Those who remember the globe-trotting Armand Hammer may think of Occidental as the ultimate multinational, but it generates two-thirds of its revenue from the U.S., mainly Texas and California. It also has wells in Latin America, the Mideast, and Libya. Oxy avoids competing head-to-head with the supermajors by focusing on older fields that aren’t gushing crude anymore but still have plenty of oil in place. Thanks to cost-cutting under CEO Ray Irani, who took over upon Hammer’s death in 1990, Oxy has fat profit margins: over $20 a barrel in 2006. The perennial question: When will it get gobbled up? CFO Stephen Chazen says Oxy isn’t for sale as long as management “keeps creating value in excess of the cost of capital.” Analyst Fadel Gheit of Oppenheimer says Oxy’s not a great fit for everyone but could appeal to ConocoPhillips or Royal Dutch Shell.
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