Occidental Petroleum Corporation · NYSE:OXY
Occidental Petroleum — Q2 2010 Earnings Presentation
18 slides from Occidental Petroleum's earnings presentation, Jul 27, 2010
Slide 1: Second Quarter 2010 Earnings Conference Call
EXHIBIT 99.4 Occidental Petroleum Corporation Second Quarter 2010 Earnings Conference Call July 27, 2010 1
Slide 2: Second Quarter 2010 Earnings - Highlights
Second Quarter 2010 Earnings - Highlights • Core Results - $1.1 Billion vs. $689 Million in 2Q09 – Core EPS $1.31 (diluted) vs. $0.85 in 2Q09. • Net Income - $1.1 Billion vs. $682 Million in 2Q09 – EPS $1.31 (diluted) vs. $0.84 in 2Q09. 2 2
Slide 3: Oil & Gas Segment Variance Analysis - 2Q10 vs. 2Q09
Second Quarter 2010 Earnings - Oil & Gas Segment Variance Analysis - 2Q10 vs. 2Q09 • Core Results for 2Q10 of $1.853 B vs. $1.083 B in 2Q09 – Improvement in 2010 driven mostly by higher commodity prices with additional contributions from higher volumes. Partially offsetting these gains were higher D
Slide 4: Oil & Gas Segment
Second Quarter 2010 Earnings - Oil & Gas Segment 2Q10 2Q09 Reported Segment Earnings ($ mm) $1,853 $1,083 WTI Oil Price ($/bbl) $78.03 $59.62 NYMEX Gas Price ($/mcf) $4.18 $3.83 Oxy’s Realized Prices Worldwide Oil ($/bbl) $72.13 $52.97 US Natural Gas ($/mcf) $4.19 $2.87 4 4
Slide 5: Oil & Gas Segment - Production Volumes
Second Quarter 2010 Earnings - Oil & Gas Segment 2Q10 2Q09 Oil and Gas Production Volumes (mboe/d) 743 717 – Year-over-year increase of over 3.5%. • 2Q10 production was lower than our guidance due primarily to shortfalls in California and adjustments resulting from the mechanics of PSCs in the Middl
Slide 6: Oil & Gas Segment - Cash Production Costs and Taxes
Second Quarter 2010 Earnings - Oil & Gas Segment - Cash Production Costs and Taxes • Oil and gas cash production costs, excluding production and property taxes, were $9.90 per boe for 1H10. – 2Q10 per boe production costs were slightly lower than this figure. – Full-year 2009 costs were $9.37 a boe.
Slide 7: Chemical Segment Variance Analysis - 2Q10 vs. 2Q09
Second Quarter 2010 Earnings - Chemical Segment Variance Analysis - 2Q10 vs. 2Q09 • Core Results for 2Q10 of $108 mm vs. $115 mm in 2Q09 – Results reflect improvement from the first quarter 2010 in margins and volumes across most product lines. ($ in millions) $151 $125 $25 $115 $8 $108 2Q10 Sales S
Slide 8: Midstream Segment Variance Analysis - 2Q10 vs. 2Q09
Second Quarter 2010 Earnings - Midstream Segment Variance Analysis - 2Q10 vs. 2Q09 • Core Results for 2Q10 of $13 mm vs. $63 mm in 2Q09 – The decrease in earnings was mainly due to a pre-tax $104 million ($0.07 after-tax per diluted share) loss at Phibro, the bulk of which resulted from marking its
Slide 9: Six Months Results & Capital Spending
Second Quarter 2010 Earnings - Six Months Results & Capital Spending YTD2010 YTD2009 • Net Income ($ mm) $2,127 $1,050 • EPS (diluted) $2.61 $1.29 • Capital spending for 2Q10 was about $865 million and $1.7 billion for 1H10. – Year to-date capital expenditures by segment were 81% in Oil and Gas, 13%
Slide 10: Cash Flow 2010 YTD
Second Quarter 2010 Earnings - Cash Flow 2010 YTD – Free Cash Flow for 1H10 after capex and dividends but before acquisition activity and debt retirements was about $2.1 billion. $5,500 $1,700 ($ in millions) $760 Cash Flow From $540 Operations $4,300 $300 $100 $2,300 Beginning Cash $1,200 12/31/09
Slide 11: Shares Outstanding and Debt
Second Quarter 2010 Earnings - Shares Outstanding and Debt Shares Outstanding (mm) YTD10 6/30/10 Weighted Average Basic 812.3 Weighted Average Diluted 813.7 Basic Shares Outstanding 812.8 Diluted Shares Outstanding 814.2 6/30/1012/31/09 Debt/Capital 8% 9% 11 11
Slide 12: Oil and Gas Production - 3Q10 Outlook
Second Quarter 2010 Earnings - Oil and Gas Production - 3Q10 Outlook • We expect oil and gas production and sales volumes to be in the range of 750 to 760 mboe/d at about current oil prices. • Volume increases in 3Q10 are expected to come from California, Oman's Mukhaizna field and Dolphin. 12 12
Slide 13: 3Q10 Outlook - Commodity Price Sensitivity
Second Quarter 2010 Earnings - 3Q10 Outlook • Commodity Price Sensitivity - Earnings – At current market prices, a $1.00 per barrel change in oil prices impacts oil and gas quarterly earnings before income taxes by about $37 mm; – A swing of $0.50 per mm BTU in domestic gas prices has a $30 mm impac
Slide 14: 3Q10 Outlook - Chemical Segment
Second Quarter 2010 Earnings - 3Q10 Outlook • For the Chemical segment: – Modest volume and margin improvement is expected over 2Q10 levels for chlor-alkali and vinyl products. – The Chemical segment is expected to provide earnings for 3Q10 of about $125 million. – While the domestic market continue
Slide 15: Acquisitions - 3Q10 Outlook
Second Quarter 2010 Earnings - Acquisitions - 3Q10 Outlook • We have recently negotiated a number of asset acquisitions in the Oil and Gas business that in aggregate would be about $1.5 billion. – These expected acquisitions are mainly from private individuals largely in the gassier parts of the Per
Slide 16: California Update - Conventional Drilling
Second Quarter 2010 Earnings - California Update • Conventional Drilling Opportunities: – During 1H10, we drilled 6 conventional exploration and extension wells in California. – Of these, 5 were outside of the Kern County Discovery area. – Two of these new wells are currently being tested. – In 2H10
Slide 17: California Update - Unconventional Drilling
Second Quarter 2010 Earnings - California Update • Unconventional Drilling Opportunities: – We also drilled 7 unconventional exploration wells in 1H10, of which 2 were successful and 2 are being tested. – We plan to drill 15 additional unconventional exploration wells during 2H10. – We have also dri
Slide 18: 18
18 18