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PENNZOIL REPORTS THIRD QUARTER RESULTS

 HOUSTON, Oct. 27 /PRNewswire/ -- James L. Pate, president and chief executive officer of Pennzoil Co. (NYSE: PZL), announced higher operating results in three of Pennzoil's four operating segments.
 "Pennzoil reported operating income of $103.9 million for the third quarter of 1993 compared to $72.6 million in 1992. The results reflect higher operating results from Pennzoil's oil and gas, motor oil and automotive products, and franchise operations, as well as a $12.8 million pretax gain on the sale of certain oil and gas properties," he said.
 "Even with this significant improvement in operating income," Pate said, "two previously announced one-time charges reduced net income, resulting in a third quarter net loss of $1.6 million, or $0.04 per share, compared to net income of $10.5 million, or $0.26 per share, for the third quarter last year."
 The previously announced charges included:
 -- an after-tax charge of $13.7 million, or $0.33 per share, for costs associated with the early retirement of high coupon debt; and
 -- a non-cash charge of approximately $16 million, or $0.38 per share, to adjust deferred income tax liabilities and assets for the effect of the increase in corporate income tax rates.
 Excluding the above mentioned pretax gain and one-time charges, Pennzoil's 1993 third quarter results were $19.8 million, or $0.48 per share, compared to $5.4 million, or $0.14 per share, for the same period last year.
 For the nine month period ended Sept. 30, 1993, Pennzoil reported net income of $49.4 million, or $1.21 per share, which included an additional after-tax charge of $4.7 million, or $0.12 per share, related to early retirements of high coupon debt during the first six months of 1993 and a $10.5 million pretax gain on the sale of Pogo Producing Co. stock. Net income for the comparable 1992 period was $126.3 million, or $3.12 per share, and includes an increase in net income of $115.7 million, or $2.85 per share, related to the adoption of SFAS No. 109, "Accounting for Income Taxes," effective as of Jan. 1, 1992.
 Revenues for the third quarter of 1993 were $655.9 million versus $599.9 million for the same period last year. For the nine months ended Sept. 30, 1993, revenues were $1.992 billion versus $1.736 billion for the same period in 1992.
 Pate said, "Excluding the $12.8 million pretax gain on the sale of oil and gas properties, operating income for Pennzoil's oil and gas segment was up about 50 percent primarily from increased crude oil, natural gas and liquids production, and higher natural gas prices. The increase in production resulted from the properties acquired from Chevron Corp. in a stock-for-stock exchange in October 1992. The higher gas realizations were offset by lower crude oil and liquids prices, down $3.53 per barrel compared to the third quarter in 1992.
 "Motor oil, specialty products, and refiner's margins benefited from the lower crude oil prices, resulting in a 39 percent increase in operating income for the motor oil and automotive products segment," he noted.
 Pate said that franchise operations showed positive operating income against a loss for the same quarter a year ago. "The improved performance of Jiffy Lube was attributed to lower selling, general and administrative expenses, and higher company store operating results."
 "The sulphur segment reported a loss in operating income due to lower sulphur prices and lower sales volumes," Pate said. Pennzoil's sulphur division recently announced plans to utilize a new technology to reduce its costs of mining sulphur. As a result of changes to its mining process and market conditions, Pennzoil Sulphur has said it will eliminate approximately 110 jobs within the next few weeks.
 PENNZOIL CO.
 (In thousands, except per share amounts)
 (unaudited)
 Three Months Ended
 Sept. 30
 1993 1992
 REVENUES
 Oil and Gas $ 218,415 $ 125,383
 Motor Oil & Automotive Products 387,889 401,207
 Franchise Operations 56,085 47,867
 Sulphur 17,977 34,750
 Other 16,803 29,128
 Intersegment Sales (41,302) (38,422)
 Total Revenues $ 655,867 $ 599,913
 OPERATING INCOME (LOSS)
 Oil and Gas $ 57,560 $ 30,076
 Motor Oil & Automotive Products 33,971 24,490
 Franchise Operations 1,459 (5,433)
 Sulphur (6,071) (1,830)
 Other 17,015 25,263
 Total Operating Income 103,934 72,566
 Corporate Administrative Expenses 17,167 16,506
 Interest Expenses, net 45,400 54,915
 Income (Loss) Before Income Tax 41,367 1,145
 Income Tax (Benefit) 29,331 (5,164)
 Income (Loss) From Continuing Operations 12,036 6,309
 Discontinued Operations
 Income from operations, net of taxes -- 4,157
 Income Before Extraordinary Items and Cumulative
 Effect of Change in Accounting Principle 12,036 10,466
 Extraordinary Items (13,656) --
 Cumulative Effect of Change in Accounting
 Principle -- --
 NET INCOME (LOSS) $ (1,620) $ 10,466
 EARNINGS (LOSS) PER SHARE
 Continuing Operations $ 0.29 $ 0.16
 Discontinued Operations -- 0.10
 Extraordinary Items (0.33) --
 Cumulative Effect of Change in Accounting
 Principle -- --
 TOTAL $ (0.04) $ 0.26
 AVERAGE SHARES OUTSTANDING 41,315 40,613
 NUMBER OF SHARES OUTSTANDING 45,852 40,642
 PENNZOIL CO.
 (In thousands, except per share amounts)
 (unaudited)
 Nine Months Ended
 Sept. 30
 1993 1992
 REVENUES
 Oil and Gas $ 663,223 $ 355,128
 Motor Oil & Automotive Products 1,159,714 1,157,517
 Franchise Operations 161,687 124,877
 Sulphur 55,611 121,907
 Other 65,226 88,940
 Intersegment Sales (113,876) (111,938)
 Total Revenues $ 1,991,585 $ 1,736,431
 OPERATING INCOME (LOSS)
 Oil and Gas $ 176,838 $ 68,400
 Motor Oil & Automotive Products 82,465 65,436
 Franchise Operations 3,673 (12,329)
 Sulphur (11,697) 964
 Other 61,346 71,020
 Total Operating Income 312,625 193,491
 Corporate Administrative Expenses 50,048 49,369
 Interest Expenses, net 141,392 167,651
 Income (Loss) Before Income Tax 121,185 (23,529)
 Income Tax (Benefit) 53,385 (25,188)
 Income (Loss) From Continuing Operations 67,800 1,659
 Discontinued Operations
 Income from operations, net of taxes -- 8,986
 Income Before Extraordinary Items and
 Cumulative Effect of Change in Accounting
 Principle 67,800 10,645
 Extraordinary Items (18,380) --
 Cumulative Effect of Change in Accounting
 Principle -- 115,703
 NET INCOME $ 49,420 $ 126,348
 EARNINGS (LOSS) PER SHARE
 Continuing Operations $ 1.66 $ 0.05
 Discontinued Operations -- 0.22
 Extraordinary Items (0.45) --
 Cumulative Effect of Change in Accounting
 Principle -- 2.85
 TOTAL $ 1.21 $ 3.12
 AVERAGE SHARES OUTSTANDING 40,945 40,552
 NUMBER OF SHARES OUTSTANDING 45,852 40,642
 OPERATING HIGHLIGHTS
 (Unaudited)
 Three Months Ended
 Sept. 30
 1993 1992
 OPERATING DATA
 OIL AND GAS
 Net production
 Crude oil, condensate and natural
 gas liquids (barrels per day) 63,796 33,810
 Natural gas produced for sale
 (Mcf per day) 619,689 392,348
 Weighted average prices
 Crude oil, condensate and natural
 gas liquids (per barrel) $ 14.30 $ 17.83
 Natural gas (per Mcf) $ 2.05 $ 1.77
 MOTOR OIL & AUTOMOTIVE PRODUCTS
 Sales (barrels per day)
 Gasoline and naphtha 25,772 25,039
 Distillates and gas oils 29,141 27,598
 Lubricating oil and other
 specialty products 24,068 22,939
 Residual fuel oils 2,350 2,313
 Total Sales (barrels per day) 81,331 77,889
 Raw materials processed
 (barrels per day) 63,036 63,470
 Refining capacity
 (barrels per day) 70,700 70,700
 FRANCHISE OPERATIONS
 Domestic system-wide sales
 (in thousands) $ 140,985 $ 128,085
 Centers open (U.S.) 1,063 1,038
 SULPHUR
 Sales (in thousands of long tons) 257 393
 Average Green Markets Tampa Recovered
 Contract Price Range
 (per long ton) (A) $ 59.00-65.00 $ 88.00-90.00
 (A) This is a representative market price and does not necessarily reflect what is received by Pennzoil.
 Nine Months Ended
 Sept. 30
 OPERATING DATA 1993 1992
 OIL AND GAS
 Net production
 Crude oil, condensate and natural
 gas liquids (barrels per day) 63,462 34,168
 Natural gas produced for sale
 (Mcf per day) 657,561 409,115
 Weighted average prices
 Crude oil, condensate and natural
 gas liquids (per barrel) $ 15.63 $ 16.92
 Natural gas (per Mcf) $ 2.01 $ 1.57
 MOTOR OIL & AUTOMOTIVE PRODUCTS
 Sales (barrels per day)
 Gasoline and naphtha 25,710 23,879
 Distillates and gas oils 29,612 29,219
 Lubricating oil and other
 specialty products 23,516 23,393
 Residual fuel oils 2,319 1,836
 Total Sales (barrels per day) 81,157 78,327
 Raw materials processed
 (barrels per day) 61,698 58,086
 Refining capacity
 (barrels per day) 70,700 70,700
 FRANCHISE OPERATIONS
 Domestic system-wide sales
 (in thousands) $ 399,262 $ 375,237
 Centers open (U.S.) 1,063 1,038
 SULPHUR
 Sales (in thousands of long tons) 762 1,377
 Average Green Markets Tampa Recovered
 Contract Price Range
 (per long ton) (A) $ 65.00-69.00 $88.00-90.00
 (A) This is a representative market price and does not necessarily reflect what is received by Pennzoil.
 -0- 10/27/93
 /CONTACT: Robert Harper of Pennzoil Co., 713-546-8536/
 (PZL)


CO: Pennzoil Co. ST: Texas IN: OIL SU: ERN

PS -- NY038 -- 7206 10/27/93 10:57 EDT
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Date:Oct 27, 1993
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