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INDUSTRY SEGMENTS AND GEOGRAPHIC AREAS
 12 Months Ended
Dec. 31, 2017
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 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, processes, transports, stores, purchases and markets oil, condensate, NGLs, natural gas, CO2 and power. It also trades around its assets, including transportation and storage capacity. Additionally, the midstream and marketing segment operates a crude oil export terminal, as well as invests in entities that conduct similar activities.

Results 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 approximating 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 and restricted cash, certain corporate receivables and PP&E.

 

Industry Segments

 

 

 

 

 

 

 

 

 

 

 

(in millions)

 

Oil and Gas

 

Chemical

 

Midstream
and
Marketing

 

Corporate
and Eliminations

 

Total

 

Year ended December 31, 2017

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$
7,870

(a)

$
4,355

(b)

$
1,157

(c)

$
(874)

 

$
12,508

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pretax operating profit (loss)

 

$
1,111

(d)

$
822

 

$
85

(e)

$
(690)

(f)

$
1,328

 

Income taxes

 

—

 

—

 

—

 
(17)

(g)
(17)

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) attributable to common stock

 

$
1,111

 

$
822

 

$
85

 

$
(707)

 

$
1,311

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments in unconsolidated entities

 

$

—

 

$
771

 

$
739

 

$
5

 

$
1,515

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Property, plant and equipment additions, net (h)

 

$
2,968

 

$
323

 

$
296

 

$
64

 

$
3,651

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation, depletion and amortization

 

$
3,269

 

$
352

 

$
340

 

$
41

 

$
4,002

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets

 

$
23,595

 

$
4,364

 

$
11,775

 

$
2,292

 

$
42,026

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year ended December 31, 2016

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$
6,377

(a)

$
3,756

(b)

$
684

(c)

$
(727)

 

$
10,090

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pretax operating profit (loss)

 

$
(636)

(d)

$
571

(i)

$
(381)

(e)

$
(1,218)

(f)

$
(1,664)

 

Income taxes

 

—

 

—

 

—

 
662

(g)
662

 

Discontinued operations, net

 

—

 

—

 

—

 
428

(j)
428

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) attributable to common stock

 

$
(636)

 

$
571

 

$
(381)

 

$
(128)

 

$
(574)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments in unconsolidated entities

 

$

—

 

$
730

 

$
666

 

$
5

 

$
1,401

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Property, plant and equipment additions, net (h)

 

$
1,998

 

$
353

 

$
370

 

$
59

 

$
2,780

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation, depletion and amortization

 

$
3,575

 

$
340

 

$
313

 

$
40

 

$
4,268

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets

 

$
24,130

 

$
4,348

 

$
11,059

 

$
3,572

 

$
43,109

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year ended December 31, 2015

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$
8,304

(a)

$
3,945

(b)

$
891

(c)

$
(660)

 

$
12,480

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pretax operating profit (loss)

 

$
(8,060)

(d)

$
542

(i)

$
(1,194)

(e)

$
(764)

(f)

$
(9,476)

 

Income taxes

 

—

 

—

 

—

 
1,330

(g)
1,330

 

Discontinued operations, net

 

$

—

 

—

 

—

 
317

(j)
317

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) attributable to common stock

 

$
(8,060)

 

$
542

 

$
(1,194)

 

$
883

 

$
(7,829)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments in unconsolidated entities

 

$
4

 

$
550

 

$
708

 

$
5

 

$
1,267

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Property, plant and equipment additions, net (h)

 

$
4,485

 

$
271

 

$
611

 

$
42

 

$
5,409

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation, depletion and amortization

 

$
3,886

 

$
371

 

$
249

 

$
38

 

$
4,544

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets

 

$
23,591

 

$
3,982

 

$
10,175

 

$
5,661

 

$
43,409

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(See footnotes on next page)

 

 

 

 

 

 

 

 

 

 

 

 

Footnotes:

(a)

Oil sales represented approximately 90 percent of the oil and gas segment net sales for the years ended December 31, 2017, 2016 and 2015.

(b)

Net sales for the chemical segment comprised the following products:

 

 

 

Basic Chemicals

 

Vinyls

 

Other Chemicals

 

Year ended December 31, 2017

 

57%

 

42%

 

1%

 

Year ended December 31, 2016

 

57%

 

40%

 

3%

 

Year ended December 31, 2015

 

56%

 

40%

 

4%

 

 

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

 

 

 

Gas Processing

 

Power

 

Marketing,
Transportation and other *

 

Year ended December 31, 2017

 

69%

 

28%

 

3%

 

Year ended December 31, 2016

 

92%

 

44%

 

(36)%

 

Year ended December 31, 2015

 

70%

 

31%

 

(1)%

 

 

*  Revenue from all marketing activities is reported on a net basis.

 

(d)

The 2017 amount includes pre-tax asset sale gains of $655 million primarily related to South Texas and non-core acreage in the Permian basin and $397 million for the impairment of non-core proved and unproved Permian acreage. The 2016 amount includes pre-tax asset sale gains of $121 million and $59 million related to Piceance and South Texas oil and gas properties, pre-tax charges of $61 million related to the sale of Libya and the exit from Iraq, and pre-tax gain of $24 million for other related items. The 2015 amount includes pre-tax charges of $5 billion for impairment of international oil and gas assets and related items and $3.5 billion for the impairment of domestic oil and gas assets and related items.

(e)

The 2017 amount includes pre-tax charges of $120 million related to asset impairments of idled facilities. The 2016 amount includes pre-tax charges of $160 million related to the termination of crude oil supply contracts. The 2015 amount includes pre-tax charges of $1.3 billion related to asset impairments and related items.

(f)

Includes unallocated net interest expense, administration expense, environmental remediation and other pre-tax items noted below.

 

Benefit (Charge) (in millions)

 

2017

 

2016

 

2015

 

CORPORATE

 

 

 

 

 

 

 

Pre-tax operating profit (loss)

 

 

 

 

 

 

 

Asset sale losses

 

$

—

 

$

—

 

$
(8)

 

Asset impairments and related items

 

—

 
(619)

 
(235)

 

Severance, spin-off and other

 

—

 

—

 
(118)

 

 

 

 

 

 

 

 

 

 

 

$

—

 

$
(619)

 

$
(361)

 

 

 

 

 

 

 

 

 

 

 

 

Income taxes

 

 

 

 

 

 

 

Tax effect of pre-tax and other adjustments *

 

$
392

 

$
424

 

$
1,903

 

 

* Amounts represent the tax effect of the pre-tax adjustments listed in this note, as well as those in footnotes (d), (e) and (f).

 

(g)

Includes all foreign and domestic income taxes from continuing operations.

(h)

Includes capital expenditures and capitalized interest, but excludes acquisition and disposition of assets.

(i)

The 2016 amount includes gain on sale of $57 million and $31 million related to Occidental Tower in Dallas, Texas, and a non-core specialty chemicals business, respectively. The 2015 amount includes the pre-tax charge of $121 million related to asset impairment partially offset by a $98 million gain on sale of an idled facility.

(j)

Includes discontinued operations from Ecuador.

 

GEOGRAPHIC AREAS

 

(in millions)

 

Net sales (a)

 

Property, plant and equipment, net

 

For the years ended December 31,

 

2017

 

2016

 

2015

 

2017

 

2016

 

2015

 

United States

 

$
8,085

 

$
6,290

 

$
7,479

 

$
22,863

 

$
24,004

 

$
23,265

 

Foreign

 

 

 

 

 

 

 

 

 

 

 

 

 

Oman

 
1,397

 
1,101

 
1,631

 
1,962

 
1,858

 
1,292

 

Qatar

 
1,394

 
1,206

 
1,449

 
1,236

 
1,299

 
1,354

 

Colombia

 
555

 
463

 
570

 
807

 
741

 
821

 

United Arab Emirates

 
808

 
664

 
477

 
4,241

 
4,373

 
4,484

 

Other Foreign

 
269

 
366

 
874

 
65

 
62

 
423

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Foreign

 
4,423

 
3,800

 
5,001

 
8,311

 
8,333

 
8,374

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

$
12,508

 

$
10,090

 

$
12,480

 

$
31,174

 

$
32,337

 

$
31,639

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(a)

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