Occidental Petroleum 2002 Annual Report Download - page 6

No significant portion of OxyChem's business is dependent on a single
third-party customer. However, OxyChem has entered into significant sales
arrangements with certain of its affiliates and partners. In 2002, PolyOne
purchased from OxyVinyls raw materials pursuant to PVC resin and VCM sale
contracts at market-related prices valued at approximately $179 million. Also,
OxyMar sold VCM resin at market-related prices valued at approximately $309
million to OxyChem affiliates in 2002. OxyChem generally does not manufacture
its products against a backlog of firm orders.
COMPETITION
Occidental's chemical business competes with numerous producers. Since most
of OxyChem's products are commodity in nature, they compete primarily on the
basis of price. Because OxyChem's products generally do not occupy proprietary
positions, OxyChem endeavors to be an efficient, low-cost producer.
CAPITAL EXPENDITURES
For information on capital expenditures, see the information under the
heading "Capital Expenditures" in the MD&A section of this report.
EMPLOYEES
Occidental employed 7,244 people at December 31, 2002, 5,878 of whom were
located in the United States. Occidental employed 2,827 people in oil and gas
operations and 3,370 people in chemical operations. An additional 1,047 people
were employed in administrative and headquarters functions. Approximately 666
U.S.-based employees are represented by labor unions.
Occidental has a long-standing policy to ensure that fair and equal
employment opportunities are extended to all people without regard to race,
color, religion, ethnicity, gender, national origin, disability, age, sexual
orientation, veteran status or any other legally impermissible factor.
Occidental maintains diversity and outreach programs.
ENVIRONMENTAL REGULATION
For environmental-regulation information, including associated costs, see
the information under the heading "Environmental Expenditures" in the MD&A
section of this report.
AVAILABLE INFORMATION
Occidental makes the following information available free of charge through
its website at www.oxy.com:
>> Forms 10-K, 10-Q, 8-K and amendments to these forms as soon as reasonably
practicable after they are filed electronically with the SEC;
>> Other SEC filings, including Forms 3, 4 and 5; and
>> Corporate-governance information, including its corporate-governance
guidelines, board-committee charters and Code of Business Conduct.
ITEM 3 LEGAL PROCEEDINGS
For information regarding lawsuits, claims, commitments, contingencies and
related matters, see the information in Note 9 to the Consolidated Financial
Statements.
In April 1998, a civil action was filed on behalf of the United States
Environmental Protection Agency (EPA) against OxyChem relating to the Centre
County Kepone Superfund Site at State College, Pennsylvania. The lawsuit sought
approximately $12 million in penalties and governmental response costs, a
declaratory judgment that OxyChem is a liable party under the Comprehensive
Environmental Response, Compensation, and Liability Act, and an order requiring
OxyChem to carry out the remedy that is being performed by the site owner. In
October 2002, the U.S. District Court for the Middle District of Pennsylvania
approved a Consent Decree between OxyChem and the United States. Pursuant to the
decree, OxyChem agreed to pay to the United States and the site owner a total of
$886,000, which included payment of a $21,000 penalty to the United States and
an obligation to fund a supplemental environmental project to acquire an
environmental easement for up to $84,000, in exchange for, among other things, a
release of all past and future response costs associated with the site and
dismissal of the United States' lawsuit, with prejudice. In November 2002, all
payments required under the Consent Decree were made, except the amount for the