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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
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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):
June 17, 1997
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TEXACO INC.
(Exact name of registrant as specified in its charter)
Delaware 1-27 74-1383447
(State or other jurisdiction of (Commission File (I.R.S. Employer
incorporation) Number) Identification Number)
2000 Westchester Avenue, 10650
White Plains, New York (Zip Code)
(Address of principal executive offices)
(914) 253-4000
(Registrant's telephone number, including area code)
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Item 5. Other Events
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1. On June 17, 1997, the Registrant's 50 percent owned affiliate, Caltex
Petroleum Corporation ("Caltex"), announced that it has received a
claim from the U. S. Internal Revenue Service ("IRS") for $292 million
in excise taxes, plus interest and penalties.
The IRS claim relates to crude oil sales to Japanese customers
beginning in 1980. Prior to 1980, Caltex directly supplied crude oil to
its Japanese customers. In 1980, a Caltex subsidiary, Caltex Trading
and Transport Corporation, also became a contractual supplier of crude
oil to the Japanese customers. The IRS position is that this was a
transfer of property, and thus taxable.
Caltex announced that it will challenge the claim and fully expects to
prevail, since the addition of another supplying company was not a
taxable event. Additionally, Caltex believes the claim is based on an
overstated value. Finally, Caltex disagrees with the imposition and
calculation of interest and penalties. Just as Caltex believes the
underlying excise tax claim is wrong, Caltex also believes the related
claim for approximately $140 million in penalties is equally wrong and
the IRS claim for almost $1.6 billion in interest charges is flawed.
Caltex believes that the likelihood that it will pay these charges is
remote.
The Registrant believes that this claim is entirely without merit and
is not anticipated to be materially important in relation to its
consolidated financial position or results of operations.
Caltex is a joint venture corporation owned 50 percent each by
subsidiaries of the Registrant and Chevron Corporation. Through its
subsidiaries and affiliates, Caltex refines and markets petroleum
products in more than 60 countries in the Asia-Pacific region, Africa
and the Middle East.
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SIGNATURES
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 hereunto duly authorized.
TEXACO INC.
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(Registrant)
By: R. E. KOCH
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(Assistant Secretary)
Date: June 19, 1997
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