Canadian Occidental Petroleum Ltd. reports record-second quarter results; increase in the 1996 capital program; acquisition of an exploration concession in Indonesia; increased activity in Vietnam.CALGARY Calgary (kăl`gərē), city (1991 pop. 710,677), S Alta., Canada, at the confluence of the Bow and Elbow rivers. The largest city in Alberta and the fastest-growing major city in Canada, Calgary is a corporate, transportation, and financial , Alberta--(BUSINESS WIRE)--July 26, 1996-- Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. Occidental Petroleum Occidental Petroleum Corporation ("Oxy") NYSE: OXY is an international oil and gas exploration and production company with operations in the United States, Middle East/North Africa and Latin America regions. Ltd. reports cash flow of $175 million ($1.29 per common share) for the quarter ended June June: see month. 30, 1996, a 5% increase compared to 1995 and a new record for the second quarter. Net income also set a second quarter record totalling $47 million ($0.35 per common share) compared to $41 million ($0.31 per common share) during the comparable period of 1995. For the first six months, cash flow totalled $363 million ($2.68 per common share) and net income was $97 million ($0.72 per common share) compared to $318 million ($2.36 per common share) and $71 million ($0.53 per common share) respectively during the first six months of 1995. Crude oil production averaged 138,000 barrels per day Barrels per day (abbreviated BPD, bbl/d, bpd, bd or b/d) is a measurement used to describe the amount of crude oil (measured in barrels) produced or consumed by an entity in one day. in the second quarter of 1995. Natural gas production averaged 227 million cubic feet per day, compared to 223 million cubic feet per day for the compared period of 1995. In response to a growing portfolio of opportunities, the Board of Directors has approved a $53 million increase in the 1996 capital program to $660 million. The major beneficiary beneficiary Person or entity (e.g., a charity or estate) that receives a benefit from something (e.g., a trust, life-insurance policy, or contract). A primary beneficiary receives proceeds from a trust or insurance policy before any other. is Western Canada
Western Canada, commonly referred to as the West where investment will increase by $50 million to $151 million. Approximately 60% of the increase will be allocated to identified development projects expected to add 14 million barrels equivalent of reserves and to increase daily production by approximately 6,700 barrels equivalent by the end of 1996. The balance will be used to pursue exploration opportunities in the vicinity of core operations in north east British Columbia British Columbia, province (2001 pop. 3,907,738), 366,255 sq mi (948,600 sq km), including 6,976 sq mi (18,068 sq km) of water surface, W Canada. Geography , Alberta Alberta (ălbûr`tə), province (2001 pop. 2,974,807), 255,285 sq mi (661,188 sq km), including 6,485 sq mi (16,796 sq km) of water surface, W Canada. and Saskatchewan Saskatchewan, province, Canada Saskatchewan (səskăch`əwən, –wän', săs'–), province (2001 pop. 978,933), 251,700 sq mi (651,903 sq km), W Canada. . The North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. Division is an increasingly significant contributor to corporate results. In Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of , several exploration successes during the quarter discovered significant new pools in west central Saskatchewan and the Peace River area of north east British Columbia. At Plover plover (plŭv`ər), common name for some members of the large family Charadriidae, shore birds, small to medium in size, found in ice-free lands all over the world. in west central Saskatchewan, two wells were drilled encountering 36 and 24 feet of net heavy oil pay respectively, delineating significantly the extent of this Bakken pool. CanadianOxy has a 50% interest in these wells. At West Stoddart Stoddart is a surname for
Newfoundland, breed of massive, powerful working dog developed in Newfoundland, probably in the 17th cent., and later perfected in England. It stands from 25 to 28 in. (63.5–71. . The well produced water and was abandoned. However, the area remains prospective and drilling results are being assessed to determine future activity in the area. During the quarter, the Company made a number of acquisitions including a 32.5% interest in the Findley pool in the Alberta foothills adding 8 BCF BCF Billion Cubic Feet BCF Bioconcentration Factor BCF British Chess Federation BCF British Coatings Federation BCF Breast Cancer Fund BCF Bank Credit Facility BCF Bulked Continuous Filament BCF British Cycling Federation BCF Boeing Converted Freighter of proven undeveloped gas reserves. It also purchases 34,000 acres of undeveloped crown and freehold Freehold, borough, United States Freehold, borough (1990 pop. 10,742), seat of Monmouth co., E central N.J.; settled c.1650, called Monmouth Courthouse (1715–1801), inc. as a town 1869, as a borough 1919. land in south east Saskatchewan where it has commenced a multi-well drilling program. CXY Energy remains focused on the shallow offshore of the Gulf of Mexico Noun 1. Gulf of Mexico - an arm of the Atlantic to the south of the United States and to the east of Mexico Golfo de Mexico Atlantic, Atlantic Ocean - the 2nd largest ocean; separates North and South America on the west from Europe and Africa on the east . At Eugene Island Eugene Island is a submerged mountain 70-85 miles off the Louisiana coast in the Gulf of Mexico. The nearby oil field Eugene Island 330 is best known for its unusual depletion profile. According to the article "Sustainable Oil?" by Chris Bennett WorldNetDaily. , CXY drilled exploitation wells on Blocks 257 and 259 encountering 43 feet and 91 feet of net oil and gas pay respectively. The Block 259 well was tied-in tied-in a conformation defect in an animal in which a limb is perceptibly thinner at one point, e.g. tied-in below the knee, or below the hock. together with a well drilled int he first quarter and the two are currently producing approximately 13.5 cubic feet of gas and 750 barrels of liquids per day. CXY has a 100% interest in these blocks and expects to drill a total nine wells in the Eugene Island area in 1996. CXY also drilled an exploitation well at Drakes Bay
Drake's Bay is a small bay on the coast of northern California in the United States, approximately 30 miles (48 km) northwest of San Francisco at approximately 38 degrees North latitude. encountering 53 feet of net pay. CXY has a 50% interest in this well which was production tested at 5 million cubic feet of gas per day. The International Division is continuing to build its asset base, setting the stage for future growth. CanadianOxy has reached agreement with Gulf Canada Resources Limited to explore for natural gas in the Merangin Block in South Sumatra South Sumatra or Sumatera Selatan is a province of Indonesia. It is on the island of Sumatra, and borders the provinces of Lampung to the south, Bengkulu to the west, and Jambi to the north. , Indonesia Indonesia (ĭn'dənē`zhə), officially Republic of Indonesia, republic (2005 est. pop. 241,974,000), c.735,000 sq mi (1,903,650 sq km), SE Asia, in the Malay Archipelago. . Subject to approval by Pertamina PERTAMINA Perusahaan Pertambangan Minyak Dan Gas Bumi Negara (the Indonesian National Oil Company), a CanadianOxy subsidiary will earn a 40% working interest in the 981,000 acre Merangin Block Production Sharing Contract in exchange for funding a deep gas exploration well to be drilled in 1997 and participating in a 650-kilometer seismic acquisition program being conducted this year. Participation in the Merangin Block provides CanadianOxy with exposure to large, moderate risk gas prospects in partnership with an operator with an excellent track record in the South Sumatra gas basin. The Merangin Block is located adjacent to Asamera's Corridor and South Jambi Jambi or Djambi (both: jäm`bē), city (1990 est. pop. 340,066), SE Sumatra, capital of Jambi prov., Indonesia, a port at the head of navigation on the Hari River. blocks, the sites of significant recent gas discoveries. Offshore Vietnam Vietnam (vēĕt`näm), officially Socialist Republic of Vietnam, republic (v), 128,400 sq mi (332,642 sq km), Southeast Asia. Occupying the eastern coastline of the Southeast Asian peninsula, Vietnam is bounded by China on the north, by Laos , the Division drilled its first exploration well on Block 12W. CanadianOxy's subsidiary, Canadian Petroleum Vietnam Ltd., has a 50% interest and is operator of the Block. CanadianOxy's partners in the Block are Teikokou Oil (Vietnam) Co., Ltd. (30% interest) and Sodec Con Son Co., Ltd. (20% interest). The Vietnam Oil & Gas Corporation (PetroVietnam) has the option to acquire a 15% working interest in Block 12W. Log analysis indicates the presence of hydrocarbons hydrocarbons (hīˈ·drō·kärˑ·b  nz),n. and a drill stem test In oil and natural gas extraction, the drill stem includes the drill pipe, drill collars, bottomhole assembly, and drill bit. A drill stem test (DST) is a procedure for testing the surrounding geological formation through the drill pipe. flowed 24 million cubic feet of gas and 840 barrels of condensate condensate, matter in the form of a gas of atoms, molecules, or elementary particles that have been so chilled that their motion is virtually halted and as a consequence they lose their separate identities and merge into a single entity. per day. The flow rate was limited by the 3 1/2 inch tubing used in testing the well. The test results are currently being evaluated. In Yemen, the Division drilled the Sunah-9 appraisal well during the quarter. Although the well was not productive in the Shuqra zone, it will be completed for production in the Qishn zone. The Division plans collect an additional 88 square kilometers of three dimensional seismic information and to follow up with two more Shuqra zone, it will be completed for production in the Qishn zone. The Division plans to collect an additional 88 square kilometers of three dimensional seismic information and to follow up with two more Shuqra appraisal wells. Higher sodium chlorate sodium chlorate n. A colorless crystalline compound, NaClO3, used as a bleaching and oxidizing agent and in explosives. sodium chlorate Noun volumes resulting from capacity expansions and acquisitions completed in 1995 enabled the Chemicals Division to report strong operating performance despite weak pulp mill A pulp mill is a manufacturing facility that converts wood chips or other plant fiber source into a thick fiber board which can be shipped to a paper mill for further processing. operating rates Operating rate The percentage of total production capacity of a company, industry, or country that is being used. operating rate The portion of capacity at which a business operates. and paper markets. Sodium chlorate sales were 27% higher than one year ago leading to a 17% increase in cash flow to $21 million and a 15% increase in operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. to $15 million. David A. Hentschel, President and Chief Executive Officer commented on the quarter, "I'm very pleased with the results from the second quarter. Opportunities such as Block 12W, offshore Vietnam, and the Merangin Block in Indonesia, combined with the successes in Canada and the U.S. are adding tangible value for shareholders. I expect that when we add it all up in December, we'll be looking at an outstanding year in all respects." The Board of Directors has declared the regular quarterly dividend of $0.075 per common share, payable October 1, 1996 to shareholders of record on September 6, 1996. -0-
July 26, 1996
FINANCIAL HIGHLIGHTS
(Amounts in millions of Canadian dollars except per share data)
Three Months Six Months
-------------------------------------
1996 1995 1996 1995
-----------------------------------
Net Sales $318 $306 $637 $584
Net Income 47 41 97 71
Per Common Share 0.35 0.31 0.72 0.53
Funds Flow from Operations 175 167 363 318
Per Common Share 1.29 1.24 2.68 2.36
Capital Expenditures and
Acquisitions 125 126 299 189
Net Debt 561 677 561 677
BUSINESS SEGMENTS INFORMATION
(Amounts in millions of Canadian dollars)
Three Months Six Months
-------------------------------------
1996 1995 1996 1995
-----------------------------------
Operating Profit
Oil and Gas
North
America
Canada $7 $6 $17 $13
United States 16 10 41 21
Alternate Fuels 4 10 12 12
---------------------------------
27 26 70 46
---------------------------------
International
Republic of Yemen 67 57 113 103
North Sea (3) 3 2 4
Ecuador 2 2 4 3
Other (8) (7) (13) (14)
--------------------------------
58 55 106 96
--------------------------------
Total Oil and Gas 85 81 176 142
Chemicals 15 13 29 26
---------------------------------
100 94 205 168
Corporate Expenses and Interest (21) (19) (41) (41)
Income Taxes (32) (34) (67) (56)
---------------------------------
Net Income $47 $41 $97 $71
-----------------------------------
-----------------------------------
BUSINESS SEGMENTS INFORMATION (Amounts in millions of Canadian dollars)
Three Months Six Months
1996 1995 1996 1995
______________ ___________
Funds Flow from Operations
Oil and Gas
North America
Canada $23 $18 $46 $37
United States 35 23 82 49
Alternate Fuels 7 13 18 17
______________ ___________
65 54 146 103
______________ ___________
International
Republic of Yemen 119 123 225 227
North Sea 8 14 23 31
Ecuador 3 2 5 4
Other (2) (4) (3) (6)
_____________ ____________
128 135 250 256
_____________ ____________
Total Oil and Gas 193 189 396 359
Chemicals 21 18 41 35
Corporate Expenses and Interest (16) (20) (33) (39)
Income Taxes (23) (20) (41) (37)
_____________ ____________
Total $175 $167 $363 $318
_____________ ____________
PRODUCTION HIGHLIGHTS
Three Months Six Months
___________________________
1996 1995 1996 1995
__________________________
Natural Gas (million cubic feet per day)
North America
Canada 126.5 141.9 127.4 136.4
United States 72.3 40.5 70.2 49.1
International
North Sea 27.7 40.8 37.2 45.3
______________ _____________
226.5 223.2 234.8 230.8
______________ _____________
Crude Oil, Condensate and Natural Gas Liquids
(thousand barrels per day)
North America
Canada 13.7 12.8 12.8 12.4
United States 12.2 10.7 13.6 11.2
Alternate Fuels 13.3 15.3 13.8 13.8
International
Republic of Yemen 94.7 91.4 94.0 88.2
South America 4.0 4.8 4.1 4.6
North Sea 0.2 0.2 0.2 0.2
_____________ _____________
Total 138.1 135.2 138.5 130.4
_____________ ______________
AVERAGE COMMODITY PRICES
(Amounts in Canadian dollars except WTI)
Three Months Six Months
---------------------------------
1996 1995 1996 1995
--------------------------------
Natural Gas (per thousand cubic feet)
International
North Sea $4.19 $4.52 $4.23 $4.51
North
America
Canada 1.39 1.16 1.48 1.16
United States 3.40 2.68 4.23 2.53
Corporate Average 2.40 2.07 2.73 2.10
Crude Oil (per barrel)
International
Republic of Yemen $25.98 $24.44 $25.46 $23.84
South America 15.68 14.19 15.48 14.26
North
America
Canada 24.23 21.88 22.80 21.75
United States 29.49 25.30 27.76 24.79
Corporate Average 25.82 23.88 25.14 23.36 Synthetic Crude Oil (per barrel)$28.57 $25.13 $27.19 $24.77 WTI Average (U.S. dollars) $21.61 $19.34 $20.58 $18.85 CONTACT: Canadian Occidental Petroleum Ltd. Mark Houser, (403) 234-2022 John McWilliams, (403) 234-6729 |
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