SECURITIES AND EXCHANGE COMMISSION
Washington, DC. 20549
FORM 8-K
Current Report Pursuant
to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported) November 26, 1997
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UNOCAL CORPORATION
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(Exact name of registrant as specified in its charter)
Delaware
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(State or Other Jurisdiction of Incorporation)
1-8483 95-3825062
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(Commission File Number) (I.R.S. Employer Identification No.)
2141 Rosecrans Avenue, Suite 4000, El Segundo, California 90245
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(Address of Principal Executive Offices) (Zip Code)
(310) 726-7600
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(Registrant's Telephone Number, Including Area Code)
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Item 5. Other Events.
On November 26, 1997 the following news release was issued:
MECHANICAL PROBLEMS, MARKET CONDITIONS
LOWER EARNINGS FROM UNOCAL MOLYCORP UNIT
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El Segundo, Calif., Nov. 26, 1997 - Unocal Corporation today said that
mechanical problems at the company's Questa, N.M., molybdenum mine and continued
competitive pressures from Chinese lanthanide producers are expected to reduce
earnings from its Molycorp, Inc., subsidiary by $10 million (aftertax), or 4
cents per Unocal common share, in the fourth quarter 1997.
Unocal's carbon and minerals segment, which includes Molycorp and the
company's graphite and petroleum coke operations, is now expected to break even
in the fourth quarter 1997. The segment reported adjusted earnings of $10
million (aftertax) in the third quarter 1997.
The mechanical problems at Questa involved a conveyor belt that
transports the ore from the mine to the mill. A portion of the belt broke in
early November, causing a shutdown in production. While repairs are being made,
Molycorp is doing additional development work in the mine to improve the ore
grade.
The company expects the mine to resume operation in early December, and
the mill, which separates the molybdenum, will be back on-line by mid-December.
The company reduced its workforce at Questa by 68 workers to adjust for reduced
output because of changes in operations that have lowered ore throughput.
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Molycorp expects to resume shipments of molybdenum from Questa to its
roasting contractors in January.
Molycorp's lanthanide business continues to
face lower margins and sales volumes due to intense competition from China
producers. In response, Molycorp restructured operations at its lanthanide mine
and processing facility at Mountain Pass, Calif. This restructuring has
eliminated about 60 hourly, supervisory and management employee positions while
reorganizing around a team management organization to more closely coordinate
production with customer requirements.
Unocal is a leading global energy resource and project development
company, with year-end 1996 petroleum reserves of more than 9.8 trillion cubic
feet of natural gas equivalent (1.6 billion barrels of oil equivalent) and major
oil and gas production activities in Asia and the U.S. Gulf of Mexico. The
company is also active in energy resource development in Asia and Latin America
and is developing gas-marketing solutions for Turkmenistan. The company
maintains twin headquarters in California and Malaysia, with major offices in
Singapore, Jakarta, Bangkok and Sugar Land, Texas.
Forward-looking statements, including estimates of financial results
and production activities, in this news release are based on assumptions
concerning production, market conditions, competition, and other considerations.
Actual results could differ materially.
News releases and other information about Unocal are available at the
company's Internet website, www.unocal.com.
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Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
UNOCAL CORPORATION
(Registrant)
Date: November 26, 1997 By: /s/ JOSEPH A. HOUSEHOLDER
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Joseph A. Householder
Vice President, Tax and Comptroller
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