Occidental Petroleum

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Occidental Petroleum Corporation

Type	Public (NYSE: OXY)
Founded	1920
Headquarters	Los Angeles, California
Key people	Ray R. Irani, Chairman, President and CEO
Industry	Oil and gas
Products	Oil, Natural gas, Petrochemicals
Revenue	US$20.21 billion (2008)
Net income	US$5.40 billion (2008)
Employees	8,886
Website	www.oxy.com

Occidental Petroleum Corporation (Oxy) NYSE: OXY is an international oil and gas exploration and production company with operations in the United States, the Middle East, North Africa, and South America. The company nickname “Oxy” began in 1964 in reference to Occidental’s NYSE stock ticker. Headquartered in Los Angeles, California, Oxy is the fourth largest U.S. oil and gas company, based on equity market capitalization. Oxy is the largest oil producer in Texas and the largest natural gas producer in California, with additional operations in Kansas, Oklahoma, Colorado and New Mexico.

Oxy's wholly-owned subsidiary, OxyChem, manufactures and markets chlor-alkali products and vinyls.

Contents 1 History 2 Operations 2.1 Oil and Gas Operations 2.2 Chemical Operations 3 Controversies 3.1 Involvement at Love Canal 3.2 Piper Alpha disaster 3.3 Caño Limón massacre 3.4 Recent opportunities and resistance 3.5 Outstanding lawsuits 3.6 The Greenmail case 3.7 Gore family ties 4 Environmental record 5 Businesses 6 References 7 External links

[edit] History

Oxy was founded in 1920. In 1957 Dr. Armand Hammer was elected president and CEO. In 1961, Oxy discovered California's second largest natural gas field in the Arbuckle area of the Sacramento basin at Lathrop. Over the next 10 years, Oxy expanded worldwide operations with efforts in Libya, Peru, Venezuela, Bolivia, Trinidad and the United Kingdom. Occidental won exploration rights in Libya in 1965 and achieved exploration and development success until all activities were suspended in 1986 as the result of economic sanctions imposed by the United States government. In 1968, Oxy entered the chemical business with the acquisition of Hooker Chemicals. This was 26 years after the contamination at Love Canal. On July 6, 1988 a fire on Piper Alpha, an oil platform in the North Sea, caused the biggest disaster in offshore oil industry's history. Today Occidental Chemical Corporation (OxyChem) is a leading chemical manufacturer with interests in basic chemicals, vinyls and performance chemical products. In 1994, Dr. Ray Irani became President and CEO of Oxy.

In 2005, Oxy was among 53 entities that contributed the maximum of $250,000 to the second inauguration of President George W. Bush.^{[1] [2] [3]}. In 2008, Oxy contributed $301,579 to Democratic candidates and $204,587 to Republican Candidates.^[4]

[edit] Operations

[edit] Oil and Gas Operations

Occidental’s oil and gas growth strategy relies on three components: Enhanced Oil Recovery (EOR), Exploration and Acquisitions.

Oil and Gas operations are focused in three core areas, the United States, the Middle East/North Africa, and South America.

In South America, Oxy operates in Argentina, and Colombia. In the Middle East, oxy has operations in Oman, Qatar, United Arab Emirates, and Yemen. Libya is its sole North African operation. In the United States--which accounts for 70 percent of its oil and gas reserves and 60 percent of current production--Oxy is the fourth largest oil and gas company.^[5] Occidental is the largest producer of natural gas in California, and the largest oil producer in Texas.^[6][7] Oxy also has operations in Kansas and Oklahoma.

Occidental formerly operated in Ecuador, but interest in Block 15 in the Ecuadorian Amazon was ended by the nation's government in 2006.^[8]

[edit] Chemical Operations

One of Oxy's wholly-owned subsidiaries includes Indspec Chemical Corporation. On October 11, 2008, Indspec's Petrolia facility experienced a spill of oleum, close to sulfuric acid, which resulted in a contamination of the ventilation system and a subsequent cloud of toxic gas in the Petrolia sky. 2,500 residents of the area were asked to evacuate.

This story was largely ignored in mainstream news sources and also occurred shortly after an interesting presidential directive which brought back what was an initial 4,000, but has now increased to 4,700 troops from Iraq to serve as active-duty members on United States soil. According to the Army Times, these troops were relocated in order to serve in the case of crowd rioting or some type of massive poisoning attack.[1]

While there were no reports of serious injury, Department of Environmental spokeswoman Freda Tarbell reportedly found hundreds of dead fish in Bear Creek following the spill.[2]

Please help improve this article or section by expanding it. Further information might be found on the talk page. (December 2008)

[edit] Controversies

[edit] Involvement at Love Canal

In 1942, Hooker Chemical and Plastics Corporation began disposing chemical waste in the Love Canal region. Other companies and the US military had used it as a chemical disposal site since the 1920s. In 1947, Hooker Chemicals became the owner and sole user of the land. In 1952 the site was filled to capacity and closed off. Later in the 1950s the local school board convinced Hooker, after threatening to use eminent domain, to sell the land to them with the intent of building a school on an unused area of the dump. Hooker Chemical sold the land to the school board for $1, with the formal caveat that the site contained waste products resulting from the manufacturing of chemicals, and disclaiming all subsequent liability. The school was built on the site and later a middle-class residential district was built upon land adjacent to the site; the associated construction broke through the 4 foot (1.2 m) clay seal containing the waste. In 1968, Hooker Chemical was purchased by Occidental Petroleum. In 1978, residents became concerned about unusual health issues in the Love Canal region, including high rates of cancer and birth defects. Soon after it became a national issue, and in 1980 then president Jimmy Carter declared a federal emergency in the area. Residents of the area were eventually relocated and Occidental paid $129 million in restitution.^[9]

[edit] Piper Alpha disaster

On July 6, 1988 Occidental's Alpha offshore production platform in the Piper oilfield in the North Sea suffered an explosion and consequent fire when a gas condensate pump was started with the pressure safety valve removed. 167 workers died in the world's worst offshore oil disaster.

[edit] Caño Limón massacre

On December 13, 1998, seventeen civilians, including 7 children, were killed when the Colombian Air Force dropped a cluster bomb on the hamlet of Santo Domingo, Colombia, after AirScan, Occidental's security contractor, incorrectly identified it as a hostile guerrilla target from a private aircraft (groups such as FARC and the National Liberation Army were active in the area). Three employees of AirScan were flying the Skymaster plane from which they provided the Colombian military with the coordinates to drop the bombs. The operation had been planned at Occidental's complex in Caño Limón by the CAF and AirScan. ^[10] A law suit was attempted in April, 2003 against Occidental Petroleum by Luis Alberto Galvis Mujica, a witness and survivor of the accident.^[11]

[edit] Recent opportunities and resistance

From 1992 to 2001, Occidental Petroleum incurred substantial resistance in its attempts to drill for oil in the territory of the U'wa people in northeast Colombia. The resistance was apparently over concern for environmental damage, tribal beliefs (the group believe that oil is the "blood of the earth" and should not be removed) and fear that development would bring strangers and violence to their region. They believe oil infrastructure will be a target for violent leftist guerillas in the country. After years of shareholder resolutions, legal battles, extensive civil disobedience and a failed test well, the company abandoned the project, which is now continued by Repsol YPF.

In 1998, the US Government sold the Elk Hills Naval Petroleum Reserve to Occidental Petroleum for USD 3.65 billion. The advertised purpose of this sale was to reduce the national debt, and reduce the size of government, as the Reserve was no longer strategically necessary. Critics of the government cited the "no-bid" nature of the sale together with Vice President Al Gore's involvement with the company as proof of graft.^[12]

In 2005, Occidental Petroleum and partner Liwa won eight out of fifteen exploration spots on the EPSA-4 auction, making both companies among the first to enter the Libyan market since the United States lifted its embargo on that country.

In August of the same year, the company was accused of 42 legal violations in Ecuador, including environmental destruction and espionage. As a result the Ecuadorian government refused to renew a contract for oil field exploration. Ecuadorian protestors in the northeast part of the country are calling for the withdrawal of Occidental.^{[citation needed]}

[edit] Outstanding lawsuits

On May 10, 2007, a group of 25 indigenous Achuar Peruvians filed suit against Occidental Petroleum, demanding cleanup and reparations for environmental damages allegedly caused by Occidental over a period of 30 years, during which time the company allegedly ignored industry standards and environmental regulations by dumping a total of 9 billion barrels of toxic oil byproducts in watersheds used by the Achuar people for fishing, drinking, and bathing. The Achuar are represented by Los Angeles-based EarthRights International (ERI) and the law firm Schonbrun DeSimone Seplow Harris & Hoffman LLP (SDSHH).^[13]

[edit] The Greenmail case

In 1984, David Murdoch owned about 5% of Occidental Petroleum's stock, and he put pressure on Occidental's management to take action to improve the value of its stock. The firm chose to pay greenmail to buy back shares from David Murdoch at $40.10 while the market price was $28.75.

[edit] Gore family ties

Occidental's coal interests were represented for many years by attorney and former U.S. Senator Albert Gore, Sr., among others. Gore, who had a long-time close friendship with Hammer, became the head of its subsidiary Island Creek Coal Company upon his election loss in the Senate. Much of Oxy's coal and phosphate production was from Tennessee, the state Gore represented in the Senate, and Gore owned shares of stock in the company. Because the stock passed to his estate after his death, his son and executor at the time, former Vice President Albert Gore, Jr. received much criticism from environmentalists.^[12][14] However, Al Gore Jr. did not exercise control over the stock, which was eventually sold when the estate closed.^[15][16]

[edit] Environmental record

Researchers at the University of Massachusetts Amherst have identified Occidental Petroleum as the 47th-largest corporate producer of air pollution in the United States, with roughly 1.2 million pounds of toxic chemicals released annually into the air.^[17] Major pollutants indicated by the study include chlorine, antimony compounds, benzotrichloride, and hydrochloric acid. ^[18] The Environmental Protection Agency has named Occidental as a potentially responsible party for at least six Superfund toxic waste sites.^[19]

[edit] Businesses

• Occidental Oil & Gas Corporation
• Occidental Chemical Corporation (Oxychem)

[edit] References

[edit] External links

• Occidental Petroleum Corporation
• Occidental Chemical Corporation