Texaco to Take About $350 Million in Charges

Texaco Inc., the third-largest U.S. oil company, will take fourth-quarter charges of about $350 million as it cuts its work force and lowers the value of inventory and property because of falling oil prices. White Plains, N.Y.-based Texaco also said that fourth-quarter earnings excluding gains and charges will be 13 cents to 16 cents a share. The company was expected to make 30 cents a share, based on the average estimate of analysts polled by First Call Corp. Texaco shares rose $1.25 to close at $55.63 on the NYSE. Texaco estimated charges of $95 million for severance payments, $170 million for drops in the value of its oil and fuel and $100 million because of declining prices for oil and natural gas still in the ground. It also will report a gain of as much as $20 million on asset sales. Texaco said late last year that it plans to cut at least 1,100 jobs, or about 5.5% of its staff. Oil prices dropped 23% in the last year.