SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________
FORM 11-K
ANNUAL REPORT
____________________
Pursuant to Section 15(d) of the
Securities Exchange Act of 1934
____________________
For the Fiscal Year Ended December 31, 1996
_____________________
PENNZOIL COMPANY SAVINGS AND INVESTMENT PLAN
Commission File No. 1-5591
______________________
PENNZOIL COMPANY
Pennzoil Place, P. O. Box 2967
Houston, Texas 77252-2967
(Name of issuer of securities held pursuant to the plan and
address of its principal executive office)
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Administrative Committee,
Pennzoil Company Savings and
Investment Plan:
We have audited the accompanying statements of net assets available
for benefits of the Pennzoil Company Savings and Investment Plan (the
Plan) as of December 31, 1996 and 1995, and the related statement of
changes in net assets available for benefits for the year ended
December 31, 1996. These financial statements and the schedules
referred to below are the responsibility of the Plan's administrative
committee. Our responsibility is to express an opinion on these
financial statements and schedules based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by the Plan's
administrative committee, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the net assets available for
benefits of the Plan as of December 31, 1996 and 1995, and the changes
in net assets available for benefits for the year ended December 31,
1996, in conformity with generally accepted accounting principles.
Our audits were performed for the purpose of forming an opinion on the
basic financial statements taken as a whole. The supplemental
schedules of assets held for investment purposes as of December 31,
1996, included as Schedule I, and reportable transactions (series of
investment transactions) for the year ended December 31, 1996,
included as Schedule II, are presented for purposes of additional
analysis and are not a required part of the basic financial statements
but are supplementary information required by the Department of
Labor's Rules and Regulations for Reporting and Disclosure under the
Employee Retirement Income Security Act of 1974. The Fund Information
in the statements of net assets available for benefits and statement
of changes in net assets available for benefits is presented for
purposes of additional analysis rather than to present the net assets
available for benefits and changes in net assets available for
benefits of each fund. The supplemental schedules and Fund
Information have been subjected to the auditing procedures applied in
the audits of the basic financial statements and, in our opinion, are
fairly stated in all material respects in relation to the basic
financial statements taken as a whole.
ARTHUR ANDERSEN LLP
Houston, Texas
June 16, 1997
PENNZOIL COMPANY SAVINGS AND INVESTMENT PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
(WITH FUND INFORMATION)
DECEMBER 31, 1996
Participant Directed Funds
------------------------------------------------------------------------------------
Merrill J. P. Fidelity Merrill Davis
Lynch Morgan Advisor Lynch New
Retirement Institutional Income & Equity York
Preservation Bond Growth Index Venture
Trust Fund Fund Trust Fund
------------ ------------ ------------ ------------ ------------
ASSETS:
Investments, at current value-
Pennzoil Company common stock $ - $ - $ - $ - $ -
Battle Mountain Gold Company
common stock - - - - -
Merrill Lynch Retirement
Preservation Trust 22,453,443 - - - -
Mutual funds - 1,300,025 4,083,880 28,486,752 13,604,944
Participant loans - - - - -
Cash and temporary investments - - - - -
Receivables-
Employee contributions 65,791 7,486 26,028 70,664 62,563
Employer contributions - - - - -
Investment income - - - - -
------------ ------------ ------------ ------------ ------------
Total assets 22,519,234 1,307,511 4,109,908 28,557,416 13,667,507
LIABILITIES:
Due to trustee - - - - -
------------ ------------ ------------ ------------ ------------
NET ASSETS AVAILABLE
FOR BENEFITS $22,519,234 $ 1,307,511 $ 4,109,908 $28,557,416 $13,667,507
============ ============ ============ ============ ============
<FN>
See notes to financial statements.
</FN>
Non-
Participant
Participant Directed Funds Directed
------------------------------ ------------
Company Company
Loan Stock Stock
Fund Fund Fund Total
------------ ------------ ------------ -------------
ASSETS:
Investments, at current value-
Pennzoil Company common stock $ - $19,435,092 $60,860,439 $ 80,295,531
Battle Mountain Gold Company
common stock - 60,311 74,552 134,863
Merrill Lynch Retirement
Preservation Trust - - - 22,453,443
Mutual funds - - - 47,475,601
Participant loans 6,755,622 - - 6,755,622
Cash and temporary investments - - 76,731 76,731
Receivables-
Employee contributions - 63,718 - 296,250
Employer contributions - - 231,914 231,914
Investment income - - 25,810 25,810
------------ ------------ ------------ -------------
Total assets 6,755,622 19,559,121 61,269,446 157,745,765
LIABILITIES:
Due to trustee - - - -
------------ ------------ ------------ -------------
NET ASSETS AVAILABLE
FOR BENEFITS $ 6,755,622 $19,559,121 $61,269,446 $157,745,765
============ ============ ============ =============
<FN>
See notes to financial statements.
</FN>
PENNZOIL COMPANY SAVINGS AND INVESTMENT PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
(WITH FUND INFORMATION)
DECEMBER 31, 1995
Participant Directed Funds
------------------------------------------------------------------------------------
Merrill J. P. Fidelity Merrill Davis
Lynch Morgan Advisor Lynch New
Retirement Institutional Income & Equity York
Preservation Bond Growth Index Venture
Trust Fund Fund Trust Fund
------------ ------------ ------------ ------------ ------------
ASSETS:
Investments, at current value-
Pennzoil Company common stock $ - $ - $ - $ - $ -
Battle Mountain Gold Company
common stock - - - - -
Merrill Lynch Retirement
Preservation Trust 21,462,020 - - - -
Mutual funds - 1,070,138 3,799,680 23,160,772 7,828,868
Participant loans - - - - -
Receivables-
Employee contributions 65,998 4,552 22,758 54,619 34,137
Employer contributions - - - - -
Investment income - - - - -
------------ ------------ ------------ ------------ ------------
Total assets 21,528,018 1,074,690 3,822,438 23,215,391 7,863,005
LIABILITIES:
Due to trustee - - - - -
------------ ------------ ------------ ------------ ------------
NET ASSETS AVAILABLE
FOR BENEFITS $21,528,018 $ 1,074,690 $ 3,822,438 $23,215,391 $ 7,863,005
============ ============ ============ ============ ============
<FN>
See notes to financial statements.
</FN>
Non-
Participant
Participant Directed Funds Directed
------------------------------ ------------
Company Company
Loan Stock Stock
Fund Fund Fund Total
------------ ------------ ------------ -------------
ASSETS:
Investments, at current value-
Pennzoil Company common stock $ - $16,075,432 $43,200,481 $ 59,275,913
Battle Mountain Gold Company
common stock - 80,468 99,470 179,938
Merrill Lynch Retirement
Preservation Trust - - - 21,462,020
Mutual funds - - - 35,859,458
Participant loans 6,042,027 - - 6,042,027
Receivables-
Employee contributions - 45,514 - 227,578
Employer contributions - - 181,383 181,383
Investment income - - 17,232 17,232
------------ ------------ ------------ -------------
Total assets 6,042,027 16,201,414 43,498,566 123,245,549
LIABILITIES:
Due to trustee - 397,193 220,691 617,884
------------ ------------ ------------ -------------
NET ASSETS AVAILABLE
FOR BENEFITS $ 6,042,027 $15,804,221 $43,277,875 $122,627,665
============ ============ ============ =============
<FN>
See notes to financial statements.
</FN>
PENNZOIL COMPANY SAVINGS AND INVESTMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
(WITH FUND INFORMATION)
FOR THE YEAR ENDED DECEMBER 31,1996
Participant Directed Funds
---------------------------------------------------------------------------------------
Merrill J.P. Fidelity Merrill Davis
Lynch Morgan Advisor Lynch New
Retirement Institutional Income & Equity York
Preservation Bond Growth Index Venture
Trust Fund Fund Trust Fund
-------------- ------------- ------------- ------------- -------------
NET ASSETS AVAILABLE FOR BENEFITS,
beginning of year $ 21,528,018 $ 1,074,690 $ 3,822,438 $ 23,215,391 $ 7,863,005
CONTRIBUTIONS:
Employee 2,391,112 275,041 949,313 2,584,454 2,302,392
Employer - - - - -
Rollovers from qualified plans 3,470 12,070 28,609 10,484 56,868
(Note 1)
INVESTMENT INCOME:
Dividends - 72,793 149,743 - 648,079
Interest 1,265,119 - - - -
Loan Repayment Interest 138,017 9,368 26,319 136,643 82,770
NET APPRECIATION (DEPRECIATION)
IN FAIR VALUE OF INVESTMENTS - (31,570) 168,151 5,196,534 1,946,242
NET TRANSFERS (Note 1)
Among Funds 212,705 (5,234) (588,408) 871,105 1,835,393
(To) From Hourly Plan (17,634) (1,063) (1,324) 46,668 -
ADMINISTRATIVE EXPENSES (Note 1) (4,452) (268) (850) (4,307) (1,589)
DISTRIBUTIONS AND WITHDRAWALS (2,820,234) (104,272) (396,797) (3,065,422) (1,032,116)
(Note 1)
PARTICIPANT LOANS (Note 1)
New Loans Issued (1,046,400) (55,654) (179,237) (1,110,629) (470,074)
Principal Received 773,770 61,342 131,101 669,463 434,949
OTHER 95,743 268 850 7,032 1,588
------------- ------------ ------------- -------------- -------------
NET ASSETS AVAILABLE FOR BENEFITS,
end of year $ 22,519,234 $ 1,307,511 $ 4,109,908 $ 28,557,416 $ 13,667,507
============== ============ ============= ============== ==============
<FN>
See notes to financial statements.
</FN>
Non
Participant
Participant Directed Funds Directed
--------------------------------- --------------
Company Company
Loan Stock Stock
Fund Fund Fund Total
-------------- ------------- ------------- -------------
NET ASSETS AVAILABLE FOR BENEFITS,
beginning of year $ 6,042,027 $ 15,804,221 $ 43,277,875 $122,627,665
CONTRIBUTIONS:
Employee - 2,334,158 - 10,836,470
Employer - - 8,588,477 8,588,477
Rollovers from qualified plans - 36,655 - 148,156
(Note 1)
INVESTMENT INCOME:
Dividends - 357,770 1,049,277 2,277,662
Interest - - 8,578 1,273,697
Loan Repayment Interest - 127,607 - 520,724
NET APPRECIATION (DEPRECIATION)
IN FAIR VALUE OF INVESTMENTS - 6,119,652 15,114,214 28,513,223
NET TRANSFERS (Note 1)
Among Funds - (1,908,053) (417,508) -
(To) From Hourly Plan - - 6,376 33,023
ADMINISTRATIVE EXPENSES (Note 1) - (4,770) (2,643) (18,879)
DISTRIBUTIONS AND WITHDRAWALS (410,991) (2,825,502) (6,231,970) (16,887,304)
(Note 1)
PARTICIPANT LOANS (Note 1)
New Loans Issued 3,877,104 (1,015,110) - -
Principal Received (2,747,952) 677,327 - -
OTHER (4,566) (144,834) (123,230) (167,149)
------------- ------------- ------------- --------------
NET ASSETS AVAILABLE FOR BENEFITS,
end of year $ 6,755,622 $ 19,559,121 $ 61,269,446 $157,745,765
============== ============= ============= ==============
<FN>
See notes to financial statements
</FN>
PENNZOIL COMPANY SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
1. DESCRIPTION OF THE PLAN:
General
The Pennzoil Company Savings and Investment Plan (the Plan) was
established effective December 20, 1986, by Pennzoil Company. The
purpose of the Plan is to encourage employees of Pennzoil Company
and participating subsidiaries and affiliated companies
(collectively referred to as Pennzoil) to save, and invest
systematically, a portion of their current compensation in order
that they may have an additional source of income upon their
retirement or disability, or for their families in the event of
their death.
Each person employed by Pennzoil as of December 20, 1986 (effective
date), who was a member of the Pennzoil Company and Participating
Companies Employees Stock Purchase Plan (Pennzoil Stock Purchase
Plan) or the Employee Stock Ownership Plan of Pennzoil Company
(Pennzoil Stock Ownership Plan), became eligible to participate in
the Plan on that date. All other salaried employees become
eligible to participate in the Plan on the effective date or entry
date coinciding with or immediately following their completion of
one year of service. Effective January 1, 1989, the account
balances of all hourly employees (if such hourly employee was a
member of a collective bargaining unit to which the Plan had been
made available) were transferred to the Pennzoil Company Savings
and Investment Plan for Hourly Employees (Hourly Plan). Upon
changing wage status, a participant's account balance is
transferred between the Plan and the Hourly Plan. Such transfers
are reflected at current value as of the date of transfer in the
accompanying financial statements.
Effective October 24, 1986, the Pennzoil Stock Purchase Plan and
Pennzoil Stock Ownership Plan were terminated. As a result of
these terminations, participants were able to elect to receive all
Pennzoil Company common stock (Common Stock) and Battle Mountain
Gold Company common stock (Battle Mountain Stock), as well as the
cash value of any related fractional shares, or to transfer such
vested amounts to the Plan.
In January 1990, Pennzoil acquired 80 percent (on a fully diluted
basis) of the common stock of Jiffy Lube International, Inc.
Effective October 1, 1990, the board of directors of Pennzoil
approved the merger of the assets of the Jiffy Lube International,
Inc. 401(k) Plan and Trust Agreement (Jiffy Lube Plan) into the
Plan. Accordingly, the account balances of participants in the
Jiffy Lube Plan were transferred to the Plan. The Pennzoil Stock
Purchase Plan, the Pennzoil Stock Ownership Plan and the Jiffy Lube
Plan are collectively referred to as the Prior Plans.
The transferred amounts applicable to the Prior Plans are
maintained in separate accounts for each participant (Prior Plan
Accounts) segregated into amounts representing each participant's
employee and employer accounts under the Prior Plans (see
"Investment Choices" below).
Contributions
In order to participate in the Plan, an eligible employee may
authorize, by payroll deduction, a contribution of not less than
1 percent and not more than 12 percent of annual compensation.
Employee contributions may be made "after-tax" or, under a
Section 401(k) option, on a "before-tax" basis. Pennzoil will
match an employee's contribution dollar-for-dollar up to 6
percent of their base pay.
Upon written request filed with the administrative committee, a
participant in the Plan or an employee of Pennzoil who is otherwise
eligible to participate in the Plan but who has not yet completed
the participation requirements may transfer an amount from another
qualified investment plan (Rollover Amount) into the Plan, provided
that such Rollover Amount is transferred in the form of cash. The
Rollover Amount will be deposited in an investment fund and shall
at all times be fully vested and nonforfeitable and share in the
income of the investment fund. However, such Rollover Amount will
not share in employer matching contributions.
Investment Choices
Employer contributions are invested solely in Common Stock. At
Pennzoil's option, employer contributions may be made either in
cash or in Common Stock. Therefore, the statement of net assets
available for benefits and statement of changes in net assets
available for benefits present participant directed and non-
participant directed activity separately. During 1996, Pennzoil
contributed 178,002 shares of its Common Stock valued at the
average of the high and low market prices on the date of the
contribution. All employee and employer contributions (other than
stock) are initially invested in interest-bearing short-term,
highly liquid investments and are classified in the accompanying
statements of net assets available for benefits under the caption
"Cash and temporary investments."
Participants who have attained age 55 have the option to transfer
all or a part of their existing employer contributions to be
invested among the various investment options. Employee
contributions are invested, as designated by participating
employees, in the following investment funds:
Fund Name Type of Investment(s)
I. Merrill Lynch Retirement Invests primarily in guaranteed
Preservation Trust investment contracts (generally
with insurance companies or
banks which agree to return
principal and a stated rate of
return over a specified period
of time) and U.S. Government
and U.S. Government Agency
securities.
II. J. P. Morgan Institutional Normally, at least 65% of the
Bond Fund fund's assets will be
represented by investment in
securities rated "A" or better
by a major ratings agency. The
fund's duration (a measure of
average maturity) ranges
between 3-1/2 and 5-1/2 years.
III. Fidelity Advisor Income Invests in a diversified
and Growth Fund portfolio of equity and fixed-
income securities with income,
growth of income and capital
appreciation potential.
IV. Merrill Lynch Equity Index Consists of common stocks
Trust that, to the extent possible,
duplicate the composition of
Standard & Poor's Index of
500 stocks.
V. Davis New York Venture Invests primarily in common
Fund (formerly New York stock and securities
Venture Fund) convertible into common stock.
The fund ordinarily invests in
securities which the Fund
management believes have
above-average appreciation
potential.
VI. Company Stock Fund Common stock of Pennzoil Company
Under the terms of the Plan, Prior Plan Accounts are not commingled
with other Plan assets for investment purposes, are not allocated
investment income from other Plan assets and are not allocated
employer contributions. In addition, amounts transferred to the
Plan from the Pennzoil Stock Purchase Plan and Pennzoil Stock
Ownership Plan must remain invested in Common Stock and Battle
Mountain Stock. Amounts transferred from the employer account of
the Jiffy Lube Plan must remain invested in Common Stock while
amounts transferred from the employee account may be invested in
any one of the six options described above. Dividends or other
income earned on shares of Common Stock and Battle Mountain Stock
in the Prior Plan Accounts are required to be reinvested in Common
Stock. Participants are fully vested in such Prior Plan Accounts
and will receive distributions upon giving written notice to the
administrative committee for withdrawals or upon termination of
employment. Included in Prior Plan Accounts at December 31, 1996
and 1995, respectively, are 68,105 and 78,293 shares of Common
Stock and 19,547 and 21,169 shares of Battle Mountain Stock which
have been reflected in the Non-Participant Directed Company Stock
Fund in the accompanying financial statements. The fair value of
the Common Stock was $3,847,932 at December 31, 1996, and
$3,307,897 at December 31, 1995. The fair value of the Battle
Mountain Stock was $134,863 at December 31, 1996, and $179,938 at
December 31, 1995.
Loans
A participant may apply to the administrative committee of the Plan
to borrow from his accounts, subject to certain limitations. Such
loans will be for a term not to exceed five years (20 years in the
case of loans to purchase a primary residence) and cannot exceed
the lesser of $50,000 or 50 percent of the participant's account
balances.
Participant loans are reported as an asset of the Loan Fund and
principal and interest payments received are transferred to the
investment funds based on the participant's current contribution
elections.
Vesting and Disposition of Forfeitures
Participants are always fully vested in employee contributions.
Participants vest in employer contributions at a rate of 25 percent
per year beginning at the end of two years of service, becoming
fully vested after five years of service or attainment of age 55.
Any nonvested portion of employer contributions shall be forfeited
upon termination. Forfeitures shall be allocated as follows:
first, to reinstate any employer contribution amounts of
participants who return to service and second, to restore any
amounts previously forfeited as unclaimed benefits. Any remaining
amounts are applied to reduce succeeding employer contributions.
Forfeitures available for allocation as of December 31, 1996 and
1995 were $416,609 and $263,776, respectively. The amount of
forfeitures utilized during 1996 was $494,838.
Withdrawals
Withdrawals may be made from either of an employee's previous pretax
or after-tax contributions, net of previous withdrawals, upon
written notice to the administrative committee. After-tax
withdrawals cause the participants to forfeit the right to
participate in the Plan for 180 days, while pretax withdrawals are
allowed only when the participant is age 59-1/2 or older, unless a
financial hardship exists. Hardship withdrawals will cause the
participants to be suspended from making further contributions for
365 days. Withdrawals may be made from employer contributions only
if the participant is fully vested and only after withdrawing all
amounts from any Prior Plan Accounts and any Rollover Amounts, and
not being in a suspended status.
Distribution of Benefits
Benefits are payable to participants or their beneficiaries at
retirement, permanent disability, death or termination of service.
Plan Administration
The Plan is administered by an administrative committee consisting
of at least three members appointed by the board of directors of
Pennzoil Company. Merrill Lynch Trust Company (Trustee) is sole
trustee of the Plan. All administrative expenses are borne by
Pennzoil Company with the exception of fees for investment
management and loan processing fees for participant loans.
The Plan is subject to reporting and regulations pursuant to the
Employee Retirement Income Security Act of 1974 (ERISA).
Termination or Amendment of the Plan
The Plan may be terminated, amended or modified by the board of
directors of Pennzoil Company at any time. Upon complete or
partial termination of the Plan, all amounts credited to the
accounts with respect to which the Plan has been terminated shall
become fully vested and nonforfeitable.
2. SUMMARY OF ACCOUNTING POLICIES:
Basis of Accounting
The financial statements of the Plan are presented on the accrual
basis of accounting. Amounts allocated to accounts of persons who
have withdrawn from participation in the earnings and operations of
the Plan are not recorded as a liability of the Plan but are
classified as a component of net assets available for benefits.
There were no such amounts outstanding at December 31, 1996 and 1995.
A separate account is maintained for each participant which
reflects the participant's contributions, net of withdrawals, and
the participant's allocable share of Pennzoil Company's
contributions and the Plan's investment earnings.
Management's Use of Estimates
The preparation of financial statements in conformity with
generally accepted accounting principles requires the plan's
management to use estimates and assumptions that affect the
accompanying financial statements and disclosures. Actual results
could differ from these estimates.
Asset Valuation
The Plan's investments are reflected in the accompanying financial
statements at year-end current values, which represent fair values.
For the Company Stock Fund, fair value was determined by using the
closing price of the securities held as listed on the New York
Stock Exchange on the last trading day of the Plan year. Fair
value of the mutual funds was determined based on the closing price
of the securities held by the collective fund as listed on the
applicable stock exchange on the last trading day of the Plan year
and the number of participating units held by the Plan. The
guaranteed investment contracts of the Retirement Preservation
Trust are fully benefit responsive and contract value approximates
fair value. Contract value for the Retirement Preservation Trust
was determined based on contributions made under the investment
contract plus interest earned at the contract's rate less funds
used to pay investment fees charged by the insurance companies.
Net appreciation (depreciation) in fair value of investments
consists of realized gains (losses) on sale of investments and
unrealized appreciation (depreciation) of investments. Realized
gains (losses) are calculated based on proceeds from the sale of
assets and the current value of the assets at the beginning of the
Plan year or at time of purchase if acquired during the current
Plan year. Unrealized appreciation (depreciation) of investments
is calculated based on the current value of the assets at the end
of the Plan year and the current value of the assets at the
beginning of the Plan year or at time of purchase if acquired
during the current Plan year.
3. FEDERAL INCOME TAXES:
The Plan received its latest determination letter on October 26,
1994, in which the Internal Revenue Service stated that the Plan,
as then designed, was in compliance with the applicable
requirements of the Internal Revenue Code. The Plan has since been
amended; however, the Plan administrator believes that the Plan is
currently designed and being operated in compliance with applicable
requirements of the Internal Revenue Code. Therefore, the Plan
administrator believes that the Plan was qualified and the related
trust was tax-exempt as of December 31, 1996 and 1995.
SCHEDULE I
PENNZOIL COMPANY SAVINGS AND INVESTMENT PLAN
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 1996
Current
Identity of Issue Description of Investment Cost Value
- --------------------- ------------------------- ----------- -----------
EQUITY SECURITIES:
Common stock-
Pennzoil Company <F1> 1,421,159 shares--$.83-1/3 par value $76,975,360 $80,295,531
Battle Mountain Gold Company 19,547 shares--$.10 par value 89,078 134,863
------------ ------------
Total equity securities 77,064,438 80,430,394
------------ ------------
INVESTMENT CONTRACTS:
Merrill Lynch Retirement
Preservation Trust <F1> 22,453,443 units 22,453,443 22,453,443
------------ ------------
MUTUAL FUNDS:
Merrill Lynch Equity Index Trust <F1> 579,458 units 18,799,053 28,486,752
Fidelity Advisor Income & Growth Fund 249,321 units 3,786,635 4,083,880
Davis New York Venture Fund, Inc. 777,425 units 11,143,378 13,604,944
J.P. Morgan Institutional Bond Fund 132,520 units 1,289,990 1,300,025
------------ ------------
Total mutual funds 35,019,056 47,475,601
------------ ------------
OTHER:
Cash and Temporary investments 76,731 76,731
Participant loans <F1>, at interest
rates ranging from 7.0% to 9.5% 6,755,622 6,755,622
------------ ------------
Total other assets 6,832,353 6,832,353
------------ ------------
Total assets held for $141,369,290 $157,191,791
investment purposes ============ ============
<FN>
<F1> Represents party in interest.
</FN>
SCHEDULE II
PENNZOIL COMPANY SAVINGS AND INVESTMENT PLAN
SCHEDULE OF REPORTABLE TRANSACTIONS
(SERIES OF INVESTMENT TRANSACTIONS)
FOR THE YEAR ENDED DECEMBER 31, 1996
Number of
Units or
Face Value Identity of Party Involved Purchase Selling Cost of Net Gain
Amount and Description of Assets Price <F1> Price <F1> Asset (Loss)
---------- --------------------------- ---------- ---------- -------- ---------
Pennzoil Company common stock,
$.83-1/3 par value-
113,851 Purchases (541 transactions) $5,321,441 $ - $5,321,441 $ -
172,530 Sales (690 transactions) - 8,257,650 8,958,300 (700,650)
Merrill Lynch Equity Index Trust-
113,000 Purchases (472 transactions) 4,984,166 - 4,984,167 -
111,233 Sales (567 transactions) - 4,854,720 3,542,970 1,311,750
Merrill Lynch Retirement
Preservation Trust-
7,034,751 Purchases (761 transactions) 7,034,751 - 7,034,751 -
6,043,328 Sales (570 transactions) - 6,043,328 6,043,328 -
Davis New York Venture Fund
380,385 Purchases (451 transactions) 6,095,522 - 6,095,523 -
142,138 Sales (395 transactions) - 2,265,688 2,006,696 258,992
<FN>
<F1> Current value of asset on transaction date is equal to the selling
price or purchase price. Prices are shown net of related expenses.
NOTE: This schedule is a listing of series of investment transactions in
the same security which exceed 5% of the current value of the Plan's
assets as of the beginning of the Plan year.
</FN>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the Administrative Committee has duly caused this report to be
signed by the undersigned thereunto duly authorized.
PENNZOIL COMPANY SAVINGS AND
INVESTMENT PLAN
By S/N James W. Shaddix
James W. Shaddix
Chairman of the Administrative Committee
June 24, 1997
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation of our report dated June 16, 1997, included herein, into
Pennzoil Company's previously filed Registration Statement on Form S-8
No. 33-51473.
ARTHUR ANDERSEN LLP
Houston, Texas
June 24, 1997