Occidental Petroleum Corporation Credit Suisse 2012 Energy Summit Stephen I. Chazen President and Chief Executive Officer February 6 - 7, 2012
Full Year 2011 Results Summary ( in millions, except EPS data) FY 2011 FY 2010 Core Results 6,828 4,664 Core EPS (diluted) 8.39 5.72 Net Income 6,771 4,530 Reported EPS (diluted) 8.32 5.56 Oil and Gas production volumes 733 706…
What Is Our Philosophy & Strategy Overriding Goal is to Maximize Total Shareholder Return We believe this can be achieved through a combination of: Growing our oil and gas production by 5 to 8% per year on average over the long…
Oxys Three Main Performance Criteria Production Growth, Returns & Dividend Growth We finished a strong year in terms of the three main performance criteria outlined last quarter. Our domestic oil and gas production grew by about…
Return on Assets (2007 2011) Net Income Return on Assets 5 Year Average U.S. 14% International 37% Total E&P 20% Cash Flow* Return on Assets 5 Year Average U.S. 21% International 54% Total E&P 29% * Net Income + DD&A See…
Finding & Development Costs per Barrel F&D Costs Actual as a % of 6:1 * Prices ** WTI Price 2010 20.25 24.18 30% 3-Year Average 16.38 20.25 25% (2008 2010) 5-Year Average 16.66 19.52 26% (2006 2010) 10-Year Average 12.22 13.48…
Dividend Growth Our ability to pay dividends is indicated by our free cash flow generation. Free cash flow after interest, taxes and capital spending, but before dividends, acquisitions and debt activity for 2011 was about 3.4…
Dividend Growth (/share) Note: Dividends paid as per the Record Date 8
Worldwide Oil & Gas Producing Areas United States Libya Iraq California Qatar Permian UAE Basin Bahrain Oman Yemen Colombia Bolivia Focus Areas 9
Oxy Is Primarily An Oil Company Oil & Gas Production * Full Year 2011 (Million barrels of oil equivalent) 74 111 28% 193 41% 156 72% 59% *Excludes Argentina 10
Realized Prices & Differentials About 60% of Oxys oil production tracks world oil prices and 40% is indexed to WTI. For example: In California our realized price was 109% of WTI and 94% of Brent in 2011. In Oman our average price…
Capital Spending 2012 Outlook We have ample legitimate opportunities in our domestic oil and gas business where we could deploy capital. We try to manage the program to a level that is realistic at current price levels, and as a…
Capital Spending 2012E vs. 2011 Actual We are increasing our capital program approximately 10% in 2012 to 8.3 billion from the 7.5 billion spent in 2011. About 500 million of this increase will be in the US, mainly in the Permian…
Oil & Gas Volume Growth Drivers Base 5 8% Compounded Average Annual Growth Current California risked prospects Non-CO2 & CO2 in the Permian Williston Basin Oman Iraq Upside from Existing Holdings New California conventional and…
US Oil & Gas Production 1H12 Outlook US oil and gas production In 1H12, we expect our domestic production to grow 3 to 4 mboe/d each month from the current quarterly average of 449 mboe/d, which would correspond to a 6 to 8 mboe/d…
US Oil & Gas Capital and Production 1,333 1,100 463 456 449 Domestic Capital (mm) Thousand boe per day 884 436 424 704 640 403 389 403 310 Capital (2 quarters earlier) Production Note: 1Q12E and 2Q12E production…
Oxys US Operated Rig Activity 72 70 Oxy Operated Domestic Rig Counts 38 Oxys US operated rigs represent approximately 6% of the total Liquids directed rigs operating in the Lower 48. 17
California Overview Largest acreage holder in CA with 1.7 mm acres, majority of which are net mineral interests. 768 mm BOE of proved reserves at year end 2010, of which 73% are oil. Sacramento 2011 production of 138 mboe/d. San…
California Capital Program We currently expect the rig count to remain constant in 1H12 at 31, the same In CA, we expect to spend about as what we were running at YE-2011; 21% of our total capital program. We are seeing improvement…
California Conventional Exploration Major Producing World Class Province Basins 35+ Billion BOE discovered 5 of top 12 U.S. oil fields 2 Billion BOE Significant Remaining Potential Large undiscovered resources Sacramento Multiple…
California Field Sizes Discovery Play High Potential Bread &…
California Unconventional Shale Program Multi-year inventory of drill sites in CA, many of which are both outside of Elk Hills proper & the Kern County Discovery Area Expect to drill 80+ shale wells outside Elk Hills proper, and 140…
Permian Basin Overview Approximately 1.2 billion BOE of proved reserves at year end 2010 2011 production of 198,000 boe/d Largest oil producer in Permian (15% net share of total) Largest operator in Permian (of 1,500+ operators)…
Permian Basin Capital Program Our rig count at year-end 2011 In the Permian operations, we was 23; expect to spend about 20% of our total capital. We expect our rig count to ramp up during the year to around 27 rigs by year end;…
Permian EOR Opportunities Permian properties 7.8 BBO Net Remaining initially had 11.9 BBO net in place 3P Reserves 4.1 BBO have been produced, 0.8 BBO leaving 7.8 BBO net EOR Likely remaining 1.4 BBO 4.6 BBO 1.0 BBO…
Midcontinent and Other Capital Program 2011 production of 92,000 boe/d; In the Midcontinent and Other Oxy holds over 2.4 mm net acres in operations, we plan to spend about the midcontinent region; 14% of our total capital program. In…
International Development and, Exploration Capital Program The Al Hosn Shah gas project will Total international development continue to increase spending in capital will be about 30% of the 2012 as originally planned, making up…
Abu Dhabi Al Hosn Gas Project (Shah Field) Shah Gas Field one of the largest in the Middle East; Oxy holds a 40% participating interest under a 30-year contract; The project involves development of high-sulfur content reservoirs…
Libya Operations Oxys 2011 and 2010 production in Libya was approximately 4 mboe/d and 13 mboe/d, respectively; Mediterranean Sea Tripoli We expect modest increases to our capital program this year in Libya Benghazi compared to…
Iraq The Zubair Field Oxy and its partners signed a 30-year contract with the South Oil Company of Iraq to develop the Zubair Field; Oxy has a 23.44% interest in this Iraq Iran contract; Oxys share of production was 7 mboe/d in…
Oxy Oman Mukhaizna Project World Class Steam flood project; UAE Gulf of Oman 2 B bo ROIP; Safah Discovered in 1975 in South Central Oman; 9 Block 62 27 Muscat Oxy assumed operation 62 September 1, 2005 at 8,500 b/d; Saudi…
Oxy Oman Gross Production Growth Mboepd 32
Cash Flow Priorities 1. Base/Maintenance Capital 2. Dividends 3. Growth Capital 4. Acquisitions 5. Share Repurchase 33
Summary 2011 Cash Flow Free cash flow from continuing operations after capex and dividends, but before acquisition and debt activity, was about 3.4 billion. ( in millions) Cash Flow From Operations Shah - 500 12,300…
Acquisition Strategy Companys core business is acquiring assets that can provide future growth through improved recovery. Foreign contracts Domestic add-ons Small incremental additions to production in short term Generate returns of…
Oxy Investment Attributes 5 - 8% base annual production growth Opportunity for additional volume growth Returns on invested capital significantly in excess of Companys cost of capital Annual increases in dividends Significant…
Creating Shareholder Value Oxys Shareholder Equity versus Equity Market Value A History of Generating Shareholder Value Change in Equity Market Value Market Value per of Equity Retained ( in millions) Change in Shareholder…
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