LOS ANGELES, April 25, 2003 (PRIMEZONE) -- Occidental Petroleum Corporation's (NYSE:OXY) chairman and chief executive officer, Dr. Ray R. Irani, told stockholders at the company's annual meeting that during the period 2000 through 2002, the company had achieved "top quartile results in virtually all of the key financial criteria used to measure comparative performance among our oil and gas industry peers."
"They include," Dr. Irani said, "profitability and free cash flow per barrel of oil equivalent (BOE) sold; return on equity; return on capital employed; and, most importantly, total return to stockholders."
"Occidental generated a total return to stockholders of 11 percent in 2002," said Dr. Irani. "By comparison, the Standard and Poor's 500 Index posted a negative total return of 22 percent and the Dow Jones Industrial Index companies recorded a composite negative return of 15 percent. In addition, our oil and gas competitors registered a combined negative return of 11 percent."
Occidental's worldwide oil and natural gas production increased by an average of 6.5 percent per year since 1999, with U.S. operations accounting for 63 percent of the company's total production in 2002. Occidental's average daily oil and gas production of 515,000 BOE per day in 2002 was the highest level achieved in the company's history.
"We are on our way to a new production record in 2003," Dr. Irani told the assembled stockholders. "And based on our forecast of 5 percent average annual growth that is tied to projects already under development, we are confident of setting new annual production records every year through 2006."
Dr. Irani attributed Occidental's ability to grow production and achieve top quartile financial performance to "our disciplined strategy that balances growth with profitability." He noted that for the period 2000 through 2002, Occidental was the industry leader in profitability and free cash flow per BOE while posting the lowest average oil and gas finding and development costs in the industry.
"While we're succeeding in keeping our replacement costs down," Dr. Irani said, "we're also dramatically increasing our reserves." At the end of 2002, Occidental's proven oil and gas reserves exceeded 2.3 billion BOE, the highest level in the company's history, with the U.S. accounting for 76 percent of the total.
Since year-end 2000 through March 31, 2003, Occidental has reduced total debt by 28 percent, from $6.4 billion to $4.6 billion, and lowered the debt to capitalization ratio from 57 percent to 41 percent. The debt level and the debt to capitalization ratio are at their lowest level in more than two decades.
Dr. Irani also pointed to the strategic alignment between the company's business performance and the commitment to providing a safe and healthy workplace for employees, serving as responsible stewards of the environment, being a good neighbor and maintaining the highest standards of ethical behavior.
In reviewing the company's safety programs, Dr. Irani said, "Our 2002 performance established a new company safety record with an Injury and Illness Rate of 0.62, which means, that on a statistical basis, Occidental had less than one injury per 100 workers for the entire year. We outperformed the oil and gas and chemical industries by a wide margin based on data from the U.S. Bureau of Labor Statistics." 2002 was the seventh consecutive year Occidental's rate has been less than one.
Noting that the issue of corporate governance was much in the news over the last 18 months, Dr. Irani said, "Institutional Shareholder Services and Standard and Poor's have given Occidental's corporate governance policies exceptionally high ratings."
Statements in this presentation that contain words such as "will" or "expect", or otherwise relate to the future, are forward-looking and involve risks and uncertainties that could significantly affect expected results. Factors that could cause results to differ materially include, but are not limited to: global commodity pricing fluctuations, and supply/demand considerations, for oil, gas and chemicals; higher-than-expected costs; and not successfully completing (or any material delay in) any expansion, capital expenditure, acquisition, or disposition. Occidental disclaims any obligation to update any forward-looking statements. -0-