Blows at Hammer

In all his flamboyant career--as a pencil manufacturer in the Soviet Union in the 1920s, whisky dealer, art collector and oil magnate in the U.S.--Ar-mand Hammer has probably never had a worse week. First, the 77-year-old chairman of Occidental Petroleum Corp. pleaded guilty in a Washington court to a charge of making three il legal contributions to Richard Nixon's 1972 presidential campaign. Then Hammer's oil firm accused the Libyan government of holding 520 of its employees as hostages in a dispute that has turned Occidental's investment in Libya, once considered Hammer's master stroke, into a growing headache.

Hammer's personal problems stem from an anonymous $100,000 commitment he made to the Nixon campaign.

He gave $46,000 to the Committee for the Re-Election of the President just before a federal law barring such anonymous gifts went into effect in April 1972. In order to contribute the other $54,000 without revealing his identity, he used third parties as sham donors; Hammer also concedes that when he was questioned about the donations by the Senate Watergate committee, he lied. Having pleaded guilty, he faces fines of $3,000 and possibly three years in prison, though it is unlikely he will go to jail even for a year.

The dispute with Libya is a complex affair. In 1972 Libya nationalized 51% of Occidental's subsidiary there. Since then, Oxy complains, Libya has restricted production to the point that the company cannot fulfill its commitments to customers. Last month Occidental notified the Libyans that it was filing suit in international arbitration courts for $1 billion, claiming breach of contract; simultaneously, it refused to pay $440 million in royalties and taxes. The Libyans, according to Occidental, last week cut off crude deliveries altogether and refused to let 520 non-Libyan employees of the corporation, including 230 Americans, leave the country.

Occidental complained to the State Department, and a spokesman said the department is "looking into the matter urgently." At week's end Occidental announced that it will resume negotiations with the Libyans in New York this week--but there was no word whether the 520 employees would be released.

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