EXHIBIT 12 PENNZOIL COMPANY AND SUBSIDIARIES COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES For the nine months ended September 30, ---------------------------------- 1995 1994 ------------- ------------- (Dollar amounts expressed in thousands) Loss before cumulative effect of change in accounting principle $ (277,333) $ (272,254) Income tax provision (benefit) Federal and foreign (134,938) (212,719) State (8,361) 3,723 ------------- ------------- Total income tax benefit (143,299) (208,996) Interest charges 164,601 441,525 ------------- ------------- Loss before income tax benefit and interest charges $ (256,031) $ (39,725) ============= ============= Fixed charges $ 168,049 $ 448,434 ============= ============= Ratio of earnings to fixed charges (1.52) (0.09) ============= ============= Amount by which fixed charges exceed earnings $ 424,080 $ 488,159 ============= ============= DETAIL OF INTEREST AND FIXED CHARGES For the nine months ended September 30, ---------------------------------- 1995 1994 ------------- ------------- (Expressed in thousands) Interest charges per Consolidated Statement of Income which includes amortization of debt discount, expense and premium $ 148,016 $ 430,688 Add: portion of rental expense representative of interest factor <F1> 20,033 17,746 ------------- ------------- Total fixed charges $ 168,049 $ 448,434 Less: interest capitalized per Consolidated Statement of Income 3,448 6,909 ------------- ------------- Total interest charges $ 164,601 $ 441,525 ============= ============= <FN> <F1> Interest factor based on management's estimates and approximates one-third of rental expense. </FN>