Good morning. My name is Christi and I will be your conference operator today. At this time I would like to welcome everyone to the Occidental Petroleum Fourth Quarter 2009 Earnings Release Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks there will be a question-and-answer session. (Operator Instructions). Thank you. Mr. Stavros, you may begin your conference.

Thank you, Christi, and good morning, everyone. I would like to welcome you to Occidental Petroleum's fourth quarter 2009 earnings conference call. With us this morning from Los Angeles are Dr. Ray Irani, Oxy's Chairman and CEO, Steve Chazen, our President and CFO, Bill Albrecht, President of Oxy's U.S. Oil and Gas operations, and Sandy Lowe, President of our international Oil and Gas Business. In just a moment, I will pass the call over to Dr. Irani who will discuss some of Oxy's achievements during 2009 and also highlight some of our key development projects going forward. Steve Chazen will review our fourth quarter and full year 2009 financial results, discuss some reporting changes that will take effect during 2010, as well as provide some insight on our expected capital program for this year. Our fourth quarter earnings press release Investor Relations supplemental schedules and the conference call presentation slides which refer to Steve's remarks can be downloaded off of our website at www.oxy.com. I will now turn the call over to Dr. Irani. Dr. Irani please go ahead.

Thank you, Chris. Good morning, ladies and gentlemen. 2009 was an interesting year that tested strategic and execution capabilities across the United States oil and gas industry. We believe that Oxy passed last year’s test with an A plus. We achieved solid financial results in a very challenging environment. In a few minutes, Steve Chazen will provide details on our financial results for the fourth quarter and full year of 2009. But first, I want to mention some highlights and key developments of the past year that we believe are integral to Oxy’s continued success in 2010 and beyond. Notably, in 2009 we were able to grow our worldwide production 7% year-over-year while not increasing our net debt to capitalization. This brought us to the highest annual production volume in our history 645,000 BOE per day net to Oxy. We expect a similar increase in oil and gas production both this year and next while continuing to focus on operational efficiency. Also noteworthy, during the next two weeks we will be announcing the official results, but also more importantly our 2009 production replacement. The results look very favorable. We expect to announce that the 2009 reserve replacement ratio is about 200%. In 2009 we maintained our A debt rating across all rating agencies. And we continued to build our pipeline of exciting opportunities, which gives us confidence that our production increases from continuing operations of about 5% to 8% annually over the last five years will again be an achievable target for the next five years. These results are attributable to consistent execution of our long-term financial strategy, as well as a successful companywide initiative to reduce costs. We aggressively managed our oil and gas production costs in 2009’s volatile commodity price environment, reducing our oil and gas production costs…

Thank you, Ray. Net income was $938 million in the fourth quarter of 2009, compared to $443 million in the fourth quarter of last year. 2009 fourth quarter net income included after-tax non-core charges, mostly consisting of a $115 million impairment of certain Argentine producing properties. 2008 fourth quarter included after-tax non-core charges of $514 million for impairments, rig termination costs and plant closures. Core results were $1.1 billion for the fourth quarter of 2009, compared to $957 million in the fourth quarter of 2008. Here is the segment breakdown for the fourth quarter. Oil and gas fourth quarter 2009 segment earnings were $1.6 billion, compared to $339 million for the fourth quarter of last year. Oil and gas core results for the fourth quarter of 2009 were $1.8 billion compared to $1 billion for the fourth quarter of 2008, after excluding asset impairments in both periods and rig termination costs last year. The increase in the 2009 fourth quarter earnings was due to higher crude oil prices and sales volumes and lower operating expenses. Occidental’s average realized crude price of 2009 fourth quarter was $69.39 a barrel, an increase of 30% from the $53.52 a barrel last year. Oxy’s domestic realized gas price for the quarter was $4.37 per mcf, compared to $4.67 an mcf in the fourth quarter last year. Worldwide oil and gas sales volumes for the fourth quarter of 2009 were 650,000 barrels of oil equivalent a day, an increase of nearly 5%, compared to 620,000 BOE per day in the fourth quarter of last year. Daily production volume increased 23,000 BOE a day from Oman and Bahrain, 6,000 BOE from Argentina and 13,000 BOE from California operations, excluding Long Beach. Partially offsetting these increases were lower Middle East volumes of 7,000 BOE a day caused…

Thank you. (Operator Instructions). And your first question is from Doug Terreson of ISI.

On Iraq, Ray, just talk briefly on the contrary and on Iraq I wanted to see if you could expand on the next steps in that country to the best three possible meaning. When do you expect investment activities to commence in earnest and number two? What is the role that gas plays in the consortium with this technical service arrangement that they have, so if you could comment on those two items, I would appreciate it.

Sandy, would you carry on? He is overseeing this.

Thank you, Dr. Irani, good morning. We have teams assembled with (inaudible) and co-gas in Milan right now getting ready. We believe that in the second quarter we will be commencing negotiation of development plans, and kicking off debottlenecking activities so that we can get initial production up. Regarding the question of investment in earnest, this year we'll be mostly debottlenecking and gathering data, studying the data, developing the plans in preparation for much bigger expenditures coming in 2011, 2012.

Okay.

With regards to gas in it, we believe that in places like Iraq, it’s good to have an international consortium. It gives us an increased kind of political coverage. We have European, far eastern, and American company.

Okay. Also, I think Steve mentioned the cash costs and ENP declined by around 15% which is obviously a positive result and so on this point I want to see if you can provide an update as to how you envision this trend unfolding during the next year meaning, are there expectations that expenses are going to decline further and if so any order of magnitude on that capture rate is appreciated?

On the operating expenses, as you know, Doug, the U.S. business is really driven by the gas producers, and not being critical of any one party, they really haven't put a lot of pressure on the suppliers, and so we don't see much change right now in operating costs because oil producers really can't change much, so until the gas producers are a little more disciplined than they've been, I think this is where we are.

Okay, thanks a lot, guys.

Your next question is from Doug Leggate of Banc of America/Merrill Lynch. Doug Leggate - Banc of America/Merrill Lynch: Thank you. Good morning, everybody. I am going to ask couple of, Steve, on California.

I was expecting that. Doug Leggate - Banc of America/Merrill Lynch: Well, I guess an update on the size of the resource. I am not sure if you're ready to give us any update, but could you comment specifically on the type of play that you're actually working on right now? In terms of pay zones, you have got alluded backwards and forwards of these can be quite thick, so if you could actually give us some numbers on that that would be great and related to that maybe some update on the development plan. If it is 200 million let see a midpoint then obviously you have got a whole raft of ways you can go ahead and speed up the drilling there. What exactly do you have in terms of plans for expanding the gas plant beyond skid meant plants you're putting in place in the second quarter and I have a follow-up on your production targets, please.

The pay zones in the gas condensate zone run about 600 feet of net pay. And in the deeper oil zones around 400 feet in net pay. So, it’s fairly thick. And then especially in the common gas condensate zones, pretty good permeability, so you're trading fairly thick segment. So, I think that's probably something. The aerial extent doesn't compare with other things, but it’s very similar as we said in the beginning to an offshore discovery. As far as the gas plant, we really don't know at this point. Their skid mounted thing which may be at 85 million a day is not going to be enough because that's maybe only two wells, so we're probably going to have to get some more and we just don't know how big to build the plant at this point. Every quarter it looks like we need a bigger plant. So we're doing the engineering work. We're starting to build it out. Every time we think we have a handle on it, something else happens which expands the size of the plant. We'll be a little constrained in the next quarter two on gas because we're within our ability to operate at that level give or take 15, 20 million a day so we could get it on. Doug Leggate - Banc of America/Merrill Lynch: Just before I ask my follow-up, Steve, the production number at the end of the quarter, was that the maximum in the quarter or did you have any, I am guessing you're playing around with this a bit. So, you have peaking rates, in which case can you give us some insight what that looks like?

There wasn't the maximum in the quarter now. It was sort what it was at the end of the quarter to provide some kind of consistency. When you're running it over 100 gas plant at 100% or maybe more of stated capacity, especially at older plants, it’s a stretch to keep it running at over 100%, so what you're looking at is sort of what would happen to be the day we measured it. Doug Leggate - Banc of America/Merrill Lynch: Got it. My follow-up is really you have given us an indication of 5% to 8% off the higher base, I guess, for this year for production, but I have to confess I am kind of struggling here because Bahrain is a big slug, California is a big slug, and then you have got the ramp up in Oman and various other things obviously century gas plant. This help us why is 5% to 8% right number? Just looks like you might be sandbagging a little bit here.

We would never sandbag. But I would remind you at your request I think we'll have an update in May. Doug Leggate - Banc of America/Merrill Lynch: Okay. Thanks.

Your next question comes from Robert Kessler of Simmons and company.

Good morning, guys. May be extrapolating a little bit on Doug's questions on Kern County, California. Like to see if you could give us a bit more of update outside of Kern County. Looks like you added three more wells or drilled three more wells in the fourth quarter there I think going back to the last quarter's presentation you had expected seven. Just curious if there is sort of a permitting delay involved there, any significant change in your ex-Kern County exploration plans?

No. Some little permitting. It is just a matter of getting around to it. It may be a little a well was in process or something and didn't get counted.

Sure. Fair enough.

At the end of the quarter.

And then with respect to the Monterey shale, something you haven't talked too much about, I don't believe, and I guess you're not testing that directly so much but correct me if I'm wrong in these sort of 39 wells you have drilled so far but is that fair or have you actually put some let's say multi-stage lateral wells into the Monterey shell and gotten any kind of production response?

We're doing simpler drilling than that, and we are drilling shale wells, and the pace of that is picking up nicely as we move through the year. Whether it’s a Monterey shale or some other shale probably don't want to get into but so far we haven't done much many in the way of high costs opportunities but the low cost ones work just fine, so we'll have more updated added in May also, but the pace of that is picking up nicely and will pick up all year.

I imagine you prefer all equal a nice easily produced conventional low cost conventional well. But anything you can say about an average well productivity out of the shale wells you have drilled so far?

Our average is probably more misleading than informative, so the wells have F&D costs currently with the simple things we're doing of maybe $5 a barrel.

On the conventional side?

No. these are unconventional

Right, okay.

The shale wells if you will.

Okay. Got you. And then looks like you picked up around 200,000 net acres in California over the course of the quarter. Any specifics on where that acreage is located?

It is located in the heart of the producing area around the (inaudible) field, Elk hills and that general area, so it is not way out in the middle of nowhere it’s basically right around where the sweet production is.

Great. Thank you very much.

Your next question comes from Arjun Murti of Goldman Sachs.

Thanks. Follow-up question on California. I believe most of the production you highlight in your slides comes from the gas condensate zones and you were going to be drilling in the oil zones and I believe Steve you mentioned 400 feet of net pay. Can you comment on the drilling results you have seen in the oil zones and when we might start seeing production contribution from those? I am talking about the Kern County area.

I understand. The oil zone is the gas condensate zone is a fairly straight forward zone. The oil zone is I think we have indicated is more complicated. The other problem is that when you drill the oil well is also produces gas and we have a very little plate on capacity. So we ought to be able to see production out of that in the next couple of quarters. But we still need gas plant capacity because even though you might produce 800 or 1,000 barrels a day out of the oil zone, you are still producing 2 or 3 million a day of gas.

That's 800,000 barrels a day per well from the oil zone is what you might think about?

Yeah, initially, and then you also produce gas, so we're a little constrained and also the area we're trying to outline the field so we know how big to build the planted because that's really what's controlling sizable increases in some production.

How many wells have you drilled oil zone thus far?

Bill?

I don't have the exact number, but I would say it is probably on the order of ten.

Terrific. And in terms of gas plant expansions, is there kind of a rough CapEx and maybe relative to size of expansion that we should think about?

It won't be material to the total.

We won't notice it?

It is 100, $150 million sort of number. If you look at the production numbers we gave you for the since the thing began, you will see that we clearly basically the program is paying for itself as it goes.

And let me assure, you we're not going to keep studying the construction of a gas plant. We're doing some engineering and we'll make a decision shortly.

That's fantastic. And then, just a final on a related one in terms of Iraq. Could you provide any comment on how much CapEx it would take to get to the 1.2 million-barrel a day target, I believe Dr. Ray Irani you mentioned and how much your capital spending might be this year and the next few years?

Well, if you want to get to the end, bear in mind we like to look at net cash flow and we have said clearly in our remarks earlier that the exposure to the company in total during the 20 year contract will be less than a $1 billion. Taking into account the fact that this is a very quick recovery of spending, the press mentions all kinds of numbers that seem to cap spending over (inaudible) $20 billion over five years. It is this and that. The advantage of this contract is high early cost recovery. So Oxy's total capital spending in the project will be less than a $1 billion.

That might be your max exposure at one time. Is that a way to think about that?.

That's it. It builds over the first two years but that's it. The cumulative becomes positive, but in a year-after-year.

I got it. Thank you very much for your comments.

Your next question comes from Michael Jacobs of Tudor Pickering Holt. Michael Jacobs – Tudor Pickering Holt: Thinking about the chemical acquisition from Dow and as you think about your company wide portfolio, should we expect the chemical business and perhaps the midstream business as well to continue to grow in pace with your upstream business so that your kind of 80% upstream CapEx and then the associated free cash from the other business remains constant as your upstream business grows?

No. There is no strategy of balancing growth in the chemical business and the upstream business. The chemical business as we have said repeatedly is a solid net cash generator to the company to invest in the upstream and from time to time we opportunistically look at both on acquisitions to our business. Calcium chloride business became available but attractive returns to us and frankly this year with the bad weather it's even performed better than we expected. So we look at things which fit into our marketing and manufacturing capabilities and I think over time one would expect the upstream business will continue to be the major part of the company and maybe growing as a percentage, the midstream which I think is a bigger number. The midstream business is really influenced just this year, last year and this year by the Century plant. Once that plant is done with, the midstream capital will plummet. So the percentage in the oil, instead of going from say 400 million - 500 million in the midstream business is probably going to wind up in the $100 million range. So your percentages will shift even more heavily to the midstream business really supporting the oil and gas. Michael Jacobs – Tudor Pickering Holt: That's helpful. When we think about, on the upstream side, the conventional versus unconventional opportunities in your portfolio and clearly $5 a barrel finding and development costs in California is extremely attractive. Are there other unconventional oil opportunities outside of your current portfolio that could be interesting?

We look at lots of things, and so I think we would be studying everything. It would be fairly hard for us to duplicate the economics in California, but we continue to look. Michael Jacobs – Tudor Pickering Holt: Okay. And just a last follow-up on Doug's question. As we're working through the restated volumes, can you give us an idea of what growth guidance would have been in percentage terms under the old reporting methods?

I don't know. Same order of magnitude. It is just a range that's used that we try to be in the high-end of the range, but it is not really that precise. If oil prices go through the roof, as an example, we can't be on the upper range. So the 5% to 8% we feel is a solid range we can achieve on a sustained basis over the next five years. To speculate it could be on the upper end would be misleading frankly. We think 5% to 8% is a very solid rate of growth maintaining high returns remember. We continue to say we expect high returns and not just growth. So we could grow faster, but we believe that the continued emphasis on efficiency, cost control, CapEx, et cetera, solid discipline across the board, is more important than just uncontrolled high volume growth. And quite frankly, I don't see any company of our size and larger growing at this rate. Michael Jacobs – Tudor Pickering Holt: I agree.

Your next question comes from David Neuhauser of Livermore Partners.

Could you answer me looking forward if some of the other companies out there are looking to right size and somewhat optimize their current portfolios. Are there opportunities that exist out there today that fit within your understanding as where you want to grow that are attractive to Oxy at this point?

There are opportunities. We continue to look at a large portfolio even during times when is people weren't willing to sell. It always takes two to tango and it also depends on the price that people want, but most important as Steve has continually said and I have repeated any acquisition we must add value. We're not going to by assets to have a play on the price of oil or gas. So only we will buy assets when we believe we can increase production, cut costs and get higher value out of those properties. So we continue to be extremely attentive to those opportunities and during the fourth quarter we had a number of opportunities that came along and we took advantage of it. Steve, do you want to add to that?

We don't have any interest expanding our footprint to refining or anything like that and a lot of what's on offer is well returned negative freaking asset businesses.

Is there further opportunities that you see going forward? We have seen a number of acquisitions obviously on the unconventional side with some of the super majors. Do you look at that as the opportunity going forward or are you still more focused on the growth opportunities, organic on the conventional side?

We're always focused on our own stuff first. If we see an opportunity to grow the business that we can add value as Ray said, we will do that. But at this point we have a decent portfolio for the next five years at least. But again we look at everything. So if we can find something that adds value that we can do, that's a reasonable size, we would consider doing that. But we don't feel pressed to do anything.

Your next question comes from Richard Glasebrook of Neuberger Berman.

I had a question on Kern County and then a follow-up. You said the aerial extent was perhaps more modest compared to others as you put. I wondered how significantly you've defined the aerial extent to this state and give some sense of the size of what you have and secondly, you've commented in the past that you've seen no depletion from the reservoirs to date. Has that still been true with an additional quarter?

The first question is we haven't seen the limits of the field yet. So we're not really in a position to say. The aerial extent continues to grow and so we haven't seen the limits of the field. We may have seen it on one side of the field but not the other three sides. So we don't know. On the depletion, the wells generally don't deplete very much and we're also not necessarily pushing the wells as hard as they might at this point. So right now they're holding out pretty well.

Second question is on capital spending or rather on acquisitions. You spent about a $1.1 billion or $1.2 billion in the quarter. Some of that of course included Phibro which (inaudible). Did you say how much the Dow acquisition was?

Dow acquisition was earlier in the year, $210 million. We spent about half the total on oil and gas and the other half in the midstream business.

What kind of volumes were attributable to the oil and gas that you bought?

We haven't said. Obviously if we added 200,000 acres in California last quarter, we obviously spent some money to do that.

Your next question comes from Pavel of Raymond James

Two questions regarding the 200% reserve replacement you referenced. First could you tell us what the main areas for reserve bookings were and then secondly how much higher would bookings have been without year-over-year pricing effects under your PSE?

As I said, if you allow me, you're going to be getting all the details over the next two weeks. It's (inaudible) 200% approximately and we're proud of that. I think let's just wait until you see the announcement and it won't be long.

Your next question comes from (inaudible).

A couple of things. One, can you comment at all about how Phibro has been doing and any expectations you have based on purchase price? What type of results you're hoping for them?

We hope for a lot, but we've only owned it three weeks. So we always hope. They're doing fine, but we only owned them three weeks and they mark-to-market every day. So every day they have a different result. So I don't think we to want speculate on that because we don't know anything.

Would you be expecting to greatly expand their potential risk or decide…

No, no.

Okay. And last question. Can you update us on Argentina and anything that's going on down there?

Do you want to talk about Argentina Sandy?

In Argentina we have a robust drilling program again this year and we're working 25 different fields and production is running just under 50,000 gross barrels a day. So there is nothing unusual to report there. As Steve pointed out there have been some labor relations problems last year on a provincial basis. It wasn't isolated to us but things are looking fine right now and we hope they stay that way.

Do you have their costs in terms of price cap or something like that that will be lifting here hopefully in the not too distant future?

There are constraints to the sale and it's complicated as to how we sell on the internal market versus the export market and there is a number of allowances that we've been able to earn by increasing production in certain provinces. So it is improving. But it is always subject to local political considerations.

(Operator Instructions). Your next question comes from Doug Leggate of Banc of America\Merrill Lynch. Doug Leggate - Banc of America\Merrill Lynch: Sorry for the follow-up, folks. I wanted to circle back on one thing you said in your prepared remarks, Steve about free cash flow of $850 million in the quarter I guess after dividends, CapEx, and so on. Obviously if that's the run rate, we're looking at north of $3 billion of cash in a given year. I'm just curious as to what your latest thoughts are about how you're going to manage that given that you’ve now given us a fairly modest CapEx budget for the year?

We almost never build cash. Our cash I don't think has ever hit $2 billion. So I think we'll keep the cash, one way or another we'll find opportunities. I think this is probably a pretty decent year for opportunities for us outside of the capital program. We see a little more activity in some of our areas. While we didn't spend a lot in Permian last year, we still did 21 deals. So I think it's fairly especially [active] and specially for private people who are worried about their tax rates. So I think we'll have a pretty decent year for acquisitions this year and if there is excess cash, we'll be responsible in returning it to shareholders one way or another. Doug Leggate - Banc of America\Merrill Lynch: Is there a visible pipeline right now Steve that you could speak to?

I don't want to speak to it but there is clearly stuff out there. It is clearly more active than it was say six months ago. Doug Leggate - Banc of America\Merrill Lynch: Terrific.

Your next question comes from David Wheeler of AllianceBernstein.

My question has been answered.

And there appear to be no further questions. Are there any closing remarks?

No. That's all we have from Los Angeles in New York. Thank you very much for joining us today and if you have any follow-up questions, feel free to call us in New York. Thank you again.

Thank you. This does conclude today's conference call. You may now disconnect.