Oxy's LatAm Oil Output Up 34% in 2004

US oil company Occidental (NYSE: OXY) increased its oil production in Latin America 33.9% to 83,000 barrels a day (b/d) in 2004 compared to 2003, the company said in its fourth quarter earnings statement Monday.

Occidental's Ecuadorian crude production rose 84% to 46,000b/d, while Colombian crude output remained steady at 37,000b/d in 2004.

Occidental has a contract for the Caño Limón oil field in Colombia. And in Ecuador, the company has an exploration and production contract for block 15, with partner Canada's EnCana.

Ecuador's government has threatened to kill Occidental's block 15 contract, saying the company sold a 40% state in the block to EnCana without the government's permission. Occidental says it is hopeful the dispute will be resolved.

The company's western hemisphere president John Morgan said in a conference call Monday that the situation has not affected production.

In 2004, Occidental evaluated six wells in Ecuador. Commercial quantities of hydrocarbons have been discovered in five of the wells and the company has begun work on a seventh well. In Peru, Occidental has drilled a wildcat well and the company is "moving on to drill a second structure," Morgan said.

This year's capital expenditures in Latin America are expected to drop from US$180mn in 2004 to US$80mn, CFO Stephen Chazen said in the conference call, without providing specifics. Occidental's global net income for its oil and gas business in the fourth quarter was US$977mn, up 54%. Oil and gas revenues for the 12-month period increased 33% to a record US$3.5bn, the company said.

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