Good morning. And welcome to the Occidental Petroleum Corporation Fourth Quarter 2013 Earnings Conference Call. (Operator Instructions) I would now like to turn the conference over to Mr. Chris Stavros. Please go ahead.

Thank you, Emily and good morning, everyone. Thanks for participating in Occidental Petroleum’s fourth quarter 2013 earnings conference call. On the call with us this morning from Houston are Steve Chazen, Oxy’s President and Chief Executive Officer; Vicki Hollub, Executive Vice President of Oxy’s U.S. Oil and Gas Operations; Cynthia Walker, our Chief Financial Officer; Willie Chiang, Oxy’s Vice President of Operations and Head of our Midstream Business; Bill Albrecht, President of Oxy’s Oil and Gas in the Americas; and Sandy Lowe, President of our International Oil and Gas Operations. We are going to change things up a bit this quarter and begin the call with comments from our CEO Steve Chazen who will review some of the achievements we realized last year with respect to the fundamentals of our business and our strategy and plan for 2014. Vicki Hollub will then provide a thorough discussion on the strategy and outlook for our operations in both the Permian basin and California. In order to provide a little more current for discussion around our domestic oil and gas operations, we will not directly address our fourth quarter results on the call. However Cynthia Walker’s detailed commentary on the fourth quarter as well as forward looking guidance items can be found in the conference call slides sent to you following Vicki’s remarks and beginning with Slide 46. As a reminder, today’s conference call contains projections and other forward-looking statements within the meaning of the federal securities laws. These statements are subject to the risks and uncertainties that may cause actual results to differ from those expressed or implied in these statements and our filings. Our fourth quarter 2013 earnings press release, the Investor Relations supplemental schedules, conference call presentation slides, as well as Cynthia’s detailed commentary on the fourth quarter results have been posted and can be downloaded off of our website at www.oxy.com. I’ll now turn the call over to Steve Chazen. Steve, please go ahead.

Thank you, Chris. We just finished a successful year meeting or exceeding many of the goals we set out for ourselves and are looking to continue our performance into 2014. Let me give you a brief overview of the key 2013 highlights. We grew our domestic oil production by 11,000 barrels per day over 2012 to 266,000 a day. We exceeded our capital efficiency goals reducing our drilling costs by 24% from the 2012 levels, reduced domestic operating costs by 17%. We added about 470 million barrels of reserves equivalents achieving overall replacement ratio of 169%. Our total costs incurred associated with those reserve adds were about $7.7 billion, resulting in repair and finding and development costs of under $17. We increased our return on capital employed from 10.3% in 2012 to 12.2% in 2013. Turning now to some of the specifics of the key accomplishments of last year. As a result of our development program, we improved our capital efficiency by 24% domestically over 2012, which translates to about a $900 million reduction in capital for the wells drilled in 2013. Of this improvement, 50% came from the Permian basin, 25% from California and 25% from the rest of domestic assets. We accomplished these improvements while successfully completing our program by drilling approximately what we had planned. We also reduced our domestic operating costs by 17%, or about $470 million compared to 2012. About 48% of this improvement was in the Permian basin, 46% was in California and the remainder was in their other domestic assets. While we focused on these efficiencies, we also grew our domestic oil production by 11,000 barrels a day. With respect to reserves, we had a very successful year in growing the company’s reserve base by adding substantially more reserves than we produced. Over…

Thank you, Steve. This morning I’ll review two of our largest domestic operations: our Permian and California businesses – describing our 2014 plans as well as longer term growth opportunities. In 2013, we implemented an important transition plan in both of these businesses. And the success we achieved built a solid foundation for long-term growth. In 2014, the specific goals of our operations are continue the development of our large anchor projects in each of our operating areas. Which will enable us to allocate a significant portion of our capital to projects with solid returns, low execution risk and long-term growth, further reduce our drilling and completion cost to improve our finding and development cost and our project economics. Continue to optimize operating cost without affecting production to improve our current earnings and free cash flow. Build on our successful exploration efforts in each of our core areas. Evaluate data and test various new concepts in our pilot areas which will setup the anchor projects of the future. We manage our Permian Basin operations through two business units. The Permian EOR business which combines CO2 and water floods and the Permian Resources business which is where our growth-oriented and unconventional opportunities are managed. I will refer to the CO2 water flood business as Permian EOR and the other business as Permian Resources. The Permian Basin designation will be for the combined operations. In the Permian Basin we spent over $1.7 billion of capital in 2013 with 64% focused on our Permian Resources assets. In 2014, we plan to spend just under $2.2 billion overall in the basin. The entire $450 million increase will be spent on our Permian Resources assets representing about 70% of our total capital spend in the basin. We expect the Permian EOR business to offset this…

Emily, can you please open the line for questions, we’re ready to take questions thanks.

(Operator Instructions) Our first question from Doug Terreson of ISI, please go ahead. Doug Terreson – ISI: Good morning to everybody. Steve, Oxy’s returns on capital rose last year by almost 20% which I think was the objective or the hope anyway but your capital spending looks like it's going to rise by another 16% or so this year. And so my question is how does management prevent capital misallocation and then retrenchment from occurring again as it did a couple of years ago? Meaning, have there been changes to the capital allocation process or in other areas of corporate planning that might enhance the result in the current scenario?

Yeah, sure. Thank you, first remember that this number is for unchanged business. Doug Terreson – ISI: All right.

And that’s really not going to happen so the actual spending will be some other number, a lower number because some other businesses won’t be here by year-end. Doug Terreson – ISI: Right.

We’re being – we’ve changed the process, I think Vicki has pointed out that the change in the domestic business and how we’re – what we’re focusing on returns are lot better and we’re not – I think it's basically a lower risk portfolio and will generate more certain returns. We expect the returns we’re not actually excited about the 12% return on capital employed. I think we need to be closer to in excess of 15% and so our goal is to make sure that’s right. We’re -- it's like we’re very great caution on my part that I’ve allowed additional spending in Permian and California, they’ve had to convince me that they’re going to stay on the straight and narrow here. So I’m pretty sure we’re under control but if it turns out because we’re going to watch this monthly because that’s what we do now, we watch it monthly. It turns out and get off to the wagon and they’ll – the beer will be turned off. Doug Terreson – ISI: Okay, one more questions you guys also were.

Or the fine wine whatever they’re drinking you know. Doug Terreson – ISI: So you guys were obviously very successfully with your cost program that helped the result last year and so most of the complete is there more work to do there on the cost product program?

For sure, while I’m – I think we exceeded our goals. Doug Terreson – ISI: Right.

We’ll set new goals. I think my main focus just so we were real clear, the long-term business depends on low F&D, operating costs are fine but they affect the current year but we have to develop a long-term low F&D rate and go back to what we said forever. If we have the F&D and the operating cost and local taxes we need to be below the 50% of the selling price of the product. And if you’re going to do that you have pre-tax margins of 50% and you’ll generate good returns and that’s really the objective and so we need to continue to drive as the reservoirs become more challenging, need to cost or cost need to be watched very carefully. I think you know we’ve used this year 2013 at this to really horn our ability to control costs and I think we’re there. We’ve gone through a multiyear transition of the company from you know from a very good international producer and you know an okay domestic one to a much stronger domestic business and this has been a not an easy or quick transition but I think at this point we have the people in place to accomplish those goals going forward. We’re giving them more money this year but I hold myself and them responsible, unlike football teams the coach gets fired not the assistant coaches in this. Doug Terreson – ISI: Well if you guys can make 15% returns on capital that’d be fantastic. Thanks a lot.

I think we’ll be there. Doug Terreson – ISI: Nice thanks.

Our next question is from Doug Leggate of Bank of America Merrill Lynch, please go ahead. Doug Leggate – Bank of America Merrill Lynch: I have a couple also if I may. Telefonia [ph] has I guess been judged to some extent as not been able to execute because of lack of visibility, so do you believe that’s in targets this morning obviously that suggests the step–up in activity but what comfort can you give that you have got the permitting, you have got the rig count. And I’m just curious as to where you’re headed in terms of how – whether or not separating California still a viable option and one that you think would benefit the balance of the portfolio?

Yes, I’ll answer the last question first and then we’ll let Vicki, assistant coach here, get ready to answer, how certain she is. At California and the Permian and the rest of the company are quite in some ways different businesses. California can benefit a lot I think. My higher capital spending will generate more growth. We established a base with we might call boring if you want, steam flood and those kind of projects, so they will have enough cash flow to go ahead. I think it could be managed differently than we would and I think it has good prospects, I think the issue that we need to have a team together that is more aggressive growers, maybe less concerned about dividends and more like E&P, small E&P. No one will lever -- three producers or 85% of the production in California and that isn’t going to change. And so, there is never going to be a comp and make people to believe and for the management of that business to deliver, it's probable, but they should be separate. Is that clear enough? Doug Leggate – Bank of America Merrill Lynch: Yeah. That is clear enough.

With respect to our efficiencies, I feel like in California certainly we have a lot of potential as we outlined in detail in the earnings call a couple times ago. So we have the resources available. We have now put together a team out there that's structured in a way, that gives them the best opportunity of success. We have great people, we have very experienced people who are -- who know a lot about operating in California, who know a lot about the types of projects that we're developing, that's our core business. We know water floods, we know steam floods and that's the bulk of what we're doing. So our team understands quite clearly how to do that and they are among the best in the industry. And so, we're accomplishing what we've said we would do and what we're doing going forward that with this increase in capital is we're being very disciplined about how we evaluate and design our projects and implement our projects. So I'm quite certain that we're not going to lose our efficiency around execution and with the resources that we have, I feel confident that we're going to continue to see the same results that achieved in 2013 going forward. Doug Leggate – Bank of America Merrill Lynch: Given that you have been fairly clear about how this could play out, Telephone [ph] has not been spending its cash flow up until now. So as a standalone company would there be an intangible drilling cost uplift to the operating cash flow in your estimates? And I guess if I could lay on it, very quickly, latest stuff thoughts on the scale of a potential Dutch tender buyback if that's still in your thinking and I'll leave it here. Thanks.

Obviously, California would spend more money and drill more wells until they could generate a lot of tax shelter, if that's the question. Doug Leggate – Bank of America Merrill Lynch: Yeah.

A separate business who competes with – a separate oil company that competes with other medium size or whatever you want to call on producers, obviously is a business that would generate, you basically burn, you use its cash flow. California has the flexibility however so that it could cut back its capital and use money to repurchase shares or something like that, if the right sort of environment came down. Unlike some other things, it's a pretty complete business that has -- fair amount of gas opportunity when that's available. It has all saves [ph], long term oil and has some exciting oil things to do too. So I think it's a fairly complete business and it’s a business where, if things get bad for regulator regions or price or whatever, it can cut its capital back, still do well, doesn't get caught on a cred mill of higher decline, could even buy back shares. I don't think it's going to be a big dividend producer but I think I think on share repurchase, it could do that if conditions warrant, but if conditions don’t warrant, I am sure they will spend all that money. The process of repurchasing the shares from whatever we do, it just depends on the situation at the time. When we have the money we'll figure it out, when we have the money in the hand, we'll figure out exactly what the process will be. But I’d point out that we repurchased around 10 million shares in the fourth quarter, we wouldn't have done that with the shareholders’ money if we thought that, all this wasn't going to happen. So I think the process of doing it remains to be seen, because you might have -- one oil, one stock price you might do one thing and another you might do something else. But, there’s no other place to put it. I mean, it’s either some kind of share repurchase or – you know, there isn’t really any debt that we can do much with. So, I think we’ve taken down the debt. I think the next maturity is in 2016 and I’m not up for, you know, some kind of windfall for bond holders. Doug Leggate – Bank of America Merrill Lynch: I’ll let someone else jump on. Thank you.

Thank you.

Our next question is from Ed Westlake of Credit Suisse. Please go ahead. Ed Westlake – Credit Suisse: Yeah. I mean, I guess I got a bigger picture question just on Permian and then some follow-ups on California. So, those two question and just on your Permian, I mean how do you think you’re going to get a fair price for the light oil that you’re producing in Permian? What is Oxy going to do about it over and above what you’ve already announced, you know, with the BridgeTex Pipeline extension? Thanks.

We’re going to let Willy answer that since he’s the expert in oil.

Yeah, Ed. Obviously, we’ve seen a lot of disruptions in pricing between regions and we’re seeing a lot of infrastructure getting built in and when we look at our production of roughly 15 million barrels a year or 150,000 barrels a day out of the Permian, between the BridgeTex Pipeline which goes from essentially Midland or Permian directly to the Gulf Coast as well as taking capacity on other pipelines down to Corpus we essentially go from a two market business, Midland and Cushing to ultimately getting to Houston Ship Channel as well Corpus and then we also get the ability to go to U.S. East Coast and lots of different places. So, I think the infrastructure is going to help us tremendously in that area. Ed Westlake – Credit Suisse: As a follow-on. I guess, people are concerned that when the crude goes down to the Gulf it’s still going to be impact. Any thoughts around that, what work you’ve done on that?

Well, the thing everyone looks at is the Brent/TI. And as I think about it, Brent’s really tied to world prices and I think what you’re going to see is all the grade as well TI kind of come to transportation parity. Ed Westlake – Credit Suisse: Okay. So, no major discounts in your thoughts for the crude once it gets down to the Gulf other than quality and logistics?

No, I think prices fix the price issues. Ed Westlake – Credit Suisse: Okay. So, just –

I’ll also point out that Ed Westlake – Credit Suisse: I thought you might.

Yeah. That, you know, $97 is probably okay for us. I mean, this isn’t some bargain basement price. So, yeah, we feel pretty comfortable that we could be reasonably profitable at $97 and much lower, so. You know, sometimes you lose sight of the absolute price in all this talk about differential. Ed Westlake – Credit Suisse: Yeah, it’s a good point. Just on California then. I mean, you gave us sort of some initial resource estimates for the Permian, would you be willing to give us the resource estimates for California? I know people are obviously trying to have confidence and resource numbers from yourselves would obviously help their confidence.

I think what I prefer to do is leave that for another day and another kind of announcement. Ed Westlake – Credit Suisse: Okay. Well, thanks very much.

Our next question is from Arjun Murti of Goldman Sachs. Please go ahead. Arjun Murti – Goldman Sachs: Thank you. Just another follow-up on California where you have a nice growth trajectory here. It sounds like the greater confidence and it is there is a bit of a mix here where some of the stuff that’s declined is now smaller and you’re shifting more to water and steam floods which you’ve historically been very good at and maybe less reliance on the unconventional, at least in the scope of the years presented here, is that accurate? And, I guess, if so where are you on the unconventional from the confidence standpoint? Thank you.

I’ll let Vicky answer about the unconventional but just so you understand, I think you’ve got it but, you know, we have the high decline and really no decline – high decline at Elk Hills and really no decline at THUMS, which was the bulk of the production of the Company and originally was nearly 100%. And so what’s happened is that the little wedge has grown and we’ve made a lot of progress in improving the decline rate in Elk Hills, so we’re not fighting as big a decline curve. And so what we’re doing is we’re filling it in with things that are real certain so that the business has sufficient cash without being on a treadmill with the go forward. And I’ll let Vicki talk about the unconventional here, since she’s more knowledgeable than I am for sure.

This year we’re drilling 170 unconventional shale wells versus 111 that we drilled last year. So we increased the number that we are drilling this year and actually we had hoped to drill even more than we currently have on the schedule. But we felt like that from a regulatory standpoint, it was best to take a more conservative approach this year and be our best before. We do have some exciting unconventional projects that are in the permitting process and we expect to bring those on in 2015. So basically part of its permitting, just trying to get the permits in line and ready to go. The other part of it is that we are continuing with the strategy that we developed and that is to as we’ve said lower our decline and build up a larger solid base of those types of projects. And that really helps prop us up for the unconventional development. Arjun Murti – Goldman Sachs: Is it a question Vicky of the scope of what you have there? You aren’t sure you have enough running room between confidence in the resource and the ability to get permits, or are there still questions on all those points?

Yeah there are questions on all of them. We do have, as I said, unconventional plays that we feel very comfortable with the development of because there are things that we understand that we’ve already started the process of development. So there is a portfolio that we feel like we could move forward at a fairly fast pace if we had the permitting in place. There is still some shales that we haven’t really tested and evaluated yet and we’re taking the same approach in California as we are in the Permian where we are doing a more measured approach to go out, drill a few wells, do some evaluation, then start some pilot projects and then from there progress to full field development. So we are trying to be very prudent in the way that we approach our shale plays that are outside where we’re currently drilling. Arjun Murti – Goldman Sachs: Steve, maybe just a follow up on the MENA comments. I certainly appreciate the scale and complexity here and that’s going to take some time. Can you comment that you have identified maybe a partner group which is a key group you are negotiating with and these things can still take time or is it earlier stage than that where there is still multiple parties that are involved here?

No, there is a partner group. Arjun Murti – Goldman Sachs: That’s great. And then just a final one on the stock buyback. Should we think about this primarily as asset sale proceeds are used for stock buyback or your balance sheet is strong that it can be an ongoing program even without proceeds?

The business fundamentally, the overall business or whatever remains in the company is able to generate free cash. And so we should see a part – I think I said it at your conference, part of the program will continue to grow the dividends at a healthy pace. We’ll have a little more share repurchase than we’ve done historically. You will see share reductions from whatever happens in the asset sales or whatever dividends we might take from anything we separated from company. So I think you’ll see the share count come down and therefore the dividend requirement, the dollar amount of dividend requirement come down. So I think you’ll see a mix, but we’re very – I’m very focused on the value of the stock we’re buying. It isn’t just about buying shares for fun, certainly easier than drilling wells. But I think that we’re – and you’ll see us come and go as the stock price changes and of course there are periods when we can’t buy where we have material information. So there may be periods when we can’t buy. But generally you should expect to see a regular program at some level but also some fairly sizeable reductions over the next year I would expect. Arjun Murti – Goldman Sachs: Great. Thank you so much.

Thanks.

Our next question is from Faisel Khan of Citigroup. Please go ahead. Faisel Khan – Citigroup: Thank you. Good morning. Steve, I was wondering if you could clarify some of the comments you had around return on capital employed. So are you saying that – and you guys have made a tremendous effort in getting return on capital employed up over the last 12 to 24 months. But I want to make sure I understand. So are you saying that with CapEx going up next year and with sort of the double end of the rig count in the Permian over the next few years and adding seven rigs on California, overall, you’re seeing ROC should trend up over the next one to two years, all else being equal?

Product prices aside, yes. Faisel Khan – Citigroup: Okay, okay, fair enough. And then in terms of your comments on California, given that most of your growth in California is sort of longer life production and some of your growth in the Permian has sort of a higher decline rate, I mean doesn’t it make more sense to kind of keep those assets together as a portfolio? What’s the – I’m just trying to understand like how you balance the cash flow and decline rate over the two portfolios over time.

Remember the Permian is respectively two businesses, there is the EOR business which generates large amounts of free cash flow. So the question really is how do you – and it has a potential to add this high growth stuff but still generate large amounts of free cash flow as a business, we can manage that reasonably well. California, the potential is currently managed to generate free cash flow and it will generate a base ultimately of these long lived projects, which basically the way answers to some extent your question about the returns because you could turn on a long live project your D&A rate will be relatively low and so your earnings will be better because you got a lot of reserves over long period. But – and so every business, a standalone business has to have a base of money to pay for itself, now I understand there is a whole bunch of companies out there that don’t. But that’s not the way to build the long term oil business. So California can spend more fairly I think easily and continue to grow. And in the Permian there is a lot of competition for rigs and people and so I think it’s a little more challenging in the Permian. I think California, I have a map in my office from 1679 which shows California as an island and there is some proof to that. Faisel Khan – Citigroup: Do you guys have an estimate for the return on capital employed for California at the end of the year?

I don’t think so. I think we will leave those kinds of questions for some other announcement.

Our final question will come from Roger Read of Wells Fargo. Roger Read – Wells Fargo: You mentioned in the preview part the costs and the learning curve issues, have you done anything in particular to hire people out there or has it been learning by watching, learning by sharing info and data with some of your partners out there.

I think Vicki went through a long – we have got a lot of gross wells that – bulk of the production and outcome comes from our own net wells. So we see enormous exposure what other people are doing. We don’t actually have to experiment or hire other people, we can actually see what they are going. We hire people all the time but we are not hiring people from radically different cultures. We need people who are trained in a return driven free cash flow kind of culture. And to hire somebody from some small company they really have a different kind of culture, they’re more an IRR getting their money back quick and drilling more wells culture. So we don’t want to destroy the notion that this is a business by generating money and generating returns and we are not going to spoil – we’re not going to spoil the stew with a bunch of others [ph]. Roger Read – Wells Fargo: I guess as a follow up, even to those comments, if I remember correctly, we are in a new CEO search mode here. Is there any update you can provide on that front?

I think the board will have something to say about that next month. But I expect that I’ll be doing significantly more earnings calls than I had planned.

In the interest of time this concludes our question and answer session, I would like to turn the conference back over to Mr. Stavros for any closing remarks.

Thanks everyone for joining us today and please call us with any follow up questions in New York. Thanks again.