Kenneth Dillon
Senior Vice President and President, International Oil and Gas Operations at OXY
Executive
About Kenneth Dillon
Kenneth Dillon is Senior Vice President of Occidental (OXY) and President of International Oil & Gas Operations, overseeing operations across the Middle East, North Africa, South America, the Gulf of Mexico/Gulf of America, Major Projects and Supply Chain; he joined Occidental more than 35 years ago and was appointed Senior Vice President in 2016 . OXY’s performance-aligned incentive design for executives centers on CROCE (Cash Return on Capital Employed) and TSR PSUs, plus RSUs and, in certain years, stock options; ACI (annual cash incentive) incorporates company metrics including sustainability, which is weighted at 30% of the company performance portion . Recent execution highlights under Dillon include Al Hosn expansion ahead of schedule with record HSE, Algeria Plan of Development approval, Oman record production, Gulf subsea pump commissioning, STRATOS milestones, a CO2 EOR pilot in Oman North, and AI efficiency initiatives .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Occidental Oil and Gas Corporation (subsidiary of OXY) | Senior Vice President; President, International Oil & Gas Operations | 2016–present | Led Al Hosn expansion ahead of schedule, record Abu Dhabi output/HSE, Algeria Plan of Development approval, Oman record production, Gulf of Mexico subsea pump commissioning, STRATOS milestones; established Gulf of America waterflood; launched AI efficiency projects; supported OLCV major projects at scale . |
Fixed Compensation
| Metric | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|
| Base Salary (effective rate) | $675,000 | $710,000 (eff. Feb 21, 2022) | $760,000 (eff. Feb 20, 2023) | $795,000 (eff. Feb 19, 2024) |
| ACI Target ($) | $800,000 | $825,000 | $825,000 | $825,000 |
| ACI Payout (% of target) | 160% | 170% | 150% | 135% |
| Actual ACI Paid ($) (Non-Equity Incentive in SCT) | $1,280,000 | $1,303,500 | $1,237,500 | $1,113,800 |
| Nonqualified Deferred Compensation Earnings ($) | — | $59,048 | $101,562 | $120,068 |
| All Other Compensation ($) | $169,936 | $295,601 | $315,989 | $305,123 |
Performance Compensation
ACI (Annual Cash Incentive) Design and Outcomes
| Attribute | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|
| Target ($) | $800,000 | $825,000 | $825,000 | $825,000 |
| Key Metrics | Company/individual metrics (company portion earned at 160%) | Company/individual metrics (company portion 170%) | Company metrics incl. sustainability (30% of company portion); ACI payout 150% | Company metrics incl. sustainability (30% of company portion); ACI payout 135% |
| Payout (% of Target) | 160% | 170% | 150% | 135% |
| Actual Paid ($) | $1,280,000 | $1,303,500 | $1,237,500 | $1,113,800 |
LTI (Long-Term Incentives) Structure and Key Grant Terms
| LTI Element | 2021 | 2022 |
|---|---|---|
| CROCE (PSUs) | Target 29,047 PSUs; payout 25–200% based on CROCE over 3 yrs | Target 20,359 PSUs; payout 25–200% based on CROCE over 3 yrs |
| TSR (PSUs) | Target 20,066 PSUs; payout 25–200% based on relative TSR; capped at target if absolute TSR negative | Target 14,065 PSUs; same TSR mechanics |
| RSUs | 29,047 RSUs; vest ratably 1/3 on Feb 28, 2022/2023/2024; 2-year post-vest holding for net shares | 20,359 RSUs; standard RSU terms per program |
| NQSOs (Options) | 57,978 NQSOs; exercise price $25.39; vest ratably over 3 yrs (Feb 28, 2022/2023/2024) | 37,410 NQSOs; exercise price $42.98; vest per program schedule |
| 2023 LTI Target Value | — | $3,500,000 target value; components CROCE, RSU, TSR |
| 2024 LTI Target Value | — | $3,600,000 target value; performance-based allocation maintained; components CROCE, RSU, TSR |
Equity Ownership & Alignment
| Metric | 2021 (as of Mar 11, 2022) | 2023 (as of Mar 10, 2023) | 2024 (as of Mar 8, 2024) | 2025 (as of Mar 10, 2025) |
|---|---|---|---|---|
| Common Stock | 134,131 | 182,344 | 254,599 | 308,592 |
| Options Exercisable within 60 Days | 179,686 | 291,661 | 323,457 | 335,927 |
| Warrants Exercisable within 60 Days | 14,343 | 16,962 | 16,962 | 16,962 |
| Total Beneficially Owned | 328,160 | 490,967 | 595,018 | 661,481 |
| % of Shares Outstanding | Less than 1% | Less than 1% | Less than 1% | Less than 1% |
- Stock ownership guidelines: Senior Vice Presidents must hold stock equal to 3× base salary; officers not meeting guidelines may not sell shares until compliant; unvested PSUs/options do not count; expected compliance within five years and RSU net shares have a two-year holding period .
- Anti-hedging: Executives are prohibited from hedging or engaging in derivative transactions designed to offset Occidental equity exposure .
- Ownership trend: Dillon’s reported total beneficial ownership increased from ~328K (2021) to ~661K (2025) shares-equivalents .
Employment Terms
| Provision | Terms |
|---|---|
| Golden Parachute policy | No grants exceeding 2.99× salary + ACI without shareholder approval . |
| Change-in-Control (CIC) Severance Plan | Double-trigger equity vesting; cash severance of 2.00× (CEO 2.99×) base salary + target bonus; pro-rata bonus; 2 years welfare benefits; outplacement up to 9 months . |
| Clawback | Compensation Committee may claw back ACI and LTI awards for misconduct; policy aligned with SEC Rule 10D-1/NYSE Listing Standard 303A.14 . |
| Retirement eligibility | As of Dec 31, 2023, Dillon qualifies for “Eligible Retirement” under OXY’s Retirement Policy; retirement treatment affects vesting (e.g., full vesting for RSUs; performance awards vest subject to actual performance) . |
| Non-CIC involuntary termination (illustrative amounts as of Dec 30, 2022) | Cash severance $2,302,500; pro-rata bonus $825,000; plus specified treatment of outstanding equity and limited benefits/outplacement . |
Performance Compensation – Detailed Metrics Table
| Metric | Weighting | Target (Illustrative) | Actual/Payout | Vesting/Settlement |
|---|---|---|---|---|
| ACI (cash) | Company metrics include sustainability (30% of company portion) | $800k (2021), $825k (2022–2024) | 160% (2021), 170% (2022), 150% (2023), 135% (2024) | Annual cash payout based on Committee assessment/program metrics |
| CROCE (PSUs) | Performance-based LTI | 29,047 target PSUs (2021); 20,359 (2022) | 25–200% of target based on CROCE over 3 years | Pays in shares at performance certification; CIC and retirement treatments per plan |
| TSR (PSUs) | Performance-based LTI | 20,066 target PSUs (2021); 14,065 (2022) | 25–200% of target based on relative TSR; capped at target if absolute TSR negative | Pays in shares at performance certification; CIC and retirement treatments per plan |
| RSUs | Time-based LTI | 29,047 (2021); 20,359 (2022) | N/A (time-based) | Vest 1/3 annually (Feb 28 for 2021 grants) with 2-year holding on net shares |
| NQSOs | Time-based LTI | 57,978 (2021); 37,410 (2022) | N/A (time-based) | 2021 strike $25.39; 2022 strike $42.98; vest ratably over 3 years |
Investment Implications
- Pay-for-performance alignment remains strong: high proportion of equity with performance PSUs (CROCE, TSR) and double-trigger vesting; ACI includes sustainability metrics (30% of company portion) and has trended down from 170% (2022) to 135% (2024), indicating tighter calibration to outcomes .
- Ownership/skin-in-the-game: Dillon’s beneficial ownership has steadily increased (328K→661K) while OXY enforces 3× salary stock ownership for SVPs and prohibits hedging; RSU holding period further restricts immediate monetization, dampening near-term selling pressure .
- Vesting/sale windows: Historically, RSU tranches vest around late February (e.g., Feb 28 for 2021 grants) and annual equity grants have occurred around March 1, which can concentrate insider activity windows; however, holding requirements and anti-hedging reduce near-term liquidity incentives .
- Retention risk vs optionality: Eligibility for retirement-related vesting as of 2023 increases optionality for tenured leaders (including Dillon) while preserving performance conditions on PSUs; CIC protections are standard (2.00× base+target bonus for executives, plus pro-rata bonus and benefits) with shareholder-friendly golden parachute cap at 2.99× .
Net view: Compensation structure and governance indicate high alignment and controlled risk-taking; increasing beneficial ownership plus performance-weighted LTI design support sustained execution incentives, with limited evidence of pledging or aggressive severance economics beyond market-standard CIC terms .