Scribd Logo
Upload

Welcome to Scribd!

  • 45 views

    Occidental Sells North Sea Fields For $1.35 Billion - LA Times, May 09, 1991

    Uploaded by

    The Toxic Trinity
    In its second major sale in a week, Occidental Petroleum Corp. said Wednesday it will sell its North Sea oil and gas holdings to France's Societe Nationale Elf Aquitaine for $1.35 billion in cash. The sale, applauded by analysts and Wall Street investors, will put the company ahead of schedule in meeting its goal of cutting $3 billion of long-term debt under an ambitious restructuring instituted after the death of company patriarch Armand Hammer last December (1990). "We consider it an excellent sale," Occidental Chairman Ray R. Irani said Wednesday. The proposed sale is the largest by far under Occidental's restructuring. Other sales have come with surprising swiftness since January. Wall Street responded favorably to word of the sale, which had been rumored for about a month. Occidental's stock closed up $1.25 at $20.25 a share in trading Wednesday, topping the list of most heavily traded issues on the New York Stock Exchange. Irani said the company planned to boost oil and gas exploration spending by 10% over 1990's $200 million. As a sign of the company's continuing search for new oil, Irani revealed Wednesday the company was in "advanced negotiations" with Albania and Angola on rights to "high potential blocks" in those countries. Occidental is already exploring for or developing oil resources in Latin America, Indonesia, Malaysia, Oman, Pakistan, the Philippines, Syria and Yemen. Analysts generally praised the North Sea deal, saying that Occidental managed to win a price higher than that traditionally paid for oil reserves in that area. Occidental won between $6 and $9 a barrel, compared to an average $4 a barrel for North Sea reserves in the last three years, analysts said. --------------------------------------- Copyright 2016 Los Angeles Times

    Copyright:

    © All Rights Reserved
    Flag for inappropriate content

    You might also like

    Occidental Sells North Sea Fields For $1.35 Billion - LA Times, May 09, 1991

    Uploaded by

    The Toxic Trinity
    45 views3 pages
    In its second major sale in a week, Occidental Petroleum Corp. said Wednesday it will sell its North Sea oil and gas holdings to France's Societe Nationale Elf Aquitaine for $1.35 billion in cash. The sale, applauded by analysts and Wall Street investors, will put the company ahead of schedule in meeting its goal of cutting $3 billion of long-term debt under an ambitious restructuring instituted after the death of company patriarch Armand Hammer last December (1990). "We consider it an excellent sale," Occidental Chairman Ray R. Irani said Wednesday. The proposed sale is the largest by far under Occidental's restructuring. Other sales have come with surprising swiftness since January. Wall Street responded favorably to word of the sale, which had been rumored for about a month. Occidental's stock closed up $1.25 at $20.25 a share in trading Wednesday, topping the list of most heavily traded issues on the New York Stock Exchange. Irani said the company planned to boost oil and gas exploration spending by 10% over 1990's $200 million. As a sign of the company's continuing search for new oil, Irani revealed Wednesday the company was in "advanced negotiations" with Albania and Angola on rights to "high potential blocks" in those countries. Occidental is already exploring for or developing oil resources in Latin America, Indonesia, Malaysia, Oman, Pakistan, the Philippines, Syria and Yemen. Analysts generally praised the North Sea deal, saying that Occidental managed to win a price higher than that traditionally paid for oil reserves in that area. Occidental won between $6 and $9 a barrel, compared to an average $4 a barrel for North Sea reserves in the last three years, analysts said. --------------------------------------- Copyright 2016 Los Angeles Times

    Original Title

    Occidental Sells North Sea Fields for $1.35 Billion - LA Times, May 09, 1991

    Copyright

    © © All Rights Reserved

    Did you find this document useful?

    Is this content inappropriate?

    Report this Document
    In its second major sale in a week, Occidental Petroleum Corp. said Wednesday it will sell its North Sea oil and gas holdings to France's Societe Nationale Elf Aquitaine for $1.35 billion in cash. The sale, applauded by analysts and Wall Street investors, will put the company ahead of schedule in meeting its goal of cutting $3 billion of long-term debt under an ambitious restructuring instituted after the death of company patriarch Armand Hammer last December (1990). "We consider it an excellent sale," Occidental Chairman Ray R. Irani said Wednesday. The proposed sale is the largest by far under Occidental's restructuring. Other sales have come with surprising swiftness since January. Wall Street responded favorably to word of the sale, which had been rumored for about a month. Occidental's stock closed up $1.25 at $20.25 a share in trading Wednesday, topping the list of most heavily traded issues on the New York Stock Exchange. Irani said the company planned to boost oil and gas exploration spending by 10% over 1990's $200 million. As a sign of the company's continuing search for new oil, Irani revealed Wednesday the company was in "advanced negotiations" with Albania and Angola on rights to "high potential blocks" in those countries. Occidental is already exploring for or developing oil resources in Latin America, Indonesia, Malaysia, Oman, Pakistan, the Philippines, Syria and Yemen. Analysts generally praised the North Sea deal, saying that Occidental managed to win a price higher than that traditionally paid for oil reserves in that area. Occidental won between $6 and $9 a barrel, compared to an average $4 a barrel for North Sea reserves in the last three years, analysts said. --------------------------------------- Copyright 2016 Los Angeles Times

    Copyright:

    © All Rights Reserved
    Flag for inappropriate content
    45 views3 pages

    Occidental Sells North Sea Fields For $1.35 Billion - LA Times, May 09, 1991

    Uploaded by

    The Toxic Trinity
    In its second major sale in a week, Occidental Petroleum Corp. said Wednesday it will sell its North Sea oil and gas holdings to France's Societe Nationale Elf Aquitaine for $1.35 billion in cash. The sale, applauded by analysts and Wall Street investors, will put the company ahead of schedule in meeting its goal of cutting $3 billion of long-term debt under an ambitious restructuring instituted after the death of company patriarch Armand Hammer last December (1990). "We consider it an excellent sale," Occidental Chairman Ray R. Irani said Wednesday. The proposed sale is the largest by far under Occidental's restructuring. Other sales have come with surprising swiftness since January. Wall Street responded favorably to word of the sale, which had been rumored for about a month. Occidental's stock closed up $1.25 at $20.25 a share in trading Wednesday, topping the list of most heavily traded issues on the New York Stock Exchange. Irani said the company planned to boost oil and gas exploration spending by 10% over 1990's $200 million. As a sign of the company's continuing search for new oil, Irani revealed Wednesday the company was in "advanced negotiations" with Albania and Angola on rights to "high potential blocks" in those countries. Occidental is already exploring for or developing oil resources in Latin America, Indonesia, Malaysia, Oman, Pakistan, the Philippines, Syria and Yemen. Analysts generally praised the North Sea deal, saying that Occidental managed to win a price higher than that traditionally paid for oil reserves in that area. Occidental won between $6 and $9 a barrel, compared to an average $4 a barrel for North Sea reserves in the last three years, analysts said. --------------------------------------- Copyright 2016 Los Angeles Times

    Copyright:

    © All Rights Reserved
    Flag for inappropriate content
    of 3

    articles.latimes.

    com

    http://articles.latimes.com/19910509/business/fi2142_1_northseaoil

    OccidentalSellsNorthSeaFieldsfor$1.35Billion:Energy:
    Theactionwillputtheoilcompanyaheadofscheduleonits
    goalofcutting$3billioninlongtermdebt.
    Initssecondmajorsaleinaweek,OccidentalPetroleumCorp.saidWednesdaythatitwillsellitsNorth
    SeaoilandgasholdingstoFrance'sSocieteNationaleElfAquitainefor$1.35billionincash.
    Thesale,applaudedbyanalystsandWallStreetinvestors,willputthecompanyaheadofschedulein
    meetingitsgoalofcutting$3billionoflongtermdebtunderanambitiousrestructuringinstitutedafterthe
    deathofcompanypatriarchArmandHammerlastDecember.
    "Weconsideritanexcellentsale,"OccidentalChairmanRayR.IranisaidWednesday.
    TheproposedsaleisthelargestbyfarunderOccidental'srestructuring.Othersaleshavecomewith
    surprisingswiftnesssinceJanuary,whenIranisetthegoalofcuttingdebtby$1.5billionineachofthenext
    twoyears.
    ThesalecomesontheheelsofanannouncementMondaythatOccidentalwillsellahalfinterestinits
    naturalgasliquidsbusinesstoDallasinvestmentfirmHicks,Muse&Co.ina$700milliondeal.

    Alltold,Occidentalhassoldatotalof$2.2billionworthofassetsforanaftertaxbenefitof$1.8billion,Irani
    expectstotellshareholdersatthecompany'sannualmeetingtoday.Furthersales,especiallyof
    meatpackingsubsidiaryIBPInc.,areexpected.
    WallStreetrespondedfavorablytowordofthesale,whichhadbeenrumoredforaboutamonth.
    Occidental'sstockclosedup$1.25at$20.25ashareintradingWednesday,toppingthelistofmostheavily
    tradedissuesontheNewYorkStockExchange.
    Still,thesalecallsintoquestionhowfarOccidentaliswillingtogotoreachitsdebtreductiongoal.
    Occidental'sinterestsinNorthSeaoilfieldswereamongthecompany'scrownjewels,andthesaleofthem
    wouldreduceOccidental'soilandgasreservesbyabout19%.
    ButIranideniedthatthesalesindicatedawithdrawalfromtheenergybusiness."Oilandgasaredefinitelya
    veryimportantpartofOxy,"hesaidinatelephonepressconference."It'sourmostimportantbusiness,and
    thecapitalspendingthatwe'redoingcontinuestoemphasizeoilandgas."
    Iranisaidthecompanyplannedtoboostoilandgasexplorationspendingby10%over1990's$200million.
    Asasignofthecompany'scontinuingsearchfornewoil,IranirevealedWednesdaythatthecompanywas
    in"advancednegotiations"withAlbaniaandAngolaonrightsto"highpotentialblocks"inthosecountries.
    OccidentalisalreadyexploringforordevelopingoilresourcesinLatinAmerica,Indonesia,Malaysia,Oman,
    Pakistan,thePhilippines,SyriaandYemen.
    AnalystsgenerallypraisedtheNorthSeadeal,sayingthatOccidentalmanagedtowinapricehigherthan
    thattraditionallypaidforoilreservesinthatarea.Occidentalwonbetween$6and$9abarrel,comparedto
    anaverage$4abarrelforNorthSeareservesinthelastthreeyears,analystssaid.
    "They'reextractingsomeverysignificantvaluefromthissale,"saidEugeneNowak,anindustryanalystwith

    DeanWitterReynoldsinNewYork.
    Undertermsofthedeal,whichissubjecttogovernmentapprovals,theLosAngelesbasedcompany's
    BritishsubsidiarywillbesoldtoElfAquitainefor$1.35billionincash.Elfwillalsoassumeabout$150
    millionindebtandrepayintercompanyloanbalancesowedbythesubsidiarytoOccidental,anamountIrani
    called"minimal."Thesaleisexpectedtobecompletedin60days.
    Inaseparateannouncement,ElfannouncedthatitwillformajointcompanywithEnterpriseOilPLCof
    Britain,tobecalledElfEnterprisePetroleumLtd.,whichwillowntheOccidentalproperties.Elfwillowntwo
    thirdsoftheventureandEnterpriseonethird.
    Occidental'sBritishunit,OccidentalPetroleum(GreatBritain)Inc.,includesinterestsinthePiper,Saltire,
    Scapa,ChanterandClaymoreoilfieldsintheNorthSea.

    OccidentalestimatesthatitsprovedoilandgasreservesintheNorthSeaamountedto142millionbarrels
    in1990.Elfestimatesthattheprovedandprobablereservesarecloserto217millionbarrels.
    Occidental'sshareofdailyoilandgasproductionfromtheholdingsaveraged25,000barrelsperday,Elf
    reported.TheScapaandClaymorefieldsaretheonlyonesinproductiontheotherfieldsareunder
    development.
    ThePiperoilfieldwasthesiteofadevastating1988explosiononOccidental'sPiperAlphaplatformthat
    killed167workersintheworld'sworstplatformaccident.
    Thepropertiesalsoinclude36.5%oftheFlottaoilpipelineandterminalintheOrkneyIslands.
    OccidentalhaslongbeenamajorplayerintheNorthSea.TheNorthSeaholdingsandthenaturalgas
    liquidsbusinesstogetheraccountforabout13.5%ofOccidental'stotaloilandgasproduction,Iranisaid.
    "Theydidselloffasubstantialportionoftheirfutureoilproductionvolumesand,therefore,theyhave
    becomemuchmoreofanexplorationorientedcompany,"saidMichaelYoung,anoilanalystatSmith
    Barney,HarrisUpham&Co.inNewYork.

    articles.latimes.com

    http://articles.latimes.com/19910509/business/fi2142_1_northseaoil/2

    OccidentalSellsNorthSeaFieldsfor$1.35Billion:Energy:
    Theactionwillputtheoilcompanyaheadofscheduleonits
    goalofcutting$3billioninlongtermdebt.
    Butheadded:"TheimportantpointhereisthatOccidentalwouldhavehadtomakesignificantcapital
    expenditurestodeveloptheseassetsoverthenextseveralyears,andIdon'tknowifthecompanywas
    reallyinterestedinspendingalargeamountofmoneyinthissinglearea,givenitspresentconstraints."
    OxySlimsDown
    Inlessthanfourmonths,OccidentalPetroleumsaysithassold$2.2billioninassets,foranaftertaxgainof
    $1.8billion,whichisavailabletoreduceitslongtermdebt:
    Dec.10,1990:ArmandHammerdies.
    Jan.14,1991:Occidental,undernewChairmanRayR.Irani,announcesa$2billionrestructuringthatwill
    includelayoffs,writedownsandthesaleofmajorassets.
    Jan.28:Occidentalsells5.4%interestinChurch&Dwight,makersofArm&Hammerbakingsoda,for$19
    million.
    Feb.7:OccidentalsellshalfinterestinAntwerpNGLterminalinBelgiumfor$38million
    April29:SaleofindustrialphosphateandphosphoricacidbusinesstoFMCCorp.pricenotdisclosedbut
    estimatedat$100million.
    May6:OccidentalsellshalfinterestinnaturalgasliquidsbusinesstoHicks,Muse&Co.for$700million.
    May8:OccidentalsellsNorthSeaoilfieldsandotherholdingstoFrenchBritishpartnershipfor$1.35billion.

    You might also like