
| (221 | ) |
|
|
|
|
|
Sales of Proved Reserves |
| (3 | ) |
|
|
|
|
|
Price Revisions |
| (127 | ) |
|
|
|
|
|
About Oxy
Occidental Petroleum Corporation is an international oil and gas exploration and production company with operations in the United States, Middle East/North Africa and Latin America regions. Oxy is the fourth largest U.S. oil and gas company, based on equity market capitalization. Oxy's wholly owned subsidiary, OxyChem, manufactures and markets chlor-alkali products and vinyls. Occidental is committed to safeguarding the environment, protecting the safety and health of employees and neighboring communities and upholding high standards of social responsibility in all of the company's worldwide operations.
-0-
Contacts: | Richard S. Kline (media) |
| richard_kline@oxy.com |
| 310-443-6249 |
|
|
| Chris Stavros (investors) |
| chris_stavros@oxy.com |
| 212-603-8184 |
|
|
| On the web: www.oxy.com |
2
OIL AND GAS PRELIMINARY RESERVES
(Consolidated Subsidiaries)
The following table sets forth Occidental's net interests in quantities of proved developed and undeveloped reserves of crude oil, natural gas liquids (NGLs), condensate and natural gas and changes in such quantities. Crude oil reserves (in millions of barrels) include condensate and NGLs. Natural gas volumes (in billion cubic feet) have been converted to barrels of oil equivalent (BOE) based on energy content of 6,000 cubic feet of gas to one barrel of oil.
|
| United |
| Latin |
| Middle East/ |
| Total |
| ||||||
|
| States |
| America |
| No. Africa |
| Million |
| ||||||
|
| Oil |
| Gas |
| Oil |
| Gas |
| Oil |
| Gas |
| BOE (b) |
|
PROVED DEVELOPED AND |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
UNDEVELOPED RESERVES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2005 |
| 1,616 |
| 2,323 |
| 50 |
| — |
| 296 |
| 1,051 |
| 2,524 |
|
Revisions of |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
previous estimates |
| (28 | ) | (135 | ) | 10 |
| 45 |
| 39 |
| 59 |
| 16 |
|
Improved recovery |
| 69 |
| 120 |
| 33 |
| — |
| 14 |
| 7 |
| 137 |
|
Extensions and |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
discoveries |
| 3 |
| 58 |
| 7 |
| — |
| 14 |
| — |
| 34 |
|
Purchases of proved |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
reserves |
| 98 |
| 274 |
| 152 |
| 161 |
| 4 |
| — |
| 326 |
|
Sales of proved |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
reserves |
| (4 | ) | (2 | ) | — |
| — |
| — |
| — |
| (4 | ) |
Production |
| (94 | ) | (214 | ) | (26 | ) | (12 | ) | (40 | ) | (11 | ) | (200 | ) |
Balance at |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2006 |
| 1,660 |
| 2,424 |
| 226 |
| 194 |
| 327 |
| 1,106 |
| 2,833 |
|
Revisions of |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
previous estimates |
| (20 | ) | 35 |
| (17 | ) | 5 |
| (43 | ) | (130 | ) | (95 | ) |
Improved recovery |
| 114 |
| 406 |
| 17 |
| 5 |
| 52 |
| 6 |
| 253 |
|
Extensions and |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
discoveries |
| 1 |
| 5 |
| 15 |
| 19 |
| 2 |
| 11 |
| 24 |
|
Purchases of proved |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
reserves |
| 47 |
| 18 |
| — |
| — |
| 10 |
| — |
| 60 |
|
Sales of proved |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
reserves |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
|
Production |
| (95 | ) | (216 | ) | (27 | ) | (15 | ) | (43 | ) | (30 | ) | (209 | ) |
Balance at |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2007 |
| 1,707 |
| 2,672 |
| 214 |
| 208 |
| 305 |
| 963 |
| 2,866 |
|
Revisions of |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
previous estimates |
| (243 | ) | (490 | ) | (6 | ) | (26 | ) | 135 |
| 328 |
| (145 | ) |
Improved recovery |
| 99 |
| 281 |
| 44 |
| 46 |
| 46 |
| 21 |
| 247 |
|
Extensions and |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
discoveries |
| 11 |
| 76 |
| — |
| — |
| — |
| — |
| 24 |
|
Purchases of proved |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
reserves |
| 71 |
| 832 |
| — |
| — |
| — |
| — |
| 210 |
|
Sales of proved |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
reserves |
| (2 | ) | (3 | ) | — |
| — |
| — |
| — |
| (3 | ) |
Production |
| (96 | ) | (215 | ) | (28 | ) | (16 | ) | (46 | ) | (76 | ) | (221 | ) |
Balance at |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2008 |
| 1,547 |
| 3,153 |
| 224 |
| 212 |
| 440 |
| 1,236 |
| 2,978 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3
OIL AND GAS PRELIMINARY RESERVES (continued)
(Consolidated Subsidiaries)
|
| United |
| Latin |
| Middle East/ |
| Total |
| ||||||
|
| States |
| America |
| No. Africa |
| Million |
| ||||||
|
| Oil |
| Gas |
| Oil |
| Gas |
| Oil |
| Gas |
| BOE (b) |
|
PROVED DEVELOPED |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RESERVES (a) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2005 |
| 1,319 |
| 1,833 |
| 44 |
| — |
| 174 |
| 73 |
| 1,855 |
|
December 31, 2006 |
| 1,382 |
| 1,940 |
| 140 |
| 137 |
| 249 |
| 560 |
| 2,211 |
|
December 31, 2007 |
| 1,406 |
| 1,997 |
| 120 |
| 140 |
| 262 |
| 932 |
| 2,300 |
|
December 31, 2008 |
| 1,209 |
| 1,866 |
| 124 |
| 142 |
| 342 |
| 1,206 |
| 2,211 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Approximately one percent of the proved developed oil reserves and approximately three percent of the proved developed gas reserves at December 31, 2008 are non-producing.
(b) Excludes other interests, which include the minority interest in a Colombian subsidiary, partially offset by Occidental's share of reserves from an equity investee in Yemen. Other interests have total proved reserves of (1) million BOE and proved developed reserves of (2) million BOE at December 31, 2008.
4
PRELIMINARY COSTS INCURRED
(Consolidated Subsidiaries)
Occidental's 2008, 2007 and 2006 costs incurred in oil and gas property acquisition, exploration and development activities, whether capitalized or expensed, were as follows:
|
| United |
| Latin |
| Middle East/ |
|
|
|
| |||
|
| States |
| America |
| No. Africa |
| Total (b) |
| ||||
FOR THE YEAR ENDED |
|
|
|
|
|
|
|
|
|
|
|
|
|
DECEMBER 31, 2008 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Property Acquisition |
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs |
|
|
|
|
|
|
|
|
|
|
|
|
|
Proved Properties |
| $ | 1,819 |
| $ | 8 |
| $ | 4 |
| $ | 1,831 |
|
Unproved Properties |
|
| 1,362 |
|
| — |
|
| 348 |
|
| 1,710 |
|
Exploration Costs |
|
| 130 |
|
| 96 |
|
| 115 |
|
| 341 |
|
Development Costs |
|
| 1,740 |
|
| 864 |
|
| 1,496 |
|
| 4,100 |
|
Costs Incurred |
| $ | 5,051 |
| $ | 968 |
| $ | 1,963 |
| $ | 7,982 |
|
FOR THE YEAR ENDED |
|
|
|
|
|
|
|
|
|
|
|
|
|
DECEMBER 31, 2007 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Property Acquisition |
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs |
|
|
|
|
|
|
|
|
|
|
|
|
|
Proved Properties |
| $ | 626 |
| $ | — |
| $ | 300 |
| $ | 926 |
|
Unproved Properties |
|
| 167 |
|
| (58 | ) |
| 10 |
|
| 119 |
|
Exploration Costs |
|
| 39 |
|
| 79 |
|
| 213 |
|
| 331 |
|
Development Costs |
|
| 1,268 |
|
| 524 |
|
| 1,032 |
|
| 2,824 |
|
Costs Incurred |
| $ | 2,100 |
| $ | 545 |
| $ | 1,555 |
| $ | 4,200 |
|
FOR THE YEAR ENDED |
|
|
|
|
|
|
|
|
|
|
|
|
|
DECEMBER 31, 2006 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Property Acquisition |
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs (a) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Proved Properties |
| $ | 2,083 |
| $ | 2,408 |
| $ | 397 |
| $ | 4,888 |
|
Unproved Properties |
|
| 377 |
|
| 655 |
|
| 110 |
|
| 1,142 |
|
Exploration Costs |
|
| 39 |
|
| 61 |
|
| 213 |
|
| 313 |
|
Development Costs |
|
| 1,330 |
|
| 320 |
|
| 792 |
|
| 2,442 |
|
Costs Incurred |
| $ | 3,829 |
| $ | 3,444 |
| $ | 1,512 |
| $ | 8,785 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Includes acquisition costs and related step-up for deferred income taxes of $1.34 billion for the purchase of Vintage Petroleum Inc. There was no goodwill recorded for this acquisition.
(b) Excludes costs incurred for other interests totaling $4 million in 2008.
5
PRELIMINARY 5-YEAR DATA
CONSOLIDATED SUBSIDIARIES
|
| Reserve |
|
|
|
| Costs | ||
|
| Additions |
| Production |
| Incurred | |||
|
| (Million BOE) |
| (Million BOE) |
| ($ Millions) | |||
2004 |
| 241 |
|
| 166 |
|
| 1,662 |
|
2005 |
| 370 |
|
| 171 |
|
| 4,185 |
|
2006 |
| 513 |
|
| 200 |
|
| 8,785 | * |
2007 |
| 242 |
|
| 209 |
|
| 4,200 |
|
2008 |
| 336 |
|
| 221 |
|
| 7,982 |
|
3-Year |
|
|
|
|
|
|
|
|
|
Average |
| 363 |
|
| 210 |
|
| 6,990 |
|
5-Year |
|
|
|
|
|
|
|
|
|
Average |
| 340 |
|
| 193 |
|
| 5,363 |
|
Reserves Replacement
(Million BOE)
|
|
|
|
| Improved |
| Extensions |
|
|
|
|
|
| ||
|
| Revisions |
| Recovery |
| Discoveries |
| Acquisitions |
| Total | |||||
2004 |
| 50 |
|
| 110 |
|
| 41 |
|
| 40 |
|
| 241 |
|
2005 |
| (15 | ) |
| 129 |
|
| 117 |
|
| 139 |
|
| 370 |
|
2006 |
| 16 |
|
| 137 |
|
| 34 |
|
| 326 |
|
| 513 |
|
2007 |
| (95 | ) |
| 253 |
|
| 24 |
|
| 60 |
|
| 242 |
|
2008 |
| (145 | ) |
| 247 |
|
| 24 |
|
| 210 |
|
| 336 |
|
3-Year |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average |
| (75 | ) |
| 212 |
|
| 27 |
|
| 199 |
|
| 363 |
|
5-Year |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average |
| (38 | ) |
| 175 |
|
| 48 |
|
| 155 |
|
| 340 |
|
Costs Incurred
($ Millions)
|
|
|
|
| Exploration |
| Development |
|
|
| ||
|
| Acquisitions |
| Costs |
| Costs |
| Total | ||||
2004 |
| 166 |
|
| 132 |
|
| 1,364 |
|
| 1,662 |
|
2005 |
| 2,166 |
|
| 232 |
|
| 1,787 |
|
| 4,185 |
|
2006 |
| 6,030 |
|
| 313 |
|
| 2,442 |
|
| 8,785 | * |
2007 |
| 1,045 |
|
| 331 |
|
| 2,824 |
|
| 4,200 |
|
2008 |
| 3,541 |
|
| 341 |
|
| 4,100 |
|
| 7,982 |
|
3-Year |
|
|
|
|
|
|
|
|
|
|
|
|
Average |
| 3,539 |
|
| 328 |
|
| 3,122 |
|
| 6,990 |
|
5-Year |
|
|
|
|
|
|
|
|
|
|
|
|
Average |
| 2,590 |
|
| 270 |
|
| 2,503 |
|
| 5,363 |
|
*Includes acquisition costs and related step-up for deferred income taxes of $1.34 billion for the purchase of Vintage Petroleum Inc. There was no goodwill recorded for this acquisition.
6