<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 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): April 28, 1995
UNION TEXAS PETROLEUM HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
Delaware 1-9019 76-0040040
(State or other (Commission (IRS Employer
jurisdiction File Number) Identification No.)
of incorporation)
1330 Post Oak Boulevard, Houston, Texas 77056
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (713) 623-6544
<PAGE> 2
Item 5. Other Events.
Financing Activities. During 1994, the Company replaced its $650
million unsecured revolving credit facility with three unsecured credit
facilities (the "Credit Facilities"). One of the Credit Facilities was a $100
million unsecured credit agreement with NationsBank of Texas, N.A.
("NationsBank"), as agent, Bank of America National Trust and Savings
Association ("Bank of America") and Union Bank of Switzerland, Houston Agency
("UBS"), as co-agents. This Credit Facility was terminated by the Company
effective March 31, 1995 as a result of the recent issuance of new senior
notes. Another Credit Facility was a $200 million revolver with NationsBank, as
agent, Bank of America and UBS, as co-agents, and certain other banks. This
Credit Facility was terminated effective April 23, 1995 and was replaced April
24, 1995 with a new $100 million revolver that provides for conversion of
amounts outstanding on April 15, 1996 to a one year term loan maturing April
15, 1997. The Company's remaining Credit Facility is with NationsBank, as
agent, Bank of America and UBS, as co-agents, and certain other banks.
Initially this Credit Facility was a $350 million revolver that reduced
quarterly by $25 million beginning July 31, 1997 and had a final maturity of
April 30, 1998. On April 24, 1995, this Credit Facility was amended to increase
the amount of the facility to $450 million, and to provide that the amount of
the facility would reduce quarterly by $35 million beginning July 31, 1998,
with a final maturity of April 30, 1999. In addition, the restriction on total
indebtedness discussed below was increased from $750 million to $775 million,
and the availability of competitive bid loans discussed below was increased
from $200 million to $300 million. Loans under the $450 million revolver may be
made in both pounds sterling and U.S. dollars at the option of the Company.
Loans under the Credit Facilities bear interest at floating market rates based
on, at the Company's option, the agent bank's base rate or LIBOR, plus
applicable margins, subject to increase in certain events. In addition, the
$450 million revolver allows the Company to obtain up to $300 million of
availability thereunder in U.S. dollar loans that bear interest at a rate
determined in a competitive bid process. Borrowings under the Credit Facilities
are guaranteed by certain subsidiaries of the Company that also guarantee the
Company's 8.25% senior notes due 1999, 8 3/8% senior notes due 2005 and 8 1/2%
senior notes due 2007 for an aggregate principal amount of $300 million
(collectively, the "Senior Notes"). The Credit Facilities contain restrictive
covenants, including limitations on incurrence of additional indebtedness,
asset sales and mergers or consolidations. The Credit Facilities restrict the
amount of total indebtedness incurred by the Company and the restricted
subsidiaries referred to in the Credit Facilities, which include the guarantors
and certain other subsidiaries, to $775 million of senior indebtedness
(including the Senior Notes and amounts drawn under the Credit Facilities) and
$100 million of subordinated indebtedness. Debt of unrestricted subsidiaries
and nonrecourse debt on certain assets of the Company and its subsidiaries are
not limited under the Credit Facilities, subject to certain conditions. The sum
of the Senior Notes and the commitments under the Credit Facilities equal $850
million. As a result, the Company is currently unable to fully utilize the
commitments under the Credit Facilities. However, the Company is pursuing an
amendment to the restriction on total indebtedness under the Credit Facilities.
The covenants also require maintenance of a certain level of stockholders'
equity. Under the terms of the Credit Facilities, the Company may pay dividends
and make stock repurchases, provided that such level of minimum stockholders'
<PAGE> 3
equity is maintained and the Company complies with the other covenants in the
Credit Facilities. Based on current conditions, the Company expects to pay
dividends without restriction under the Credit Facilities. At March 31, 1995,
$207 million was outstanding under the Credit Facilities bearing interest at a
weighted average rate of 6.8% per annum, and approximately $250 million was
available for additional borrowings under such existing Credit Facilities.
Tunisia. The Garaet el Hallab #1 exploratory well was spudded in
March 1995. The well, located onshore in south eastern Tunisia on the Jeffara
permit, has recently been plugged and abandoned. Union Texas Maghreb, Inc.
serves as operator and has a 65% working interest.
Press Releases. The information set forth in the three press releases
of the registrant dated April 21, 1995, April 21, 1995 and April 28, 1995,
which are filed as exhibits hereto, are incorporated herein by reference.
Item 7. Financial Statements and Exhibits.
(c) Exhibits:
<TABLE>
<CAPTION>
Exhibit
Number Description
- ------- -----------
<S> <C>
15 Independent Accountants' Awareness Letter
99.1 Press release dated April 21, 1995
99.2 Press release dated April 21, 1995
99.3 Press release dated April 28, 1995
</TABLE>
<PAGE> 4
Signature
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.
UNION TEXAS PETROLEUM
HOLDINGS, INC.
By: /s/ NEWTON W. WILSON, III
Newton W. Wilson, III
General Counsel, Vice President-
Administration and Secretary
Date: April 28, 1995
<PAGE> 5
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit
Number Description
- ------ -----------
<S> <C>
15 Independent Accountants' Awareness Letter
99.1 Press release dated April 21, 1995
99.2 Press release dated April 21, 1995
99.3 Press release dated April 28, 1995
</TABLE>
<PAGE> 1
EXHIBIT 15
INDEPENDENT ACCOUNTANTS' AWARENESS LETTER
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Dear Sirs:
We are aware that Union Texas Petroleum Holdings, Inc. has incorporated by
reference our report dated April 20, 1995 (issued pursuant to the provisions of
Statement on Auditing Standards No. 71) in the prospectus constituting part of
its Registration Statement on Form S-3 (No. 33-58735). We are also aware of our
responsibilities under the Securities Act of 1933.
Yours very truly,
Price Waterhouse LLP
Houston, Texas
April 25, 1995
<PAGE> 1
EXHIBIT 99.1
NEWS RELEASE
________________________________________________________________________________
[UNION TEXAS PETROLEUM LOGO] 1330 Post Oak Boulevard
P.O. Box 2120
Houston, Texas 77252-2120
(713) 623-6544
Contact: Carol L. Cox
(713) 968-2714
UNION TEXAS PETROLEUM FILES SECONDARY OFFERING
FOR KKR PARTNERSHIPS TO OFFER 10 MILLION
OF THEIR 33 MILLION SHARES IN UNION TEXAS
Houston, April 21, 1995 -- Union Texas Petroleum Holdings, Inc.
(NYSE:UTH) announced today the filing of a registration statement with the
Securities and Exchange Commission under which partnerships affiliated with
Kohlberg Kravis Roberts & Co. (KKR) will offer 10 million shares of their 33.3
million shares of Union Texas' common stock. As of March 31, 1995, Union Texas
had approximately 87.7 million shares of common stock outstanding.
The offering will be managed by Salomon Brothers Inc (books), CS First
Boston, Goldman, Sachs & Co. and Merrill Lynch & Co. In a secondary public
offering, 10 million shares are expected to be offered concurrently in the
United States and internationally. All shares will be sold by the KKR
partnerships. The KKR partnerships have granted the underwriters an option to
purchase up to an additional 1.5 million shares to cover over-allotments, if
any. Union Texas will not receive any proceeds from the offering.
Copies of the prospectus relating to the secondary offering may be
obtained from Salomon Brothers Inc, 7 World Trade Center, New York, New York
10048, (212) 783-7000.
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A registration statement relating to the offering has been filed with
the Securities and Exchange Commission but has not yet become effective. These
securities may not be sold nor may offers to buy be accepted prior to the time
the registration statement becomes effective. This press release shall not
constitute an offer to sell or the solicitation of an offer to buy nor shall
there be any sale of these securities in any state in which such offer,
solicitation or sale would be unlawful prior to registration or qualification
under the securities laws of any such state.
One of the largest independent producers located in the U.S.,
Houston-based Union Texas Petroleum explores for and produces oil and gas
overseas primarily in the U.K. North Sea, Indonesia and other strategic areas.
The company has petrochemical operations in Louisiana.
# # #
<PAGE> 1
EXHIBIT 99.2
NEWS RELEASE
________________________________________________________________________________
[UNION TEXAS PETROLEUM LOGO] 1330 Post Oak Boulevard
P.O. Box 2120
Houston, Texas 77252-2120
(713) 623-6544
Contact: Carol L. Cox
(713) 968-2714
UNION TEXAS PETROLEUM REPORTS SIGNIFICANTLY HIGHER
FIRST QUARTER EARNINGS
IMPROVED OIL AND LNG PRICES, INCREASED ETHYLENE MARGINS
CONTRIBUTE TO HIGHER INCOME
Houston, April 21, 1995 -- Union Texas Petroleum Holdings, Inc. today
reported 1995 first quarter earnings of 53 cents per share, up from 30 cents
per share in 1994's corresponding period. Net income for 1995's first three
months was $47 million, compared to $27 million in the same period a year ago.
"Union Texas posted a very strong first quarter," said Chairman and CEO
Clark Johnson. "Our 1995 first quarter results benefited from improved prices
for crude oil and liquefied natural gas (LNG) as well as a significant increase
in ethylene margins.
"In the U.K. North Sea, we experienced a 24% increase in our crude oil
prices for the first three months of 1995. During the first quarter of 1995,
our average sales price for U.K. North Sea oil was $16.34 per barrel, compared
to $13.13 per barrel a year ago.
"In Indonesia, we saw a 13% improvement during the first three months
of 1995 in our average LNG sales prices, which are set monthly based on a
'basket' of world oil prices. LNG prices averaged $3.07 per thousand cubic
feet in 1995's first quarter, versus $2.72 per thousand cubic feet a year ago.
The price increase was offset by a 14% decline in LNG sales volumes in the
first quarter of 1995
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<PAGE> 2
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compared to the same period in 1994 due to the contracted cargo mix," Johnson
said.
"During the first quarter of 1995, our ethylene margins averaged
approximately 16 cents per pound of ethylene, compared to 1 cent per pound a
year ago. Ethylene sales volumes rose to 120 million pounds of ethylene in the
first quarter of 1995."
Union Texas also noted that its average worldwide sales price for
natural gas was $2.75 per thousand cubic feet in the first three months of
1995, compared to $2.46 per thousand cubic feet in 1994's same period. All of
Union Texas' oil and gas producing operations are located overseas, where about
90% of the company's oil and gas revenues are indexed to world crude oil
prices.
Sales and operating revenues for 1995's first quarter totaled $240
million, up from $194 million a year ago, reflecting increased prices for crude
oil, LNG and ethylene.
One of the largest independent producers located in the U.S.,
Houston-based Union Texas Petroleum Holdings, Inc. (NYSE: UTH) explores for and
produces oil and gas overseas primarily in the U.K. North Sea, Indonesia and
other strategic areas. The company has petrochemical operations in Louisiana.
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- 3 -
Comparative financial highlights follow (amounts in millions, except
per share data):
<TABLE>
<CAPTION>
THREE MONTHS
ENDED MARCH 31,
--------------------
1995 1994
---- ----
<S> <C> <C>
Net income.............................. $ 47 $ 27
Earnings per share...................... $ .53 $ .30
Sales and operating revenues............ $ 240 $ 194
Average common shares outstanding....... 87.6 87.7
</TABLE>
See footnotes on page 6.
Additional financial and operating information appears on the attached pages.
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UNION TEXAS PETROLEUM
FINANCIAL SUMMARY
(amounts in millions, except per share data)
<TABLE>
<CAPTION>
FIRST QUARTER
---------------------
1995 1994
------ ------
<S> <C> <C>
Sales and operating revenues $ 240 $ 194
Net income $ 47 $ 27
Major operations(a)
Indonesia $ 28 $ 29
U.K. North Sea $ 18 $ 15
Pakistan $ 4 $ 3
Petrochemicals $ 12 --
Earnings per share of
common stock $ .53 $ .30
Discretionary cash flow(b) $ 112 $ 90
Major operations(a)
Indonesia $ 44 $ 46
U.K. North Sea $ 51 $ 46
Pakistan $ 8 $ 7
Petrochemicals $ 19 $ 2
Average common shares 87.6 87.7
</TABLE>
See footnotes on page 6.
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UNION TEXAS PETROLEUM
DISCRETIONARY CASH FLOW SUMMARY (b)
(amounts in millions)
<TABLE>
<CAPTION>
FIRST QUARTER
----------------------------
1995 1994
------ ------
<S> <C> <C>
Net income $ 47 $ 27
Less: Equity partnership
income $ (5) $ (7)
Add: DD&A $ 47 $ 47
Deferred taxes $ (2) $ (1)
Exploration expenses $ 15 $ 13
Unimar equity DCF (c) $ 10 $ 11
Discretionary cash flow $ 112 $ 90
</TABLE>
See footnotes on page 6.
OPERATING SUMMARY (d)
<TABLE>
<CAPTION>
FIRST QUARTER
--------------------------
1995 1994
------ ------
<S> <C> <C>
Net crude oil sales (MBBLS/D)
U.K. North Sea 37 35
Indonesia 6 7
Pakistan 5 4
Average crude oil prices (per BBL)
U.K. North Sea $16.34 $13.13
Indonesia $17.28 $14.72
Pakistan $14.62 $12.77
Net natural gas sales (MMCF/D)
Indonesian LNG 242 280
U.K. North Sea 44 41
Pakistan 43 46
Average natural gas prices (per MCF)
Indonesian LNG $ 3.07 $ 2.72
U.K. North Sea (e) $ 3.01 $ 2.88
Pakistan $ 1.30 $ 1.11
Ethylene (per LB)
Sales price $ .28 $ .15
Margins $ .16 $ .01
Sales volumes (MLBS/D)(f) 1,338 904
</TABLE>
See footnotes on page 6.
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<PAGE> 6
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FOOTNOTES
(a) Excludes corporate items and other worldwide ventures.
(b) Discretionary cash flow (DCF) is net income (less equity partnership
income) excluding depreciation, deferred taxes, and exploration expenses,
plus the company's estimated share of discretionary cash flow from its
equity interest in its Unimar partnership's Indonesian operations.
(c) Unimar equity DCF reflects the company's estimated share of discretionary
cash flow from its equity interest in its Unimar partnership's
Indonesian operations.
(d) Excludes the Unimar equity partnership.
(e) Excludes capacity charge of $17 million and $16 million in the first
quarters of 1995 and 1994, respectively, from the North and South Sean gas
fields in the U.K. North Sea.
(f) Represents Union Texas' 41.67% net interest in the jointly-owned Geismar
ethylene plant in Louisiana.
# # #
<PAGE> 1
EXHIBIT 99.3
NEWS RELEASE
________________________________________________________________________________
[UNION TEXAS PETROLEUM LOGO]
1330 Post Oak Boulevard
P. O. Box 2120
Houston, Texas 77252-2120
(713) 623-6544
Contact: Carol L. Cox
(713) 968-2714
UNION TEXAS PETROLEUM AND PARTNERS ANNOUNCE UPDATE OF
OFFSHORE ARGENTINA 1995 DRILLING PROGRAM
Houston, April 28, 1995 -- Union Texas (Argentina) Ltd., a subsidiary
of Union Texas Petroleum Holdings, Inc., and its partners YPF Sociedad Anonima
and Perez Companc today announced the results of the first of two exploration
wells planned to be drilled offshore Argentina in 1995. Union Texas, as
operator, said the Corona Austral No. 1 well was unsuccessful and has been
plugged and abandoned. Located on the 4.4 million-acre Cuenca Colorado Marina-1
block in the South Atlantic Ocean, the well reached a total depth of 12,218
feet (3,725 meters). The objective interval which was found in the venture's
1994 Cruz del Sur exploration well was absent in the Corona Austral well. No
flow tests were conducted on the Corona Austral well.
Union Texas said the drilling rig currently is preparing to drill the
venture's second 1995 exploration well, the Estrella No. 1. The second well is
located approximately 56 miles (90 kilometers) west-northwest of the Corona
Austral well. The Estrella well is expected to be drilled to approximately
13,775 feet (4,200 meters).
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<PAGE> 2
In mid-1994, Union Texas and its partners drilled the initial
exploration well on the Cuenca Colorado Marina-1 block. The Cruz del Sur No.
X-1 well, which is located about 6 miles southwest of the Corona Austral well,
was drilled to a depth of 14,069 feet (4,288 meters). The Cruz del Sur well did
not find commercial quantities of crude oil, but encountered hydrocarbon shows
over a gross interval of 2,460 feet (750 meters). Reservoir formation tests
yielded 39 degree API gravity oil.
The block is situated about 155 miles offshore in the South Atlantic
Ocean, about 310 miles south of Buenos Aires. Water depths range from 300 to
3,000 feet with most prospects within 600 feet. Union Texas has a 50% working
interest in the block. YPF, the former Argentine national oil company, has a
35% working interest in the block, with Perez Companc, a large Argentine
company with diversified interests, holding the remaining 15% working interest.
One of the largest independent producers located in the U.S.,
Houston-based Union Texas Petroleum Holdings, Inc. (NYSE: UTH) explores for and
produces oil and gas overseas primarily in the U.K. North Sea, Indonesia and
other strategic areas. The company has petrochemical operations in Louisiana.
# # #
