Occidental Petroleum (OXY) 10-Q 6 Aug 09 2009 Q2 Quarterly report Financial data

CONSOLIDATED CONDENSED BALANCE

CONSOLIDATED CONDENSED BALANCE SHEETS (USD $)
In Millions	Jun. 30, 2009	Dec. 31, 2008
CURRENT ASSETS
Cash and cash equivalents	$1,755	$1,777
Trade receivables, net	2,776	3,117
Marketing and trading assets and other	749	1,012
Inventories	1,069	958
Prepaid expenses and other	309	308
Total current assets	6,658	7,172
INVESTMENTS IN UNCONSOLIDATED ENTITIES	1,350	1,263
PROPERTY, PLANT AND EQUIPMENT, net of accumulated depreciation, depletion and amortization of $17,897 at June 30, 2009 and $16,462 at December 31, 2008	32,909	32,266
LONG-TERM RECEIVABLES AND OTHER ASSETS, NET	918	836
TOTAL ASSETS	41,835	41,537
CURRENT LIABILITIES
Current maturities of long-term debt and notes payable	918	698
Accounts payable	2,574	3,306
Accrued liabilities	1,700	1,861
Domestic and foreign income taxes	110	158
Liabilities of discontinued operations	109	111
Total current liabilities	5,411	6,134
LONG-TERM DEBT, NET	2,567	2,049
DEFERRED CREDITS AND OTHER LIABILITIES
Deferred and other domestic and foreign income taxes	2,714	2,660
Long-term liabilities of discontinued operations	145	152
Other	3,111	3,217
TOTAL DEFERRED CREDITS AND OTHER LIABILITIES	5,970	6,029
STOCKHOLDERS' EQUITY
Common stock, at par value	176	176
Treasury stock	(4,130)	(4,121)
Additional paid-in capital	7,164	7,113
Retained earnings	25,206	24,684
Accumulated other comprehensive loss	(590)	(552)
Noncontrolling interest	61	25
TOTAL STOCKHOLDERS' EQUITY	27,887	27,325
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$41,835	$41,537

1_CONSOLIDATED CONDENSED BALANC

CONSOLIDATED CONDENSED BALANCE SHEETS (parenthetical) (USD $)
In Millions	Jun. 30, 2009	Dec. 31, 2008
CONSOLIDATED CONDENSED BALANCE SHEETS
Accumulated depreciation, depletion and amortization	$17,897	$16,462

CONSOLIDATED CONDENSED STATEMEN

CONSOLIDATED CONDENSED STATEMENTS OF INCOME (USD $)
In Millions, except Per Share data	3 Months Ended Jun. 30, 2009	3 Months Ended Jun. 30, 2008	6 Months Ended Jun. 30, 2009	6 Months Ended Jun. 30, 2008
REVENUES AND OTHER INCOME
Net sales	$3,687	$7,116	$6,760	$13,136
Interest, dividends and other income	28	73	58	133
Gains on disposition of assets, net	7	31	7	25
TOTAL REVENUES AND OTHER INCOME	3,722	7,220	6,825	13,294
COSTS AND OTHER DEDUCTIONS
Cost of sales	2,059	2,610	4,123	5,020
Selling, general and administrative and other operating expenses	362	380	632	699
Taxes other than on income	110	171	215	304
Environmental remediation	0	26	0	30
Exploration expense	54	58	112	132
Interest and debt expense, net	32	32	59	70
TOTAL COSTS AND OTHER DEDUCTIONS	2,617	3,277	5,141	6,255
Income before taxes and other items	1,105	3,943	1,684	7,039
Provision for domestic and foreign income taxes	455	1,671	696	2,965
Income from equity investments	(46)	(65)	(88)	(111)
Income from continuing operations	696	2,337	1,076	4,185
Discontinued operations, net	(2)	(3)	(5)	24
Net Income	694	2,334	1,071	4,209
Less: Net income attributable to noncontrolling interest	(12)	(37)	(21)	(66)
NET INCOME ATTRIBUTABLE TO COMMON STOCK	$682	$2,297	$1,050	$4,143
BASIC EARNINGS PER COMMON SHARE - ATTRIBUTABLE TO COMMON STOCK
Income from continuing operations (in dollars per share)	0.84	2.79	1.3	$5
Discontinued operations, net (in dollars per share)	$0	$0	-0.01	0.03
BASIC EARNINGS PER COMMON SHARE (in dollars per share)	0.84	2.79	1.29	5.03
DILUTED EARNINGS PER COMMON SHARE - ATTRIBUTABLE TO COMMON STOCK
Income from continuing operations (in dollars per share)	0.84	2.78	1.3	4.97
Discontinued operations, net (in dollars per share)	$0	$0	-0.01	0.03
DILUTED EARNINGS PER COMMON SHARE (in dollars per share)	0.84	2.78	1.29	$5
DIVIDENDS PER COMMON SHARE (in dollars per share)	0.33	0.32	0.65	0.57

2_CONSOLIDATED CONDENSED STATEM

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (USD $)
In Millions	6 Months Ended Jun. 30, 2009	6 Months Ended Jun. 30, 2008
CASH FLOW FROM OPERATING ACTIVITES
Net income	$1,071	$4,209
Adjustments to reconcile net income to net cash provided by operating activities:
Discontinued operations, net	5	(24)
Depreciation, depletion and amortization expense	1,528	1,274
Deferred income tax provision	128	148
Other non-cash charges to income	205	312
Gains on disposition of assets, net	(7)	(25)
Income from equity investments	(88)	(111)
Dry hole and impairment expense	90	96
Changes in operating assets and liabilities	(555)	(663)
Other operating, net	(154)	(234)
Operating cash flow from continuing operations	2,223	4,982
Operating cash flow from discontinued operations	(22)	49
Net cash provided by operating activities	2,201	5,031
CASH FLOW FROM INVESTING ACTIVITIES
Capital expenditures	(1,902)	(1,871)
Purchases of businesses and assets, net	(534)	(2,360)
Sales of assets, net	45	8
Sales of investments	0	51
Equity investments and other investing, net	(51)	(38)
Net cash used by investing activities	(2,442)	(4,210)
CASH FLOW FROM FINANCING ACTIVITIES
Proceeds from long-term debt	740	51
Payments of long-term debt	(8)	(67)
Proceeds from issuance of common stock	13	5
Purchases of treasury stock	(9)	(860)
Excess tax benefits related to share-based payments	4	58
Cash dividends paid	(520)	(413)
Stock options exercised	1	9
Distributions to noncontrolling interest	(2)	(62)
Net cash provided (used) by financing activities	219	(1,279)
Decrease in cash and cash equivalents	(22)	(458)
Cash and cash equivalents-beginning of period	1,777	1,964
Cash and cash equivalents-end of period	$1,755	$1,506

General

General
	6 Months Ended Jun. 30, 2009 USD / shares
Notes to Consolidated Condensed Financial Statements
General	1. General In these unaudited consolidated condensed financial statements, Occidental means Occidental Petroleum Corporation, a Delaware corporation (OPC), and/or one or more entities in which it owns a majority voting interest (subsidiaries). Occidental has made its disclosures in accordance with accounting principles generally accepted in the United States of America as they apply to interim reporting, and condensed or omitted, as permitted by the Securities and Exchange Commissions rulesand regulations, certain information and disclosures normally included in consolidated financial statements and the notes. The consolidated condensed financial statements should be read in conjunction with the consolidated financial statements and the notes thereto in Occidentals Annual Report on Form10-K for the year ended December31, 2008. In the opinion of Occidentals management, the accompanying consolidated condensed financial statements contain all adjustments (consisting of normal recurring adjustments) necessary to fairly present Occidentals consolidated financial position as of June30, 2009, and the consolidated statements of income and cash flows for the three and six months ended June30, 2009 and 2008, as applicable. The income and cash flows for the periods ended June30, 2009 and 2008, are not necessarily indicative of the income or cash flows to be expected for the full year. Except as noted in Note 14, Occidentals management has evaluated events from July1, 2009 through August6, 2009 and has noted no events occurring during that period which should be recognized or disclosed in these financial statements in accordance with generally accepted accounting principles.

Asset Acquisitions, Disposition

Asset Acquisitions, Dispositions and Other Transactions
	6 Months Ended Jun. 30, 2009 USD / shares
Notes to Consolidated Condensed Financial Statements
Asset Acquisitions, Dispositions and Other Transactions	2. Asset Acquisitions, Dispositions and Other Transactions In May2009, Occidental issued $750 million of 4.125-percent senior unsecured notes, receiving $740 million of net proceeds. Interest on the notes will be payable semi-annually in arrears on June1 and December1 of each year. The notes will mature on June1, 2016. In April2009, Occidental and its partner signed a Development and Production Sharing Agreement (DPSA) with the National Oil and Gas Authority of Bahrain for further development of the Bahrain Field. Under this agreement, a Joint Operating Company will be formed to serve as operator for the project under the DPSA.

Accounting Changes

Accounting Changes
	6 Months Ended Jun. 30, 2009 USD / shares
Notes to Consolidated Condensed Financial Statements
Accounting Changes	3. Accounting Changes In May2009, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards (SFAS) No.165, which provides new disclosure requirements for the Companys evaluation of subsequent events. This statement is effective for periods ending after June15, 2009. Occidental adopted this statement in the quarter ended June30, 2009 and included appropriate disclosures. In April2009, the FASB issued FASB Staff Position (FSP) No.FAS 107-1 and APB 28-1, which provides new disclosure requirements for the fair value of financial instruments in interim periods when it is practicable to estimate. This FSP is effective for interim and annual periods ending after June15, 2009. Occidental adopted this FSP in the quarter ended June30, 2009 and included appropriate disclosures. In June2008, the FASB issued FSP EITF 03-6-1. This FSP concluded that instruments containing rights to nonforfeitable dividends granted in share-based payment transactions are participating securities prior to vesting and, therefore, should be included in the earnings allocations in computing basic earnings per share (EPS) under the two-class method. This FSP is effective for financial statements issued for fiscal years beginning after December15, 2008, with prior period retrospective application. Occidental adopted this FSP on January1, 2009, which had no material impact on Occidentals financial statements. In March2008, the FASB issued SFAS No.161, which provides new disclosure requirements for an entitys derivative and hedging activities. This statement is effective for periods beginning after November15, 2008. Occidental adopted this statement on January1, 2009 and included appropriate disclosures. In February2008, the FASB issued FSP FAS 157-2, which deferred the effective date for applying the fair value measurement and disclosure framework of SFAS No.157 to non-financial assets and liabilities that are recorded at fair value on a non-recurring basis until periods beginning after November15, 2008. Occidental adopted this deferred portion of SFAS No.157 on January1, 2009, on a prospective basis, which had no material impact on Occidentals financial statements upon adoption. In December2007, the FASB issued SFAS No.141(R). This statement provides new accounting guidance and disclosure requirements for business combinations, and is effective for business combinations which occur starting with the first fiscal year beginning on or after December15, 2008. In April2009, the FASB issued FSP FAS 141(R)-1, effective beginning the first quarter of 2009, which amends and clarifies certain provisions of SFAS 141(R), including the initial recognition and measurement criteria, subsequent measurement and accounting, and disclosure of preacquisition contingencies in business combinations. Occidental adopted SFAS 141(R)and FSP FAS 141(R)-1 in the first quarter of 2009, which had no material impact on Occidentals financial statements upon adoption. In December2007, the FASB issued SFAS No.160. This statement provides new accounting guidance and disclosure and presentation requirements for noncontrolling interests in a subsid

Comprehensive Income

Comprehensive Income
	6 Months Ended Jun. 30, 2009 USD / shares
Notes to Consolidated Condensed Financial Statements
Comprehensive Income	4. Comprehensive Income The following table presents Occidentals comprehensive income for the three and six months ended June30, 2009 and 2008 (in millions): Periods Ended June30 Three months Six months 2009 2008 2009 2008 Net income attributable to common stock $ 682 $ 2,297 $ 1,050 $ 4,143 Other comprehensive income (loss) items Foreign currency translation adjustments 17 9 18 11 Unrealized losses on derivatives (81 ) (447 ) (46 ) (563 ) Pension and post-retirement adjustments 6 2 12 (10 ) Reclassification of realized losses (gains) on derivatives 12 63 (22 ) 84 Unrealized gains on securities 4 16 Realized losses on securities (16 ) (16 ) Other comprehensive loss, net of tax (46 ) (385 ) (38 ) (478 ) Comprehensive income attributable to common stock $ 636 $ 1,912 $ 1,012 $ 3,665 There were no other comprehensive income (loss) items related to noncontrolling interests for the three and six months ended June30, 2009 and 2008.

Supplemental Cash Flow Informat

Supplemental Cash Flow Information
	6 Months Ended Jun. 30, 2009 USD / shares
Notes to Consolidated Condensed Financial Statements
Supplemental Cash Flow Information	5. Supplemental Cash Flow Information Income taxes paid (received) for the six months ended June30, 2009 and 2008 were $(175) million and $966 million for U.S. taxes, respectively, and $691 million and $1.5 billion for foreign taxes, respectively. Interest paid totaled approximately $81 million and $52 million for the six months ended June30, 2009 and 2008, respectively.

Inventories

Inventories
	6 Months Ended Jun. 30, 2009 USD / shares
Notes to Consolidated Condensed Financial Statements
Inventories	6. Inventories A portion of inventories is valued under the LIFO method. The valuation of LIFO inventory for interim periods is based on Occidentals estimates of year-end inventory levels and costs. Inventories as of June30, 2009, and December31, 2008, consisted of the following (in millions): 2009 2008 Raw materials $ 68 $ 123 Materials and supplies 544 412 Finished goods 528 494 1,140 1,029 LIFO reserve (71 ) (71 ) Total $ 1,069 $ 958

Environmental Liabilities and E

Environmental Liabilities and Expenditures
	6 Months Ended Jun. 30, 2009 USD / shares
Notes to Consolidated Condensed Financial Statements
Environmental Liabilities and Expenditures	7. Environmental Liabilities and Expenditures Occidentals operations are subject to stringent federal, state, local and foreign laws and regulations relating to improving or maintaining environmental quality. Occidentals environmental compliance costs have generally increased over time and could continue to rise in the future. Occidental factors environmental expenditures for its operations into its business planning process as an integral part of producing quality products responsive to market demand. The laws that require or address environmental remediation, including the Comprehensive Environmental Response, Compensation, and Liability Act (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 involving 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 June30, 2009, Occidental participated in or monitored remedial activities or proceedings at 167 sites. The following table presents Occidentals environmental remediation reserves as of June30, 2009, the current portion of which is included in accrued liabilities ($68 million) and the remainder in deferred credits and other liabilities other ($339 million). The reserves are grouped in the following four categories of environmental remediation sites: (1)sites listed or proposed for listing by the U.S. Environmental Protection Agency on the CERCLA National Priorities List (CERCLA NPL); (2)other third-party sites; (3)Occidental-operated sites; and (4)Occidentals closed or non-operated sites. Number of Sites Reserve Balance (in millions) CERCLA NPL sites 40 $ 58 Other third-party sites 77 107 Occidental-operated sites 19 119 Occidentals closed or non-operated sites 31 123 Total 167 $ 407 As of June30, 2009, Occidentals environmental reserves exceeded $10 million at 13 of the 167 sites described above, and 114 of the sites had reserves from $0 to $1 million. Occidental expects to expend funds corresponding to about half of the current environmental reserves over the next four years and the balance over the subsequent ten or more years. Occidental believes its range of reasonably possible additional loss beyond those liabilities recorded for environmental remediation at the sites described above could be up to $400 million. The status of Occidentals involvement with the sites and related significant assumptions have not changed materia

Lawsuits, Claims, Commitments,

Lawsuits, Claims, Commitments, Contingencies and Related Matters
	6 Months Ended Jun. 30, 2009 USD / shares
Notes to Consolidated Condensed Financial Statements
Lawsuits, Claims, Commitments, Contingencies and Related Matters	8. Lawsuits, Claims, Commitments, Contingencies and Related Matters OPC or certain of its subsidiaries are named, 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, punitive damages, civil penalties or other losses, or injunctive or declaratory relief. OPC or certain of its subsidiaries also have been named 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; however, Occidental is usually one of many companies in these proceedings and has to date been successful in sharing response costs with other financially sound companies. With respect to all such lawsuits, claims and proceedings, including environmental proceedings, Occidental accrues reserves when it is probable a liability has been incurred and the amount of loss can be reasonably estimated. Lawsuits have been filed in Nicaragua against Occidental Chemical Corporation (OxyChem) and other companies that once manufactured or used a pesticide, dibromochloropropane (DBCP). These lawsuits claim damages of several billion dollars for alleged personal injuries. In the opinion of management, the claims against OxyChem are without merit because, among other things, the DBCP it manufactured was never sold or used in Nicaragua. In order to preserve its jurisdictional defense, OxyChem elected not to make a substantive appearance in these cases. Nicaraguan courts have entered judgments of approximately $900 million against four defendants, including OxyChem. Under Nicaraguan law, the judgments would be shared equally among the defendants. The plaintiffs attempted to enforce one judgment in Miami. In January2009, the federal district court in Miami granted summary judgment in favor of OxyChem and refused to enforce the judgment. OxyChem has no assets in Nicaragua and, in the opinion of management, no such Nicaraguan judgment would be enforceable in the United States. 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. While the audits for taxable years through 2007 have concluded for U.S. federal income tax purposes, the 2008 taxable year as well as the current period are currently under audit by the U.S. Internal Revenue Service pursuant to its compliance assurance program. Foreign government tax authorities are in various stages of auditing Occidental, and income taxes for taxable years from 2000 through 2008 remain subject to examination in certain jurisdictions. During the course of such audits, disputes have arisen and other disputes may arise as to facts and matters of law. Occidental has indemnified various parties against specified liabilities that those parties might incur in the future in connection with purchases and other transactions that they have entered into with Occidental. Thes

Retirement Plans and Postretire

Retirement Plans and Postretirement Benefits
	6 Months Ended Jun. 30, 2009 USD / shares
Notes to Consolidated Condensed Financial Statements
Retirement Plans and Postretirement Benefits	9. Retirement Plans and Postretirement Benefits The following table sets forth the components of the net periodic benefit costs for Occidentals defined benefit pension and postretirement benefit plans for the three and six months ended June30, 2009 and 2008 (in millions): Three months ended June30 2009 2008 Net Periodic Benefit Costs Pension Benefit Postretirement Benefit Pension Benefit Postretirement Benefit Service cost $ 4 $ 4 $ 2 $ 4 Interest cost 7 10 7 9 Expected return on plan assets (7 ) (9 ) Recognized actuarial loss 4 6 4 Total $ 8 $ 20 $ $ 17 Six months ended June30 2009 2008 Net Periodic Benefit Costs Pension Benefit Postretirement Benefit Pension Benefit Postretirement Benefit Service cost $ 8 $ 8 $ 4 $ 7 Interest cost 14 20 14 19 Expected return on plan assets (13 ) (19 ) Recognized actuarial loss 8 11 1 8 Total $ 17 $ 39 $ $ 34 Occidental contributed $3 million and $5 million to its defined benefit pension plans for the three and six months ended June30, 2009, respectively, and expects to contribute an additional $5 million in the remainder of 2009. Occidental contributed $1 million and $2 million to its defined benefit pension plans for the three and six months ended June30, 2008, respectively.

Fair Value Measurements

Fair Value Measurements
	6 Months Ended Jun. 30, 2009 USD / shares
Notes to Consolidated Condensed Financial Statements
Fair Value Measurements	10. Fair Value Measurements Occidental has categorized its assets and liabilities that are measured at fair value, based on the priority of the inputs to the valuation technique, into a three-level fair value hierarchy: Level 1 is the use of quoted prices in active markets for identical assets or liabilities; Level 2 is the use of other observable inputs other than quoted prices; and Level 3 is the use of unobservable inputs. The following table provides fair value measurement information for such assets and liabilities that are measured on a recurring basis (in millions): Fair Value Measurements at June30, 2009 Using: Description Total Fair Value Level 1 Level 2 Level 3 Assets: Derivative financial instruments(a) Marketing and trading assets and other $ 244 $ 43 $ 201 $ Long-term receivables and other assets, net 139 139 Total assets $ 383 $ 43 $ 340 $ Liabilities: Derivative financial instruments(a) Accrued liabilities $ (283 ) $ (8 ) $ (275 ) $ Deferred credits and other liabilities-other (338 ) (1 ) (337 ) Total liabilities $ (621 ) $ (9 ) $ (612 ) $ (a) Derivative fair values are reported on a net basis to the extent a legal right of offset with a counterparty exists. For the six months ended June30, 2009, Occidental did not have any assets or liabilities measured at fair value on a non-recurring basis. Occidental utilized the mid-point price between bid and ask prices for valuing the majority of its assets and liabilities measured and reported at fair value. Occidental utilizes market data and assumptions in pricing the assets or liabilities, including assumptions about risk and the risks inherent in the inputs to the valuation technique. Occidental primarily applies the market approach for recurring fair value measurements and utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. Certain of Occidentals derivative instruments are valued using industry-standard models that consider various assumptions, including quoted forward prices for commodities, time value, volatility factors, and current market and contractual prices for the underlying instruments, as well as other relevant economic measures. Substantially all of these assumptions are observable in the marketplace throughout the full term of the instrument, can be derived from observable data or are supported by observable prices at which transactions are executed in the marketplace. Cash and cash equivalents carrying amounts approximate fair value because of the short maturity of those instruments. The carrying value of other on-balance-sheet financial instruments, other than fixed-rate debt, approximates fair value, and the cost, if any, to terminate off-balance-sheet financial instruments is not significant. Occidental estimates the fair value of its long-term fixed-rate debt based on the quoted market prices for its debt instruments or on quoted market yields for similarly rated debt instrumen

Derivatives

Derivatives
	6 Months Ended Jun. 30, 2009 USD / shares
Notes to Consolidated Condensed Financial Statements
Derivatives	11. Derivatives As discussed in Note 3, Occidental adopted SFAS No.161 on January1, 2009. Derivatives are carried at fair value and, when a legal right of offset with the same counterparty exists, Occidental records these derivatives on a net basis. Occidental applies hedge accounting when transactions meet specified criteria for such treatment. If a derivative does not qualify as a hedge or is not designated as a hedge, any fair value gains or losses are recognized in earnings in the current period. If the derivative qualifies for cash flow hedge accounting and is designated and documented as a hedge, the effective portion of the gain or loss on 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 items designated as cash flow hedges, and any ineffectiveness, 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 transactions. Gains and losses from derivative instruments are reported net in the consolidated statements of income. There were no fair value hedges as of and for the three and six months ended June30, 2009. Occidental is exposed to risk that is inherent in changing commodity prices. In order to mitigate price risk, Occidental, from time to time, enters into derivative financial transactions. Occidental periodically uses different types of derivative instruments to achieve the best prices for oil and gas. Derivatives have been used by Occidental to reduce its exposure to price volatility on a small portion of its oil and gas production. Occidental also enters into low-risk marketing and trading activities through its separate marketing and trading organization, which operates under established policy controls and procedures. Occidentals marketing and trading operations utilize a combination of futures, forwards, options and swaps to mitigate the price risk associated with various physical transactions. A majority of Occidentals derivative transactions are exchange-traded contracts, which are subject to nominal credit risk as a significant portion of these derivative transactions are executed on a daily margin basis. Cash collateral of $149 million deposited by Occidental with clearing houses, which has not been applied against the derivative fair values, is included in the marketing and trading assets and other balance as of June30, 2009. In addition, Occidental executes a portion of its derivative transactions in the over-the-counter (OTC) market with various high-credit-quality counterparties. 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, and by entering into master netting arrangements with the counterparties, as appropriate. Occide

Industry Segments

Industry Segments
	6 Months Ended Jun. 30, 2009 USD / shares
Notes to Consolidated Condensed Financial Statements
Industry Segments	12. Industry Segments Occidental conducts its continuing operations through three segments (1)oil and gas, (2)chemical and (3)midstream, marketing and other (midstream and marketing). The oil and gas segment explores for, develops, produces and markets crude oil, natural gas liquids (NGLs), condensate and natural gas. The chemical segment manufactures and markets basic chemicals, vinyls and performance chemicals. The midstream and marketing segment gathers, treats, processes, transports, stores, trades and markets crude oil, natural gas, NGLs, condensate and carbon dioxide and generates and markets power. Segment earnings generally 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 assets and income from the segments equity investments. The following table presents Occidentals industry segment and corporate disclosures (in millions): Oil and Gas Chemical Midstream, Marketing and Other Corporate and Eliminations Total Six months ended June30, 2009 Net sales $ 4,863 $ 1,603 $ 478 $ (184 )(a) $ 6,760 Pretax operating profit (loss) $ 1,649 $ 284 $ 77 $ (238 )(b) $ 1,772 Income taxes (696 )(c) (696 ) Discontinued operations (5 ) (5 ) Net income attributable to noncontrolling interest (21 ) (21 ) Net income (loss) attributable to common stock $ 1,628 $ 284 $ 77 $ (939 ) $ 1,050 Six months ended June30, 2008 Net sales $ 10,019 $ 2,653 $ 823 $ (359 )(a) $ 13,136 Pretax operating profit (loss) $ 6,760 $ 323 $ 284 $ (217 )(b) $ 7,150 Income taxes (2,965 )(c) (2,965 ) Discontinued operations 24 (d) 24 Net income attributable to noncontrolling interest (66 ) (66 ) Net income (loss) attributable to common stock $ 6,694 $ 323 $ 284 $ (3,158 ) $ 4,143 (a) Intersegment sales are generally made at prices approximately equal to those that the selling entity is able to obtain in third-party transactions. (b) Includes net interest expense, administration expense, environmental remediation and other pre-tax items. (c) Includes all foreign and domestic income taxes from continuing operations. (d) In 2008, Occidental received a $61 million refund of taxes from Ecuador.

Earnings Per Share

Earnings Per Share
	6 Months Ended Jun. 30, 2009 USD / shares
Notes to Consolidated Condensed Financial Statements
Earnings Per Share	13. Earnings Per Share As discussed in Note 3, Occidental adopted FSP No.EITF 03-6-1 on January1, 2009. Nonvested share-based payment awards granted by Occidental containing rights to nonforfeitable dividends are considered participating securities. These securities allow the holders to participate in all dividends declared with the holders of common stock. Accordingly, Occidental applies the two-class method when computing basic and diluted EPS. Prior period EPS data has been adjusted retrospectively to conform to the provisions of this FSP. Basic EPS was computed by dividing net income attributable to common stock 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 further reflected the dilutive effect of stock options and performance-based stock awards. The following table presents the calculation of basic and diluted EPS for the three and six months ended June30, 2009 and 2008: Periods Ended June30 Three months Six months (in millions, except per share amounts) 2009 2008 2009 2008 Basic EPS Income from continuing operations $ 696 $ 2,337 $ 1,076 $ 4,185 Less: Income from continuing operations attributable to noncontrolling interest (12 ) (37 ) (21 ) (66 ) Net income from continuing operations attributable to common stock 684 2,300 1,055 4,119 Discontinued operations (2 ) (3 ) (5 ) 24 Net income attributable to common stock 682 2,297 1,050 4,143 Less: Net income allocated to participating securities (1 ) (4 ) (1 ) (9 ) Net income attributable to common stock, net of participating securities $ 681 $ 2,293 $ 1,049 $ 4,134 Weighted average number of basic shares 811.0 821.3 810.8 822.5 Basic EPS $ 0.84 $ 2.79 $ 1.29 $ 5.03 Diluted EPS Net income attributable to common stock, net of participating securities $ 681 $ 2,293 $ 1,049 $ 4,134 Weighted average number of basic shares 811.0 821.3 810.8 822.5 Dilutive effect of potentially dilutive securities 3.0 3.9 2.9 4.1 Total diluted weighted average common shares 814.0 825.2 813.7 826.6 Diluted EPS $ 0.84 $ 2.78 $ 1.29 $ 5.00

Subsequent Event

Subsequent Event
	6 Months Ended Jun. 30, 2009 USD / shares
Notes to Consolidated Condensed Financial Statements
Subsequent Event	14. Subsequent Event On July22, 2009, Occidental announced that it had made a significant discovery of oil and gas reserves in Kern County, California. The bulk of the discoverys producing zones are conventional oil and gas bearing formations with approximately two-thirds of the discovery believed to be natural gas. Occidental is currently producingover 18,000 gross barrels of oil equivalent per day from this multi-pay zone discovery area. Occidentals interest in the discovery area is approximately 80 percent.

Document and Entity Information

Document and Entity Information (USD $)
In Billions, except Share data	6 Months Ended Jun. 30, 2009	Jun. 30, 2008
Document and Entity Information
Entity Registrant Name	OCCIDENTAL PETROLEUM CORPORATION
Entity Central Index Key	0000797468
Document Type	10-Q
Document Period End Date	2009-06-30
Amendment Flag	false
Amendment Description	No
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float		71.9
Entity Common Stock, Shares Outstanding	810,776,118