SPIN-OFF OF CALIFORNIA RESOURCES CORPORATION

12 Months Ended

Dec. 31, 2015

Spin-off of California Resources Corporation


NOTE 17	SPIN-OFF OF CALIFORNIA RESOURCES CORPORATION

On November 30, 2014, Occidental’s California oil and gas operations and related assets was spun-off through the pro rata distribution of 81.3 percent of the outstanding shares of common stock of California Resources, creating an independent, publicly traded company. Occidental shareholders at the close of business on the record date of November 17, 2014 received 0.4 shares of California Resources for every share of Occidental common stock held.

In connection with the spin-off, California Resources distributed to Occidental $4.95 billion in restricted cash and $1.15 billion in unrestricted cash. Occidental retained 71.5 million shares in California Resources, see Note 14. In February 2016, Occidental declared a special stock dividend for all of its 71.5 million shares of common stock of California Resources to stockholders of record as of February 29, 2016, to be distributed on March 24, 2016. As indicated by a private letter ruling from the IRS, the $4.95 billion distribution will be used solely to pay dividends, repurchase common stock, repay debt, or a combination of the foregoing, within eighteen months following the distribution. At December 31, 2015, the remaining balance of the restricted cash distribution was $1.2 billion. Subsequent to December 31, 2015, Occidental utilized the remaining restricted cash balance to retire debt and pay dividends.

Sales and other operating revenues and income from discontinued operations related to California Resources were as follows:

For the years ended December 31, (in millions)	2014		2013

Sales and other operating revenue from discontinued operations	$	3,951	$	4,285
Income from discontinued operations before-tax	1,205		1,531
Income tax expense	440		541

Income from discontinued operations	$	765	$	990