LOS ANGELES, May 27, 1999 (PRIMEZONE) -- Occidental Petroleum Corporation (NYSE: OXY) and Unocal Corporation (NYSE: UCL) today announced agreements under which Occidental will acquire Unocal's holdings in Yemen and Unocal will acquire Occidental's properties in Bangladesh. The transactions are expected to be completed in the third quarter.
Dr. Ray R. Irani, Occidental's chairman and chief executive officer, said, "These agreements strengthen our significant presence in Yemen and are an important part of our strategy to build large-scale assets in each of our core areas that will enable us to achieve economies of scale, drive down costs and improve profitability."
Under the Share Purchase Agreements, Occidental will acquire 100 percent of the stock in Unocal Yemen Ltd., whose properties are adjacent to Occidental's existing holdings in the Masila Block. Occidental also will receive other considerations.
The assets of Unocal Yemen Ltd. include a 28.57 percent working interest in the production-sharing contract of the East Shabwa contract area, which has three producing fields -- Kharir, Atuf Northwest and Wadi Taribah. The fields have current gross production of approximately 15,000 barrels of oil per day. Production should continue to increase as development drilling proceeds in the producing fields and as additional structures in the block are tested. The block is expected to produce an average of 25,000 barrels of oil per day next year.
Occidental has a 38 percent working interest in the Masila Block. Gross production in the Masila Block continues to increase and is now up to 214,000 barrels of oil per day. Last year, Occidental increased its holdings in Yemen as the result of an asset swap with Royal Dutch/Shell. Occidental also has a 29 percent equity interest in Canadian Occidental Petroleum Ltd., which is the operator of the Masila Block.
Unocal will acquire 100 percent of the stock in Occidental of Bangladesh Ltd. and Occidental Exploration of Bangladesh Ltd., which hold a 50 percent working interest in two production-sharing contracts for Blocks 12, 13 and 14 that cover 3.4 million acres in northeast Bangladesh. Current production from the Jalalabad field is 60-100 million cubic feet of gas per day.
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Note: This press release may contain forward-looking statements that reflect management's expectations and are based upon data available at the time. Actual results are subject to future events and uncertainties that could materially impact performance.