SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
Current Report Pursuant
to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported) February 9, 2000
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UNOCAL CORPORATION
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(Exact name of registrant as specified in its charter)
Delaware
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(State or Other Jurisdiction of Incorporation)
1-8483 95-3825062
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(Commission File Number) (I.R.S. Employer Identification No.)
2141 Rosecrans Avenue, Suite 4000, El Segundo, California 90245
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(Address of Principal Executive Offices) (Zip Code)
(310) 726-7600
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(Registrant's Telephone Number, Including Area Code)
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Item 5. Other Events.
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Unocal Corporation outlined its financial outlook and strategic approaches for
2000 at its annual global company review for Wall Street analysts and portfolio
managers.
The company said it expects adjusted per share earnings of $1.40 to $1.50 for
2000 with a return on capital employed (ROCE) in the 8 to 9 percent range.
The forecasts for earnings and ROCE assume a worldwide production level of
528,000 barrels of oil equivalent per day, including minority and equity
interests, an average West Texas Intermediate price of $21.50 per barrel of oil
and a Henry Hub natural gas price of $2.55 per thousand cubic feet. This
forecast also excludes projected earnings of $12 million to $24 million for the
Unocal's agricultural products segment, which is expected to be sold in 2000.
The base case WTI price is significantly below the current NYMEX quote, and the
company said it expects continued volatility in 2000, making accurate
forecasting difficult. Unocal's adjusted earnings will change 14 cents per share
for every $1 change in its average worldwide price of oil and 7 cents per share
for every 10 cent change in the company's average Lower 48 natural gas price.
The forecasts also reflects certain assumptions on the success rate of the
overall exploration portfolio. Unocal's earnings will change 11 cents per share
for every 10-percent change in the overall success rate of the company's
exploration drilling program.
The company is committed to improving the corporate return on capital employed.
The company plans to do this by growing profitable production, continuing to
attack its cost structure, and significantly increasing the percentage of
development capital versus exploration capital
The company has kept its capital spending basically flat in 2000. The company is
forecasting capital expenditures of $1.2 billion to $1.3 billion. This spending
level includes capital for consolidated subsidiaries.
Management's goal is to return free cash flow to the stockholders in the form of
cash dividends, debt reduction and possible share repurchases.
Forward-looking statements regarding forecasted earnings, cash flow, capital
expenditures, commodity prices, return on capital, depreciation and
amortization, expenses, and expected drilling success in this filing are based
on assumptions concerning operational, geological, market, competitive,
regulatory, environmental, and other considerations. Actual results could differ
materially as a result of factors discussed in Unocal Corporation's 1998 Form
10-K report filed with the U.S. Securities and Exchange Commission.
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Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
UNOCAL CORPORATION
(Registrant)
Date: Februrary 15, 2000 By: /s/ JOE D. CECIL
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Joe D. Cecil
Vice President and Comptroller