INDUSTRY SEGMENTS AND GEOGRAPHIC AREAS

12 Months Ended

Dec. 31, 2011

INDUSTRY SEGMENTS AND GEOGRAPHIC AREAS

INDUSTRY SEGMENTS AND GEOGRAPHIC AREAS

NOTE 16     INDUSTRY SEGMENTS AND GEOGRAPHIC AREAS

Occidental conducts its continuing operations through three segments: (1) oil and gas; (2) chemical; and (3) midstream, marketing and other (midstream and marketing).  The oil and gas segment explores for, develops and produces oil and condensate, NGLs, and natural gas.  The chemical segment mainly manufactures and markets basic chemicals and vinyls.  The midstream and marketing segment gathers, treats, processes, transports, stores, purchases and markets oil, condensate, NGLs, natural gas, CO2 and power.  It also trades around its assets, including pipelines and storage capacity, and trades oil, NGLs, gas and other commodities.

Earnings of industry segments and geographic areas exclude income taxes, interest income, interest expense, environmental remediation expenses, unallocated corporate expenses and discontinued operations, but include gains and losses from dispositions of segment and geographic area assets and income from the segments’ equity investments.  Intersegment sales eliminate upon consolidation and are generally made at prices approximately equal to those that the selling entity would be able to obtain in third-party transactions.

Identifiable assets are those assets used in the operations of the segments.  Corporate assets consist of cash, certain corporate receivables and PP&E, and an investment in the Joslyn, Canada oil sands project.

INDUSTRY SEGMENTS

In millions

	Oil and Gas			Chemical			Midstream, Marketing and Other			Corporate and Eliminations			Total
YEAR ENDED DECEMBER 31, 2011
Net sales	$	18,419	(a)	$	4,815	(b)	$	1,447	(c)	$	(742	)	$	23,939
Pretax operating profit(loss)	$	10,241	(d)	$	861		$	448		$	(709	) (f)	$	10,841	(d)
Income taxes	—			—			—			(4,201		) (g)	(4,201		)
Discontinued operations, net	—			—			—			131			131
Net income(loss) attributable to common stock	$	10,241	(d)	$	861		$	448		$	(4,779	) (h)	$	6,771
Investments in unconsolidated entities	$	128		$	121		$	1,812		$	11		$	2,072
Property, plant and equipment additions, net (i)	$	6,192		$	241		$	1,120		$	51		$	7,604
Depreciation, depletion and amortization	$	3,064		$	330		$	173		$	24		$	3,591
Total assets	$	38,967		$	3,754		$	11,962		$	5,361		$	60,044
YEAR ENDED DECEMBER 31, 2010
Net sales	$	14,276	(a)	$	4,016	(b)	$	1,471	(c)	$	(718	)	$	19,045
Pretax operating profit(loss)	$	7,151	(d),(e)	$	438		$	472		$	(497	) (f)	$	7,564	(d),(e)
Income taxes	—			—			—			(2,995		) (g)	(2,995		)
Discontinued operations, net	—			—			—			(39		)	(39		)
Net income(loss) attributable to common stock	$	7,151	(d),(e)	$	438		$	472		$	(3,531	) (h)	$	4,530	(e)
Investments in unconsolidated entities	$	123		$	135		$	1,770		$	11		$	2,039
Property, plant and equipment additions, net (i)	$	3,211		$	248		$	537		$	38		$	4,034
Depreciation, depletion and amortization	$	2,668		$	321		$	142		$	22		$	3,153
Total assets	$	31,855		$	3,755		$	10,445		$	6,377	(j)	$	52,432
YEAR ENDED DECEMBER 31, 2009
Net sales	$	11,009	(a)	$	3,225	(b)	$	1,016	(c)	$	(436	)	$	14,814
Pretax operating profit(loss)	$	5,097	(d),(e)	$	389		$	235		$	(507	) (f)	$	5,214	(d),(e)
Income taxes	—			—			—			(2,063		) (g)	(2,063		)
Discontinued operations, net	—			—			—			(236		)	(236		)
Net income(loss) attributable to common stock	$	5,097	(d),(e)	$	389		$	235		$	(2,806	) (h)	$	2,915	(e)
Investments in unconsolidated entities	$	118		$	131		$	1,473		$	10		$	1,732
Property, plant and equipment additions, net (i)	$	2,571		$	213		$	583		$	39		$	3,406
Depreciation, depletion and amortization	$	2,258		$	298		$	110		$	21		$	2,687
Total assets	$	26,854		$	3,608		$	8,773		$	4,994	(j)	$	44,229

(See footnotes on next page)

Footnotes:

(a)Oil sales represented approximately 87 percent, 86 percent and 86 percent of the oil and gas segment net sales for the years ended December 31, 2011, 2010 and 2009, respectively.

(b)Total product sales for the chemical segment comprised the following:

	Basic Chemicals		Vinyls		Other Chemicals
Year ended December 31, 2011	58	%	39	%	3	%
Year ended December 31, 2010	57	%	40	%	3	%
Year ended December 31, 2009	63	%	34	%	3	%

(c)Total sales for the midstream and marketing segment comprised the following:

					Marketing, Trading,
	Gas Processing		Power		Transportation and other
Year ended December 31, 2011	64	%	27	%	9	%
Year ended December 31, 2010	52	%	27	%	21	%
Year ended December 31, 2009	56	%	26	%	18	%

(d)The 2011 amount includes pre-tax charges of $35 million related to exploration write-offs in Libya and $29 million related to a Colombian net worth tax, and a pre-tax gain for sale of an interest in a Colombian pipeline of $22 million.  The 2010 amount includes a $275 million pre-tax charge for asset impairments, predominantly of gas properties in the Rocky Mountain region.  The 2009 amount includes an $8 million pre-tax charge for the termination of rig contracts. 

(e)Includes amounts attributable to common stock after deducting noncontrolling interest amounts of $72 million and $51 million for 2010 and 2009, respectively.

(f)Includes unallocated net interest expense, administration expense, environmental remediation and other pre-tax items noted in footnote (h) below.

(g)Includes all foreign and domestic income taxes from continuing operations.

(h)Includes the following significant items affecting earnings for the years ended December 31:

Benefit (Charge) (In millions)	2011			2010			2009
CORPORATE
Pre-tax operating profit (loss)
Premium on debt extinguishments	$	(163	)	$	—		$	—
Severance charge	—			—			(40		)
Railcar leases	—			—			(15		)
	$	(163	)	$	—		$	(55	)
Income taxes
State income tax charge	$	(33	)	$	—		$	—
Foreign tax credit carryforwards	—			80			—
Tax effect of pre-tax adjustments *	50			100			22
	$	17		$	180		$	22
Discontinued operations, net of tax **	$	131		$	(39	)	$	(236	)

*Amounts represent the tax effect of all pre-tax adjustments listed, as well as those in footnote (d).

**The 2011 amount includes a $144 million after-tax gain from the sale of the Argentine operations.  The 2009 amount includes an after-tax charge of $111 million for asset impairments of certain Argentine producing properties.

(i)Includes capital expenditures, capitalized interest, and for 2009, capitalized CO2, and excludes purchases of assets, net.  Also includes amounts attributable to the noncontrolling interest in a Colombian subsidiary for 2010 and 2009.

(j)Includes Argentine assets held for sale for 2010 and 2009.

GEOGRAPHIC AREAS

In millions

	Net sales (a)						Property, plant and equipment, net
For the years ended December 31,	2011		2010		2009		2011		2010		2009
United States	$	15,040	$	12,151	$	9,448	$	36,283	$	28,571	$	23,440
Foreign
Qatar	3,432		2,677		2,201		2,735		2,823		2,842
Oman	2,500		1,666		1,038		2,143		1,967		1,885
Colombia	1,054		999		922		854		715		688
Yemen	907		766		667		245		347		398
United Arab Emirates	187		100		8		1,448		223		151
Libya	151		373		243		926		953		968
Other Foreign	668		313		287		1,050		937		765
Total Foreign	8,899		6,894		5,366		9,401		7,965		7,697
Total	$	23,939	$	19,045	$	14,814	$	45,684	$	36,536	$	31,137

(a)Sales are shown by individual country based on the location of the entity making the sale.