In announcing the results, Ray R. Irani, chairman and chief executive officer, said, In the first quarter, Occidental achieved a nearly eight percent growth in year-over-year oil and gas production. In addition, we have made significant progress in our continuing cost reduction efforts and we will continue to invest in the long-term growth of the Company. I am pleased with our effectiveness in adjusting to the ongoing volatile market conditions.
Oil and Gas
Oil and gas segment earnings were $545 million for the first quarter of 2009. After without including rig termination costs of $8 million, for the first quarter of 2009 core results were $553 million, compared with $2.9 billion in the year-ago quarter. The $2.3 billion decrease in the first quarter 2009 results reflected lower crude oil and natural gas prices and higher DD&A rates.
For the first quarter of 2009, daily oil and gas sales volumes averaged 654,000 barrels of oil equivalent (BOE), compared with 607,000 BOE per day in the year-ago quarter. Volume raises were 22,000 BOE per day in domestic operations, largely in the Rockies and California, 15,000 BOE per day in Oman, and 10,000 BOE per day in Argentina.
The company’s realized price for worldwide crude oil was $39.29 per barrel for the first quarter of 2009, compared with $86.75 per barrel I the year-ago quarter. Domestic realized gas prices decreased from $8.15 per thousand cubic feet (MCF) in the first quarter of 2008 to $3.54 per MCF for the first quarter of 2009.
Oil and gas cash production costs, including taxes – other than on income, reduced from $14.75 per BOE for the total year 2008 to $12.19 per BOE for the first quarter of 2009.
Midstream, Marketing and Other
Midstream segment earnings were $14 million for the first quarter of 2009, compared with $123 million in the year-ago quarter. The earnings decline for the first quarter of 2009 reflects considerably lower NGL prices in the gas processing business and negative mark to market adjustments in crude oil marketing.
