Good morning. My name is Ketura and I will be your conference operator today. At this time, I would like to welcome everyone to the Occidental Petroleum Corporation first quarter 2009 earnings conference call. All lines have been placed on mute to prevent any background noise. After the speaker’s remarks, there will be a question-and-answer session. (Operator Instructions). I would now like to turn the call over to Chris Stavros. Please go ahead, sir.

Thank you, Ketura, and good morning everyone. I’d like to welcome you to Occidental’s first quarter 2009 earnings conference call. Joining us on the call from Los Angeles this morning are Dr. Ray Irani, Oxy’s Chairman and CEO and Steve Chazen, our President and CFO; Will Albrecht, Oxy’s President of U.S. Oil and Gas, and Sandy Lowe, our new President of Oxy’s Oil and Gas International Operations will also be joining us and available during the Q-&-A session. In just a moment, I’ll be passing the call over to Steve, who will provide further details on our quarterly results and operations. Our first quarter earnings press release, Investor Relations supplemental schedules and earnings conference call slides which refer to Steve’s remarks can be downloaded from our website at www.oxy.com. I’ll now turn the call over to Steve. Steve, please go ahead.

Net income for the quarter was $368 million or $0.45 per diluted share compared to $1.8 billion or $2.22 per diluted share in the first quarter of 2008. 2009 first quarter net income includes after-tax non-core charge of $39 million, including $21 million for severance, $10 million for railcar leases, $5 million for rig termination cost and $3 million for discontinued operations. The quarter results were $407 million or $0.50 per diluted share in the first quarter of 2009, compared to $1.8 billion or $2.19 per diluted share in the first quarter of last year. Here is the segment breakdown for the first quarter. Oil and gas first quarter 2009 segment earnings were $545 million. After excluding the rig termination cost, the first quarter 2009 core results were $553 million compared to $2.9 billion for last year. $2.3 billion decrease in the first quarter earnings was due to lower crude oil and natural gas prices and higher DD&A rates. Occidental’s average realized crude price in 2009 first quarter was $39.29, a decrease of 55% from $86.75 in the comparable period of 2008. Oxy’s domestic average realized gas price for the quarter was $3.54 per MCF, compared to $8.15 per MCF for the first quarter of 2008, a decline of about 57%. Worldwide oil and gas sales volume for the first quarter of 2009 were 654,000 barrels of oil equivalent per day, an increase of nearly 8% compared to 607,000 BOEs per day in the first quarter of last year. The increase includes 22,000 BOE a day from domestic operations, 15,000 BOE a day from Oman and 10,000 BOE a day from Argentina. About half of the domestic volume increase was attributable to our acquisition from last year. Over the course of little over year Occidental has drilled 35 wells seeking…

(Operator Instructions) Your first question comes from Michael Jacobs - Tudor Pickering.

Steve I appreciate the color on California activity. Can you give us a little history on how overall activity in California is evolved over the last year or two and some of the assumptions that go into how you arrived at sub $10 a barrel estimate for [S&D] and lifting cost?

We started this project, I think 5 years ago, well the notion there were right reservoirs that hadn’t [inaudible] elsewhere in the state, and so we begun accumulating acreage. We really don’t want to get into any more detail about how the numbers were computed, it’s very early in the process and we are really not something we told you what we think. We can tell you with high certainty and we want to stay away from speculating about what it might turn out.

Okay. Just one more questions on the Permian with CO2 representing about 50,000 barrels a day future growth. How are you accessing the overall risk to that future growth and what is the potential recourse in kind of a worst case situation?

Talking about some SandRidge?

Yes.

No, things are going just fine with SandRidge we don’t have any reason to believe that anything is going to happen except the plant is going to deliver generally on time. So, there is plenty of drilling locations in the area with lots of CO2. So I really not worried that we won’t be able to supply CO2. If SandRidge doesn’t supply for some reason, which I don’t see why, the area is loaded with wells with relative small amounts of methane and lots of CO2. It’s not something we spend a lot time worrying about and I think they are doing fine, they seem to be okay.

Your next question comes from Michael LaMotte - J.P. Morgan.

If I could sort off follow up on the CapEx question and your cost question. I just want to get some sense from you is to how you think about the returns, or the difference between your realizations and your target cost in terms of when you actually might see some of your shorter cycle activity turn back-up against of the trends and volumes that looks to be down sequentially this year might actually stop and reverse?

Our volume scores are up sequentially, but --

Well, I mean from the Q1 level right. I mean your, say 54 guidance 640 to 660 for next quarter?

To some extent the each quarter is a little difficult to worry about. We try to estimate how much trouble we are going to have in a quarter and we ran a little better than other we planned. That is always something in the oil business that makes these productions a little slower. So that’s what we give you a range. I wouldn’t read a whole lot into the varying selection.

Okay, Well as I think about the full year, you guided to 4%, you’re starting off at 8%. I just understand that there is some trailing off as we move through the years out?

I’m trying to gauge how much that is?

In the first quarter we said 10,000 barrels a day loss from lower capital. There is no reason to believe if that isn’t going to happen. We’re still sizably above searching gas. In the Piceance, we did have a lot more production in gas, but it just doesn’t make any sense at these levels. So we’re a long way away in getting cost in line with $2.5 gas in the Piceance.

If I think about the CapEx from Q1 to Q4 and the variance of activity versus what you are actually saving in costs, do you have a run rate now in terms of workover rigs, etc that you are comfortable with or do we actually start ramping up again in Q4 and Q1 next year?

We will see what prices are and the cost are.

Okay. A lot of the companies are talking about targeting cost in ‘04 level, does that sort of make sense to you in terms of when you --?

Yes, it does certainly for oils. The gas is sort of fallen off from cliff here in case you haven’t noticed. We not at 2004 levels of gas, the cost of gas drilling has to fall sharply and we’ve seen some of that obviously but not near enough.

If I could shift towards geographically over to the Middle East, can you maybe give us an update as to where we are on Dolphin and any potential talk of expansion, I know UAE is still short gas coming into this summer. I curious if there is talk on --?

The UAE is still short of gas. The increase in potential volume for Dolphin was has to come from Qatar and right now they are really not looking at any new projects basically in that regard. They are still accessing how much the North fields have. So Dolphin would take advantage when Qatar cancels other gas to move some of the gas in to that pipeline, because the pipeline as you know can handle more than is produced by the concession area we have. So, that’s said on that issue.

Theoretically, what is the throughput on Dolphin I mean, under 2.2 is part of the targeted capacity level, but at this summer could there be days or in our periods where you are that three?

Well, Sandy Lowe is on the phone and he built the facility so for the first time we have him answer the tested questions. Sandy, would you answer that regards the capacity and flexibility if we had to get to them.

Yes, thank you, Dr. Irani. We have the ability to float $3.2 billion a day through the pipeline. We do not have the contractual rights to that as Dr. Irani as said, nor do we have all of the compressors at currently in place to handle that. I’m sure there will be the technical possibilities for the future.

In terms of adding the compression, is that some thing that could be done relatively quickly or is this something that we could may expect to be built up over the next one to two years?

These compressors would take almost just about two years to install in today’s market. So, we think everybody has that in mind through their future possibilities.

To help Sandy out, currently how much more can you put through the line?

We can push about 2.52, right now.

Or we can move 2.5 right now and we could go up to 3.2 as Sandy said even more if we put our minds to it.

That’s helpful color, thank you and last one from me, Dr, Irani, I’d like to know your current thoughts on Iraq?

On Iraq?

Yes.

Very good question, as you know they are talking about opening up whole bunch of fields there and as you would expect many, many companies are looking at entering there. We have been studying those opportunities. There are huge fields, there are medium fields and there are smaller fields. Realistically the way they are looking at awarding potentially these areas is to consult you and you can bid on as many fields as you want, but can’t have more on the certain amount. In all the probability the very huge fields will be given to consultants, not just any one company, I’m talking, if you want as much as 10 billion barrels or more. Realistically, the super major will probably head those elephant fields and of course we don’t mind participating in some of those and those discussions go on. There are other field, medium fields, smaller fields, some of which we may be able to hope and lead one of those activities. So it’s free of all and lot of interest by a lot of people, how the secured situation materialize so of great importance, because President Obama, as you know is planning to withdraw the troops and this time he is serious and so we have to watch very carefully how all that develops, but clearly in the future of Iraq is one of the key areas that offers opportunities for international oil companies to participate and you know this is going to be a bigger gold rush that in Manhattan and Libya because everybody under the sun wanted to get a piece of the action.

The timing certainly feels any way like it’s more precious, if I think about the scale of opportunities for company like Oxy’s, I guess it would make more sense that round two in September with the higher probability scenario versus round one in June. Is it realistic to think that by 2010 Oxy will be in Iraq in one way or another?

Well, I’m sure that I would like to, but as you know there is a desire for us to be there. But again Iraqis understandably, their government has many other issues to address and deadlines get delayed, changes in some of the bidding conditions change and so on and so forth. So we have a desire, but looking at when this could really bring money to the bottom line, it might take a couple of years, let’s face it. It’s going to take investments and is not going to happen overnight. So, I assure you and would like us to have good news for you by 2010, but I can’t speculate on when it could have any meaningful income.

Your next question comes from Paul Sankey - Deutsche Bank Securities.

Hi, good morning gentlemen. Could you comment on the outlook for M&A, but in an industry wide level in your own perceptive? Thanks.

Yes. Right now, there are some small deals out there, first time we’re seeing a little bit of activity a lot of called farm in activity, people having acreage that they would like to drill and the terms are getting somewhat more attractive. I don’t see any large scale activity at this point. I think we’re still ways away.

I guess if you are talking about nothing until 2010?

No, I wouldn’t be surprised in the back half of the year the rate picked up.

And I guess, with this tracking the indebtedness of the various flavors.

No indebtedness and right now, they’re trying to sell or form out or whatever the right word is, acreage that’s expiring and trying to get people to drill it from and they started out with what we call unattractive terms and they’re getting more realistic, why they are saying there for us I don’t know, but as far Iraq now, they are trying to cut the capital effectively. I think as we move to the year, more interesting things will come loose side of the real guidance, but I don’t know if it will be next year or this year, but I wouldn’t be surprised few more activity in the back half of the year.

Just getting on to the cost issue; your interim production cost down 13.6% full year cost in ’08 and then you said kind of a range of 15, I guess to 40% of the extreme is your expectations to service costs. Would it be reasonable then to assume that your production cost will flow by? Something more towards the 20% to 30% by the time the whole prices work through?

Yes.

Your next question comes from Faisel Khan - Citi Group

Give us a little bit of an update on your drilling activity in Libya and how it’s going and progressing?

I think clearly the best I can tell you, right now Libya is, what it is I mean if things move slower than we expect it and studies continue to take place, but I don’t expect any meaning full increase there for at least another 12 months.

Then if you can comment on the, I know you talked about the net PSC effect which you had in the quarter of about 10,000 barrels a day, but it is looking at Oman being up 35,000 barrels a day versus 27,000 in fourth quarter, is that all reflection of the PSC effect or something else going on there?

No, it’s largely in the PSC.

Okay and what would you say the mix between the most of your activity in Kiznar.

Primarily marginal, as you recall when we took it over from Shale, it was producing 8,000 barrels a day. It’s now in the 50s end of the year 80 and ultimately our contract has been get to the 115,000. So that’s a continuous ramp up of that activity. Sandy could you add to that.

Yes sir. We are on right now just under 60,000 a day, we only have about 25% of the steam capacity commission so far, so we see quite a nice ramp up as Dr. Irani says 80,000 by the end of this year and 150 in the year 2012, we have new drilling rigs out there that are putting in wells faster than we’ve ever done and everything is on track.

Okay, understood and then on shifting to Latin America the volumes in Argentina were pretty substantially sequentially first quarter. Can you give us a little bit color around that too?

Yes, remember they had some strikes and stuff in last year. So it’s basically back to where it should be, point of volume variances I talked about earlier which pretty hard to predict.

Okay, understood and then the shifting to the midstream side equation for a second. I saw your slide we showed us the first quarter ’08 versus first quarter ’09. I was also looking at your supplemental information we gave us for fourth quarter ’08 versus first quarter ’09 and that’s why you had gas processing in NGO prices only affecting the sequential quarter-over-quarter operating profit by $22 million and mark-to-market adjustments expecting the number of $131 million. So I guess I was trying to guess what was the actual cash earnings from that business in the quarter.

Cash earnings of the business is sort of about $60 million, there is a market in our pipeline system, we buy oil from producers and we lock in the margin, which is $1 or $2, let’s say you buy it for an amount of $40 and we sell it immediately for $41 or $42, but that oil doesn’t get there, it may run over the quarter, into the quarter and let’s say oil prices meanwhile have moved up, you have to mark-to-market the change. So, you get that back, it’s not a real thing the real profit is $1 or $2 and so you get a lot of volatility in the number from quarter-to-quarter over the year, it shouldn’t matter. So when prices are coming down, you’ll get nominal gains from it. When prices are going up, you’ll have nominal losses over the end of the quarter. This is why we broke the segment out so that we can see all this noise in it, but there is nothing really fundamental going on, but NGO margins are clearly constrained, natural gas while spread is wide relatively, the actual prices are real low, you are paying $3 for the gas and selling liquids for 43 last quarter, but that magnitude of the spread is shown considerably year-over-year.

Okay, got you and on the tax rate 39% versus 46% I think I understand what’s going on there, but is the entire difference between your guidance and what is actually reported that tax benefit, the relinquishment of those contracts?

Essentially

Okay, got you and then last question on working capital. So I understand that negative $500 million of working capital, does it versatile over the course of the year, is that now?

No. And that was in a slight accrued liability from the fourth quarter. If you want to think of the paying off that obligation in the first quarter that was accrued in first, obviously its effects your cash, when you’re spending less capital your accrued liabilities have to be paid. Normally it wouldn’t make any difference if you where for the level, it always about the same accrued liabilities, but not your accrued liabilities are declining.

Your next question comes from Doug Leggate - Howard Weil.

I’ve got a couple of things on the production outlook; if I could kick off with the press release you could have couple of weeks ago on a volley. Can you give us an update as to when you expect to able to conform with your share of a volley will be and probably the more important question is I am trying to understand where your geological rights and the contacts that the field, because there is clearly a very substantial gas opportunity to deep gas rise in Bahrain. If you could give any color as to what your potential entitlement or potential opportunity is there that would be great and I a have follow up?

On Bahrain well, we expect the sign deal before the end of the month, at least that’s what has been on onsite from the people of Babco two days ago and it looks less likely. So before the end of the month we hope to give you announcement guidance on what the volumes are impacting Oxy. We see a fairly interesting number of potential activities including the one that you will see some more details about within a week or two and as you know when you go into a country you will always look at new opportunities and we’re seeing there are some there. So, it’s a modest field to the measures, but a number of them have beds and we’ve been fortunate to succeed in taking initially the existing oil and gas fields and have the opportunity to increase the production, but we are looking at other things you might do there.

There’s a much deeper gas on that’s being bid out significantly deeper and that’s with this other bid packages Doug.

Do you have underneath the Volley feel that you have right now, do you get the rights to the gas or you have to bid for that as well?

The gas that is being bid out is a much deeper zone, it is separate and we’d be bidding on it of course, but that has to take its course.

Separately, in Colombia, we’ve seen a little bit of activity there appears on the [inaudible] obviously we’ve talked about by looking forward, but it looks like Ecopetrol cannot recently and talked about their net share getting up to something like 30,000 barrels per day by 2011, but was interesting is that appears that you guys have no award of contracts for the water pumps. Can you just talk a little about whether you are actually moving forward to Phase II and what you expect your net share to be because I seem to recall it’s a little higher than Ecopetrol.

The field is moving ahead quiet nicely, we have new very fast drilling rigs putting in rolls again faster than we’ve ever done before and the progress is running around 24,000 barrels a day. So, there are water injection plans and a number of other enhancements. I’m not familiar with the projections on this. Historically, they’ve been fairly optimistic projections as you know.

I guess we don’t going with this deal is that if you take to about 2006. When you laid out your long term production guidance and all the upside potentially talked about is XYZ project happen. You not got a Volley it seems here in parenthesis going well; you have added the SunRidge deal just talking all this level more optimistic about Shell and the in California. So, whenever we’re going to get a revised longer term expectation in terms of your production outlook. Can you just give us an idea for that you think you have actually hit what you about time laid out to be your stretch goal for the projects you’ve got in hand?

But I think we have consistently said over time and we did confirm, in our economic downturn issues to point out, we believe we can grow the business in volume between 5% and 7%. It could be lower in a lower price environment because clearly we are going to put this capital there and our business is not going to be growing in a smooth curve. So we are going to be seeing increases over the next couple of years from both definitely Mohsin that Sandy was talking about from Bahrain, which we would be taking over the operation during the remainder of the year increases potentially and domestically increases as gas prices improve and there is other projects we continue to work about, but we at OXY don’t believe like giving you a number of projects that we are thinking about that may happen, we’d like to have a high degree of certainty before we start sharing with you our thoughts and dreams. So, I can’t sit and tell you that in Iraq we are going to have so much I can, but realistically that’s a wish by me just as it’s a wish by other people. So, we only have a lot place we can drill, Bill will you share with him where how many places you can drill in United States

Yes, Dr. Irani, thank you. We currently have roughly 10,000 locations to drill in the United States with about 6000 of those locations in the Kian’s alone.

Your next question comes from Pavel Molchanov - Raymond James

Thanks for taking my call. In the middle of 2008, you made a small investment in oil sands project in Canada under current economics do you anticipate that project moving forward and if so under what time frame?

Its Qataris runs the project as you know and so there, they delayed until cost come in into line. So, almost everybody up there is waiting cost decrease before they move forward and find Qataris made that announcement a few months ago.

And as a follow up to that, if there are potential opportunities to increase your state either in that project or the oil sands more generally if there are potential opportunities to increase your state either in that project or that oil sands more generally under current commodity prices, would you consider that?

Well, that project is the rest, I don’t see them selling down, they’re probably be more interested in taking our share in the other way. As far as other projects go, we look for quality operators and quality reservoirs and so that’s what limits the opportunities in Canada.

(Operator Instruction) Your next question comes from the line of Robert Kessler - Simmons.

Good morning. I was interested in your commentary about Dolphin, I don’t know unexpected for me in terms of the discussion around the market diversions. Ray, I think you mentioned an instances where the Qataris might not be able to sell the gas to other market they if could differ it and put through the Dolphin line allowing you to ramp up to your capacity there or towards it. Did I understand that correctly and I guess if so I’m curious around the logistics there. My thought was that most of the loss upon projects was somewhat ring fenced from each other in terms of the gas field I’ll be it having some shared utilities if that was planned longer term. So I would have to logistics wouldn’t have been that easy, they can transfer the gas between the various projects based on markets, but because if you thought otherwise?

Yes. Let me start out by and I’ll turn it over to Sandy. Even before we started producing gas form Dolphin, with some gas through, it’s significantly 100 million cubic feet a day brought just from Qatar and Sandy would you give him some feeding on a logistics?

Qatar has the lot of LNG, which is allude to some is pretty well bring fast this lot of domestic consumption there, which has seasonal swing and there at times when there is more available gas and it used in the domestic power generation et cetera or so, sometimes that’s available. Robert Kessler - Simmons & Company International: Okay, that’s helpful, but on [Cross Talk] specifically, would you expect a diversion of LNG sound likes that pretty much because --?

There are some technical interconnections that could be used, but generally speaking the LNG has been as part of the deals that we’re made would be more domestic over supply that we get to use.

Yes I think so, you think it’s a substitute for LNG its not, it an opportunistic understanding between us and Qatar, that they want to have extra gas. It can be used in the UAE and when there isn’t there isn’t. So its not be the alternative to LNG. Qatar has the fair amount is dedicated for its domestic use and how much they need depends on the growth in the construction and other utility and they are sort going up and down and flatways.

Your final question comes from the line of Unknown Participant.

How much price do you think that domestic suppliers would be shutting in gas rather than not replacing it?

I don’t know, I see we’re already shutting in gas current levels.

It’s really hard for us to speculate it, if that as far as new drilling goes at current levels are under economic anywhere. But like other people may do its deep because they think gas price is going to go up soon. We don’t like to go on that theory.

Can people generally without hedges can they generally make money if [inaudible] can we cover with a forecast?

Yes it should be.

Okay, thanks.

There are no further questions at this time. Mr. Stavros

Thank you, very much for joining us today and if you have any further follow up questions don’t hesitate us to call us here in New York. Thanks very much and have a great day.

This concludes today's Occidental Petroleum corporation’s first quarter 2009 earnings conference call. You may now disconnect.