Occidental Replaces 206% of 2009 Production
Occidental announced that at year-end 2009, the company's preliminary worldwide proved reserves totaled 3.23 billion barrels of oil equivalent (BOE) compared to 2.98 billion BOE at the end of 2008. In 2009, the company had proved reserve additions from all sources of 483 million BOE, compared to production of 235 million BOE, for a production replacement ratio of 206 percent.
Dr. Ray R. Irani, Chairman and Chief Executive Officer, said, "We are pleased to have replaced 206 percent of our 2009 production largely through improved recovery and extensions and discoveries. Over the last three years, we replaced 160 percent of our production. Our finding and development costs in 2009 were $7.90 per BOE. For the last three-year period, our finding and development costs averaged about $15.10 per barrel."
As of December 31, 2009, 73 percent of the Company's proved reserves consisted of oil and 27 percent of gas. Of the total proved reserves, approximately 64 percent was in the United States and 36 percent were located in international locations. Approximately 23 percent of the proved reserves were proved undeveloped and 77 percent were proved developed.
Of the total reserve changes, improved recovery, which reflects the Company's enhanced oil recovery activities, represented 173 million BOE of proved reserves additions, mainly in California, Permian and Oman, through the Mukhaizna project.
Extensions and discoveries added another 92 million BOE of reserves, mainly in the Kern County discovery area, with smaller additions internationally. The Company added another 160 million BOE through purchases of proved reserves largely consisting of several domestic acquisitions in California and New Mexico and reflecting the Bahrain Field redevelopment project.
Revisions of previous estimates provided a net 58 million BOE additions to reserves. The additions included a net positive effect from production sharing contracts in the Middle East/North Africa. Domestic positive oil price-related revisions were more than offset by negative gas price-related revisions, and other changes in the United States and Argentina.
Occidental's costs incurred for exploration and development activities and acquisitions were $3.8 billion. The acquisition costs were primarily domestic, mainly in California and New Mexico.
For the three-year period 2007 through 2009, Occidental's proved reserve additions totaled 1.1 billion BOE, and total production equaled 663 million BOE, for a reserve replacement ratio of 160 percent. Total costs incurred during this three-year period were $16 billion.
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