LOS ANGELES, May 3, 1999 - (PRIMEZONE) -- Occidental Petroleum Corporation (NYSE:OXY) said today that it has completed formation of Oxy Vinyls, LP, (OxyVinyls), a joint venture with The Geon Company combining their polyvinyl chloride (PVC) businesses and creating North America's largest producer of PVC resins.
The joint venture is expected to reduce the companies' operating costs by approximately $80 million annually.
Occidental's chemical subsidiary, OxyChem, owns 76 percent of OxyVinyls, and Geon owns 24 percent.
The joint venture has annual capacities of 4.2 billion pounds of PVC and 4.8 billion pounds of vinyl chloride monomer (VCM).
Dr. Ray R. Irani, Occidental's chairman and chief executive officer, said, "This alliance is a further step in our strategy to grow Occidental and to improve continuing earnings and return on assets. Recent improvements in PVC demand and prices should substantially benefit OxyVinyls."
OxyVinyls will be comprised of:
-- OxyChem's PVC resin plant in Pasadena, Texas; its VCM plant in
Deer Park, Texas; its 50 percent interest in the OxyMar VCM plant
in Ingleside, Texas, and some related facilities.
-- Five Geon PVC resin plants in Deer Park, Texas; Louisville, Kentucky;
Pedricktown, New Jersey, and, in Canada, at Niagara Falls, Ontario,
and Scotford, Alberta, and its VCM plant in LaPorte, Texas.
Geon entered into a long-term PVC resin purchase agreement with OxyVinyls, and Geon and OxyChem entered long-term VCM purchase agreements to serve their specialty resin business.
John L. Hurst, who was OxyChem's executive vice president for manufacturing and engineering, is chief executive officer of OxyVinyls, which is governed by a six-member board with three representatives each from Occidental and Geon.
In addition, a powder compounding products joint venture was formed that is owned 90 percent by Geon and 10 percent by Occidental.
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.