UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549

                                    FORM 10-Q

              [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                  For the Quarterly Period Ended March 31, 2002

                                       OR

              [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                   For the Transition Period from       to
                                                 ------    ------

                         Commission File Number 1-16619


                             KERR-McGEE CORPORATION
             (Exact Name of Registrant as Specified in its Charter)



                   Delaware                      73-1612389
        (State or Other Jurisdiction of       (I.R.S. Employer
        Incorporation or Organization)       Identification No.)


                Kerr-McGee Center, Oklahoma City, Oklahoma 73125
              (Address of Principal Executive Offices and Zip Code)

        Registrant's telephone number, including area code (405) 270-1313


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.

                            Yes    X        No
                                  ---

Number of shares of common stock,  $1.00 par value,  outstanding as of March 31,
2002: 100,261,259.



                         PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.
<TABLE>

                 KERR-McGEE CORPORATION AND SUBSIDIARY COMPANIES
                        CONSOLIDATED STATEMENT OF INCOME
                                   (UNAUDITED)

<CAPTION>
                                                                       Three Months Ended
                                                                            March 31,
(Millions of dollars, except per-share amounts)                         2002            2001
                                                                      ------        --------

<S>                                                                   <C>           <C>
Sales                                                                 $809.4        $1,053.8
                                                                      ------        --------

Costs and Expenses
   Costs and operating expenses                                        360.4           306.4
   Selling, general and administrative expenses                         57.1            49.5
   Shipping and handling expenses                                       29.3            30.0
   Depreciation and depletion                                          205.1           163.4
   Asset impairment                                                        -            13.2
   Exploration, including dry holes and
      amortization of undeveloped leases                                31.9            49.8
   Taxes, other than income taxes                                       26.4            32.9
   Provision for environmental remediation and restoration,
      net of reimbursements                                              2.4             3.7
   Interest and debt expense                                            70.7            44.6
                                                                      ------        --------
         Total Costs and Expenses                                      783.3           693.5
                                                                      ------        --------

                                                                        26.1           360.3
Other Income (Expense)                                                 (23.8)          201.4
                                                                      ------        --------

Income before Income Taxes                                               2.3           561.7
Taxes on Income                                                         (1.4)         (208.7)
                                                                      ------        --------

Income from Continuing Operations                                         .9           353.0
Income from Discontinued Operations (net of income taxes
   of $1.3 and $1.1 in 2002 and 2001, respectively)                      4.6             2.0
Cumulative Effect of Change in Accounting Principle
   (net of benefit for income taxes of $10.8)                              -           (20.3)
                                                                      ------        --------

Net Income                                                            $  5.5        $  334.7
                                                                      ======        ========

Net Income per Common Share
   Basic -
     Continuing operations                                            $  .01        $   3.73
     Discontinued operations                                             .04             .02
     Cumulative effect of change in accounting principle                   -            (.21)
                                                                      ------        --------

              Total                                                   $  .05        $   3.54
                                                                      ======        ========
   Diluted -
     Continuing operations                                            $  .01        $   3.38
     Discontinued operations                                             .04             .02
     Cumulative effect of change in accounting principle                   -            (.19)
                                                                      ------        --------

              Total                                                   $  .05        $   3.21
                                                                      ======        ========

Dividends Declared per Common Share                                   $  .45        $    .45
                                                                      ======        ========

The accompanying notes are an integral part of this statement.
</TABLE>

<TABLE>

                 KERR-McGEE CORPORATION AND SUBSIDIARY COMPANIES
                           CONSOLIDATED BALANCE SHEET
                                   (UNAUDITED)
<CAPTION>

                                                                      March 31,      December 31,
(Millions of dollars)                                                      2002              2001
                                                                      ---------      ------------

<S>                                                                   <C>              <C>
ASSETS
Current Assets
   Cash                                                               $   128.3        $    91.3
   Accounts receivable                                                    546.7            477.6
   Inventories                                                            439.7            437.7
   Deposits, prepaid expenses and other assets                            116.5            351.1
                                                                      ---------        ---------
        Total Current Assets                                            1,231.2          1,357.7
                                                                      ---------        ---------

Property, Plant and Equipment                                          16,530.5         16,249.4
   Less reserves for depreciation, depletion and amortization           8,239.2          8,055.0
                                                                      ---------        ---------
                                                                        8,291.3          8,194.4
                                                                      ---------        ---------

Investments and Other Assets                                              890.1            786.2
Goodwill                                                                  355.6            355.6
Discontinued Operations Held for Sale                                     269.5            257.2
                                                                      ---------        ---------

        Total Assets                                                  $11,037.7        $10,951.1
                                                                      =========        =========

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
   Accounts payable                                                   $   641.8        $   653.3
   Short-term borrowings                                                    8.4              8.4
   Long-term debt due within one year                                       7.5             26.4
   Other current liabilities                                              486.7            483.5
                                                                      ---------        ---------
        Total Current Liabilities                                       1,144.4          1,171.6
                                                                      ---------        ---------

Long-Term Debt                                                          4,722.9          4,539.4
                                                                      ---------        ---------

Deferred Income Taxes                                                   1,249.5          1,272.7
Other Deferred Credits and Reserves                                       844.5            793.3
                                                                      ---------        ---------
                                                                        2,094.0          2,066.0
                                                                      ---------        ---------
Stockholders' Equity
   Common stock, par value $1 - 300,000,000 shares
      authorized, 100,269,442 shares issued at 3-31-02
      and 100,186,350 shares issued at 12-31-01                           100.3            100.2
   Capital in excess of par value                                       1,681.0          1,676.6
   Preferred stock purchase rights                                          1.0              1.0
   Retained earnings                                                    1,503.1          1,542.6
   Accumulated other comprehensive loss                                  (129.5)           (64.2)
   Common shares in treasury, at cost - 8,183 shares
      at 3-31-02 and 1,020 at 12-31-01                                      (.5)             (.1)
   Deferred compensation                                                  (79.0)           (82.0)
                                                                      ---------        ---------
        Total Stockholders' Equity                                      3,076.4          3,174.1
                                                                      ---------        ---------

        Total Liabilities and Stockholders' Equity                    $11,037.7        $10,951.1
                                                                      =========        =========

The "successful efforts" method of accounting for oil and gas exploration and
production activities has been followed in preparing this balance sheet.

The accompanying notes are an integral part of this statement.
</TABLE>

<TABLE>

                 KERR-McGEE CORPORATION AND SUBSIDIARY COMPANIES
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                                   (UNAUDITED)
<CAPTION>

                                                                        Three Months Ended
                                                                             March 31,
(Millions of dollars)                                                     2002           2001
                                                                      ---------       --------

Operating Activities
--------------------
<S>                                                                   <C>               <C>
Net income                                                            $     5.5         $ 334.7
Adjustments to reconcile net income to net cash
  provided by operating activities -
    Depreciation, depletion and amortization                              221.9           177.8
    Asset impairment                                                          -            13.2
    Dry hole costs                                                          2.7            20.3
    Deferred income taxes                                                 (27.8)           47.0
    Provision for environmental remediation and
      restoration, net of reimbursement                                     2.4             3.7
    Loss (gain) on sale and retirement of assets                            2.4            (1.1)
    Noncash items affecting net income                                     31.6          (162.1)
    Other net cash provided by operating activities                        34.8           109.5
                                                                      ---------         -------
      Net Cash Provided by Operating Activities                           273.5           543.0
                                                                      ---------         -------

Investing Activities
--------------------
Capital expenditures                                                     (344.2)         (371.8)
Dry hole expense                                                           (2.7)          (20.3)
Acquisitions                                                                  -           (23.8)
Other investing activities                                                 (8.5)           (5.7)
                                                                      ---------         -------
      Net Cash Used in Investing Activities                              (355.4)         (421.6)
                                                                      ---------         -------

Financing Activities
--------------------
Issuance of long-term debt                                              1,209.3            81.0
Repayment of long-term debt                                            (1,047.9)          (80.2)
Increase in short-term borrowings                                             -             1.8
Issuance of common stock                                                    1.6            11.1
Dividends paid                                                            (45.1)          (42.5)
                                                                      ---------         -------
      Net Cash Provided by (Used in) Financing Activities                 117.9           (28.8)
                                                                      ---------         -------

Effects of Exchange Rate Changes on Cash and Cash Equivalents               1.0             (.7)
                                                                      ---------         -------

Net Increase in Cash and Cash Equivalents                                  37.0            91.9

Cash and Cash Equivalents at Beginning of Period                           91.3           144.0
                                                                      ---------         -------

Cash and Cash Equivalents at End of Period                            $   128.3         $ 235.9
                                                                      =========         =======

The accompanying notes are an integral part of this statement.

</TABLE>



                 KERR-McGEE CORPORATION AND SUBSIDIARY COMPANIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                 MARCH 31, 2002


A.      The condensed financial  statements included  herein have  been prepared
        by the company,  without audit, pursuant to the rules and regulations of
        the  Securities  and  Exchange   Commission   and,  in  the  opinion  of
        management, include all adjustments, consisting only of normal recurring
        accruals,  necessary to present fairly the resulting  operations for the
        indicated periods. Certain information and footnote disclosures normally
        included in financial  statements prepared in accordance with accounting
        principles  generally  accepted in the United States have been condensed
        or omitted pursuant to such rules and regulations.  Although the company
        believes  that the  disclosures  are  adequate  to make the  information
        presented not misleading, it is suggested that these condensed financial
        statements be read in conjunction with the financial  statements and the
        notes  thereto  included in the  company's  latest annual report on Form
        10-K.

        On August 1, 2001,  the company  completed  the  acquisition  of all the
        outstanding shares of common stock of HS Resources, Inc., an independent
        oil and gas  exploration  and  production  company.  To  accomplish  the
        acquisition,  the company  organized  and formed a new holding  company,
        Kerr-McGee   Holdco,   which  later   changed  its  name  to  Kerr-McGee
        Corporation.  All  the  outstanding  shares  of  the  former  Kerr-McGee
        Corporation were cancelled,  and the same number of shares was issued by
        the new holding company.  The former Kerr-McGee  Corporation was renamed
        Kerr-McGee Operating Corporation and is now a wholly owned subsidiary of
        the holding company,  along with Kerr-McGee  Rocky Mountain  Corporation
        (formerly HS Resources).

B.      In  June  1998,  the  Financial  Accounting   Standards   Board   issued
        Statement No. 133,  "Accounting  for Derivative  Instruments and Hedging
        Activities" (FAS 133). The statement as amended  requires  recording all
        derivative instruments as assets or liabilities, measured at fair value.
        Kerr-McGee  adopted this  standard on January 1, 2001,  by recording the
        fair  value of all the  foreign  currency  forward  purchase  and  sales
        contracts, and by separating and recording the fair value of the options
        associated  with the  company's  debt  exchangeable  for  stock of Devon
        Energy Corporation  (Devon) presently owned by the company.  In adopting
        the standard,  the company  recognized a net expense of $20.3 million in
        the 2001 first quarter as a cumulative effect of the accounting  change.
        Also, in accordance with FAS 133, the company chose to reclassify 85% of
        the  Devon  shares  owned to  "trading"  from the  "available  for sale"
        category of  investments.  On January 1, 2001,  the  company  recognized
        after-tax income totaling $117.9 million for the unrealized appreciation
        on the Devon shares  reclassified  to trading.  The portion of the stock
        investment  now  classified  as  "trading" is  marked-to-market  through
        income each month.

        In March 2002,  the company  hedged a portion of its  production for the
        period April through December 2002 to increase the predictability of its
        cash flows and support  additional  capital  projects.  The hedges cover
        approximately  44% of the expected  remaining  2002 oil  production  and
        approximately  38% of expected  remaining 2002 domestic gas  production.
        These  positions have been designated and qualify as cash flow hedges of
        a portion of 2002 production.

        The  production  hedging  transactions  are in the form of  fixed  price
        swaps.  The hedges cover  30,000  barrels of oil per day of domestic oil
        production at an average  price of $24.09 per barrel and 60,000  barrels
        of oil per day of North Sea oil production at an average price of $23.17
        per barrel.  The company also entered into price swaps covering  250,000
        MMBtu per day of domestic  natural gas production at an average price of
        $3.10 per  MMBtu.  The price  swaps will be  settled  using the  closing
        prices on the New York  Mercantile  Exchange  (NYMEX) for domestic light
        sweet crude and natural gas, and the  International  Petroleum  Exchange
        (IPE) for Brent crude.

        The following table sets forth the company's outstanding oil and natural
        gas hedge  contracts  executed in 2002 and their fair value at March 31,
        2002.
<TABLE>
<CAPTION>

                                                                                        Domestic Natural Gas
                            North Sea Oil Hedging          Domestic Oil Hedging                Hedging
       (Millions of     --------------------------     -------------------------     -------------------------
        dollars)          Notional       Liability      Notional       Liability      Notional       Liability
                          Volumes          Fair          Volumes          Fair         Volumes          Fair
      2002                 (Bbls)          Value         (Bbls)          Value         (MMBtu)         Value
      -------------     ----------       ---------     ---------       ---------     ----------      ---------
      <S>                <C>                <C>          <C>              <C>         <C>              <C>
      April              1,800,000          $ (5.0)      900,000          $ (2.0)     7,500,000        $ (2.8)
      May                1,860,000            (5.1)      930,000            (2.1)     7,750,000          (1.4)
      June               1,800,000            (4.3)      900,000            (2.1)     7,500,000          (1.6)
      July               1,860,000            (4.0)      930,000            (2.1)     7,750,000          (1.9)
      August             1,860,000            (3.7)      930,000            (1.9)     7,750,000          (2.2)
      September          1,800,000            (3.2)      900,000            (1.6)     7,500,000          (2.2)
      October            1,860,000            (3.0)      930,000            (1.5)     7,750,000          (2.3)
      November           1,800,000            (2.6)      900,000            (1.2)     7,500,000          (4.1)
      December           1,860,000            (2.4)      930,000            (1.1)     7,750,000          (6.0)
                        ----------        --------     ---------       ---------     ----------      --------

      Total             16,500,000          $(33.3)    8,250,000          $(15.6)    68,750,000        $(24.5)
                        ==========        ========     =========       =========     ==========      ========
</TABLE>

        The resulting  changes in fair value of these  contracts are recorded in
        accumulated other  comprehensive  loss. The amounts in accumulated other
        comprehensive  loss,  $73.3  million  loss at March  31,  2002,  will be
        recognized in earnings when the contracts are settled under the terms of
        the swap  agreements.  The  company  expects  to  reclassify  all of the
        existing net losses at March 31, 2002,  into earnings during the next 12
        months,  assuming  no  further  changes  in  fair  market  value  of the
        contracts.  A total of $.1 million loss was recognized in the 2002 first
        quarter related to hedge ineffectiveness.

        From time to time, the company enters into forward  contracts to buy and
        sell  foreign  currencies.  Certain  of these  contracts  (purchases  of
        Australian  dollars and British pound sterling) have been designated and
        have qualified as cash flow hedges of the company's  anticipated  future
        cash flow needs for a portion of its capital  expenditures and operating
        costs.  These forward  contracts  generally  have durations of less than
        three years. The resulting  changes in fair value of these contracts are
        recorded in accumulated other comprehensive loss. The $13.4 million loss
        in  accumulated  other  comprehensive  loss at March 31,  2002,  will be
        recognized in earnings in the periods during which the hedged forecasted
        transactions  affect earnings (i.e., when the forward contracts close in
        the case of a hedge of  operating  costs and when the hedged  assets are
        depreciated  in the case of a hedge  of  capital  expenditures).  In the
        first quarter of 2002, the company  reclassified $2 million of losses on
        forward contracts from accumulated other comprehensive loss to operating
        expenses in the income  statement.  Of the  existing net losses at March
        31, 2002,  approximately $6.9 million will be reclassified into earnings
        during the next 12 months,  assuming no further changes in fair value of
        the contracts. No hedges were discontinued during the first quarter, and
        since forward  exchange rates are used to measure the derivative  values
        and the forward contracts have not been closed early, no ineffectiveness
        was recognized.

        The company has entered  into other  forward  contracts  to sell foreign
        currencies,  which  will be  collected  as a  result  of  pigment  sales
        denominated in foreign currencies,  primarily European currencies. These
        contracts have not been designated as hedges even though they do protect
        the company from changes in foreign currency rate changes. Almost all of
        the  pigment  receivables  have  been  sold in an  asset  securitization
        program  at  their   equivalent  U.S.  dollar  value  at  the  date  the
        receivables were sold. However,  the company retains the risk of foreign
        currency  rate changes  between the date of sale and  collection  of the
        receivables.

        As discussed in the company's  2001 Form 10-K, the company is also party
        to other commodity  contracts that have not been accounted for as hedges
        and are  recorded  at their fair market  value on the balance  sheet and
        marked-to-market through income each month. The net fair market value of
        these commodity-related derivatives was $10.2 million asset at March 31,
        2002.  The net loss  associated  with these  derivatives  totaled  $24.9
        million in the first quarter of 2002.

        In  connection  with the  issuance of $350  million of 5.375%  notes due
        April 15, 2005, the company entered into an interest rate swap agreement
        in  April  2002.  The  terms of the  agreement  effectively  change  the
        interest the company will pay on the debt until  maturity from the fixed
        rate to a variable rate of LIBOR plus 87.5 basis points.

C.      In  June  2001,  the  Financial  Accounting   Standards   Board   issued
        Statement of Financial  Accounting  Standards  (FAS) No. 141,  "Business
        Combinations," and FAS 142, "Goodwill and Other Intangible  Assets." FAS
        141 requires all business combinations initiated after June 30, 2001, to
        be accounted for under the purchase method.  The company adopted FAS 141
        for its  acquisition  of HS  Resources.  The company  adopted FAS 142 on
        January 1, 2002,  for all goodwill  and other  intangible  assets.  This
        statement changes the accounting for goodwill and intangible assets that
        have  indefinite  useful  lives  from  an  amortization   method  to  an
        impairment  approach.  The  nonamortization  provisions of this standard
        were  immediately  applicable  for any goodwill  acquired after June 30,
        2001.  The  company  is  required  to  complete  the  first  step of the
        transitional  impairment test for goodwill within six months of adoption
        of FAS 142 and to complete the final step of the transitional impairment
        test  by the end of the  calendar  year.  The  company  anticipates  the
        results  of this  assessment  will not  have a  material  effect  on its
        financial position, results of operations or cash flows.

        The acquired  intangible  assets and goodwill of the company as of March
        31, 2002, were as follows:

                                                           Gross
                                                         Carrying    Accumulated
        (Millions of dollars)                              Amount   Amortization
                                                         --------   ------------

        Amortized intangible assets:
          Proprietary seismic library (10-year life)       $  2.0          $ .1
          Customer list (5-year life)                         1.0             -
          Patents (life of patent)                             .1             -
                                                           ------          ----
               Total                                       $  3.1          $ .1
                                                           ======          ====

                                                         Carrying
                                                           Amount
                                                         --------
        Unamortized intangible assets:
          Intellectual properties associated
               with pigment manufacturing processes         $52.1

          Goodwill                                         $355.6

        Amortization of purchased intangibles for each of the next five years is
        estimated to be $.4 million.

        There was no change in the carrying value of goodwill during the quarter
        ended in March 31, 2002.  Of the goodwill  recorded on the balance sheet
        of  the  company  at  March  31,  2002,  $348  million  relates  to  the
        exploration  and  production  segment,  and $7.6 million  relates to the
        chemical pigment segment.

        The  following  table  presents net income for each period  exclusive of
        amortization  expense  recognized in such periods related to intangibles
        and goodwill, which are no longer amortized.



                                                      Three Months Ended
                                                          March 31,
        (In millions, except per-share amounts)        2002         2001
                                                       ----       ------

        Reported net income                            $5.5       $334.7
        Add back intangible amortization,
          net of tax                                      -           .6
                                                       ----       ------
        Adjusted net income                            $5.5       $335.3
                                                       ====       ======

        Diluted earnings per share for the first quarter of 2001 would have been
        one cent per share  higher or $3.22 if the new standard had been applied
        in 2001.

D.      In August 2001, the Financial  Accounting  Standards  Board  issued  FAS
        144,  "Accounting for Impairment or Disposal of Long-Lived  Assets." FAS
        144  supersedes  FAS 121,  "Accounting  for the Impairment of Long-Lived
        Assets and for Long-Lived  Assets to be Disposed Of," and the portion of
        the  Accounting  Principles  Board  Opinion  No. 30 that  deals with the
        disposal of a business  segment.  The company  adopted the  statement on
        January 1, 2002.

        During the first quarter of 2002, the company approved a plan to dispose
        of its  exploration  and production  operations in Kazakhstan and of its
        interest in the Bayu-Undan project in the East Timor Sea. The results of
        these   operations   have  been  reported   separately  as  discontinued
        operations  in the company's  Consolidated  Statement of Income for both
        2002 and 2001.  Additionally,  the net assets of discontinued operations
        have been reclassified to one line on the Consolidated Balance Sheet. On
        May 3, 2002,  the  company  completed  the sale of its  interest  in the
        Bayu-Undan  project  for $132  million in cash.  The sale is expected to
        result in an  after-tax  gain of  approximately  $20 million and will be
        reported in the second  quarter of 2002. The net proceeds to be received
        by the company will be used to reduce outstanding debt.

        Revenues applicable to the discontinued  operations totaled $4.3 million
        and $3.7  million  for the three  months  ended March 31, 2002 and 2001,
        respectively.  Assets held for sale in the Consolidated Balance Sheet at
        March 31, 2002, include accounts  receivable and other current assets of
        $9.6 million;  net property,  plant and equipment of $143.2 million; and
        investments  and  other  assets  of  $116.7  million  related  to  these
        discontinued operations.


E.      Net  cash  provided  by operating  activities reflects cash payments for
        income taxes and interest as follows:

                                                          Three Months Ended
                                                               March 31,
        (Millions of dollars)                               2002        2001
                                                         -------       -----

        Income tax payments                              $  12.2       $84.3
        Less refunds received                             (159.8)       (5.7)
                                                         -------       -----
        Net income tax payments(refunds)                 $(147.6)      $78.6
                                                         =======       =====

        Interest payments                                $  86.0       $34.3
                                                         =======       =====


F.      The first-quarter 2002 comprehensive  loss  was $59.7 million,  compared
        with  comprehensive  income of $279.2  million in the  prior-year  first
        quarter and  comprehensive  loss of $49.5 million for the fourth quarter
        of 2001.

        The company has certain  investments that are considered to be available
        for sale.  These financial  instruments are carried in the  Consolidated
        Balance Sheet at fair value, which is based on quoted market prices. The
        company had no  securities  classified  as held to maturity at March 31,
        2002,  or December  31,  2001.  At March 31, 2002 and December 31, 2001,
        available-for-sale  securities  for which fair  value can be  determined
        were as follows:
<TABLE>
<CAPTION>
                                                March 31, 2002                       December 31, 2001
                                         --------------------------         ------------------------------
                                                            Gross                                 Gross
                                                         Unrealized                            Unrealized
                                          Fair             Holding            Fair                Holding
         (Millions of dollars)           Value    Cost      Gain             Value      Cost       Loss
                                         -----    ----   ----------          -----      ----   ----------

         <S>                             <C>     <C>         <C>             <C>       <C>         <C>
         Equity Securities               $73.3   $31.9       $13.4(1)        $58.7     $31.9       $(1.2)(1)
         U.S. government obligations -
           Maturing within one year        2.4     2.4           -             2.9       2.9           -
           Maturing between one year       1.6     1.6           -             1.7       1.7           -
            and four years
                                                             -----
                Total                                        $13.4                                 $(1.2)
                                                             =====                                 =====
</TABLE>

        (1) These amounts include $28 million of gross unrealized hedging losses
            on 15% of the exchangeable debt at the time of adoption of FAS 133.

G.      Investments in equity  affiliates  totaled  $100  million  at  March 31,
        2002,  and $101  million at December  31,  2001.  Equity  income  (loss)
        related  to  the   investments  is  included  in  Other  Income  in  the
        Consolidated  Statement of Income and totaled  $(11.1)  million and $1.6
        million   for  the  three   months   ended  March  31,  2002  and  2001,
        respectively.

H.      The following  table sets forth the  computation of  basic  and  diluted
        earnings per share (EPS) from continuing  operations for the three-month
        period ended March 31, 2002 and 2001.

<TABLE>
<CAPTION>

                                                                For the Three Months Ended March 31,
                                         ---------------------------------------------------------------------------------
                                                          2002                                        2001
                                         ------------------------------------         ------------------------------------
                                            Income                                      Income
                                             from                                        from
     (In millions, except                 Continuing                Per-Share         Continuing                 Per-Share
     per-share amounts)                   Operations     Shares       Income          Operations     Shares        Income
                                          ----------     ------     ---------          ----------    ------      ---------


     <S>                                         <C>      <C>            <C>              <C>          <C>           <C>
     Basic EPS                                   $.9      100.2          $.01             $353.0       94.7          $3.73
                                                                         ====                                        =====

     Effect of Dilutive Securities:
     5 1/4% convertible debentures                 -          -                              5.3        9.8
     7 1/2% convertible debentures                 -          -                              2.2        1.7
     Stock options                                 -         .2                                -         .3
                                                 ---      -----                           ------      -----
     Diluted EPS                                 $.9      100.4          $.01             $360.5      106.5          $3.38
                                                 ===      =====          ====             ======      =====          =====
</TABLE>

I.      In  December  2000,   the   company   began   an   accounts   receivable
        monetization  for its  pigment  business  through  the sale of  selected
        accounts  receivable  with a three-year,  credit-insurance-backed  asset
        securitization program. The company retained servicing  responsibilities
        and subordinated  interests and will receive a servicing fee of 1.07% of
        the receivables sold for the period of time outstanding, generally 60 to
        120 days. No recourse  obligations  were recorded  since the company has
        very  limited   obligations  for  any  recourse   actions  on  the  sold
        receivables.  The  collection of the  receivables  is insured,  and only
        receivables  that qualify for credit insurance can be sold. A portion of
        the insurance is reinsured by the company's captive  insurance  company.
        However,  the company also believes  that the risk of insurance  loss is
        very  low  since  its  bad  debt   experience  has   historically   been
        insignificant.  The  company  also  received  preference  stock  in  the
        special-purpose  entity  equal  to 3.5%  of the  receivables  sold.  The
        preference  stock is essentially a retained  deposit to provide  further
        credit enhancements, if needed, but otherwise recoverable by the company
        at the end of the program.

        The  company  sold  $134.2  million  and $152.8  million of its  pigment
        receivables   during   the  first   three   months  of  2002  and  2001,
        respectively.  The sale of the receivables  resulted in pretax losses of
        $1.1 million and $2.6 million during the first quarter of 2002 and 2001,
        respectively.  The losses were equal to the difference in the book value
        of the receivables  sold and the total of cash and the fair value of the
        deposit retained by the special-purpose  entity. The outstanding balance
        on  receivables  sold totaled $98.4 million at March 31, 2002, and $96.1
        million at December 31, 2001.

J.      On April 17, 2002, The United  Kingdom  government  announced  plans  to
        make  certain  changes  to their  existing  tax  laws.  Under one of the
        proposals,  companies will pay a  supplementary  corporate tax charge of
        10% on  profits  from  their  U. K. oil and gas  production.  This is in
        addition to the current 30%  corporate tax on these  profits.  The U. K.
        government is also proposing  accelerating  tax depreciation for capital
        investments in U. K. upstream activities. Finally, the U. K. Government,
        subject to  consultation,  intends to abolish  North Sea royalty.  It is
        anticipated  that royalty will not be abolished  until after 2002. It is
        estimated  that the effect of the tax change in 2002 will  increase  the
        company's  2002  international  provision  for deferred  income taxes by
        approximately $150 million to $160 million.

K.      In connection  with the acquisition of HS Resources, a  holding  company
        structure  was  implemented  (see  Note A. for a  discussion  of the new
        organization).

        On  October 3,  2001,  Kerr-McGee  Corporation  issued  $1.5  billion of
        long-term notes in a public offering.  The notes are general,  unsecured
        obligations  of the company and rank on parity with all of the company's
        other unsecured and unsubordinated  indebtedness.  Kerr-McGee  Operating
        Corporation and Kerr-McGee  Rocky Mountain  Corporation  have guaranteed
        the notes.  Additionally,  Kerr-McGee  Corporation  has  guaranteed  all
        indebtedness of its subsidiaries,  including the indebtedness assumed in
        the  purchase  of  HS  Resources.   As  a  result  of  these   guarantee
        arrangements,   the  company  is  now  required  to  present   condensed
        consolidating  financial  information.  Since  neither  the new  holding
        company nor any guarantee  arrangement  existed during the first quarter
        of  2001,  comparative   consolidating   financial  information  is  not
        presented.

        The following condensed consolidating financial information presents the
        balance sheet as of March 31, 2002, and the related statements of income
        and cash  flows for the three  months  ended  March  31,  2002,  for (a)
        Kerr-McGee   Corporation,   the  holding  company,   (b)  the  guarantor
        subsidiaries,  and (c) the non-guarantor  subsidiaries on a consolidated
        basis.

<TABLE>

                     Kerr-McGee Corporation and Subsidiaries
                   Condensed Consolidating Statement of Income
                       For the Three Months March 31, 2002

<CAPTION>

                                                Kerr-McGee        Guarantor        Non-Guarantor
  (Millions of dollars)                         Corporation      Subsidiaries       Subsidiaries      Eliminations     Consolidated
                                                -----------      ------------      -------------      ------------     ------------

<S>                                                   <C>               <C>               <C>             <C>                <C>
  Sales                                               $ (.1)            $76.5             $821.9          $(88.9)            $809.4
                                                -----------      ------------      -------------      ------------     ------------

  Costs and Expenses
    Costs and operating expenses                          -              27.7              421.9           (89.2)             360.4
    Selling, general and administrative                   -              14.0               43.1               -               57.1
      expenses
    Shipping and handling expenses                        -               3.0               26.3               -               29.3
    Depreciation and depletion                            -              32.2              172.9               -              205.1
    Exploration, including dry holes and
      amortization of undeveloped leases                  -               2.0               29.9               -               31.9
    Taxes, other than income taxes                       .1               6.0               20.3               -               26.4
    Provision for environmental remediation
      and restoration, net of reimbursements              -                 -                2.4               -                2.4
    Interest and debt expenses                         27.0              64.6               28.1           (49.0)              70.7
                                               ------------       -----------      -------------     -----------       ------------
        Total Costs and Expenses                       27.1             149.5              744.9          (138.2)             783.3

                                                      (27.2)            (73.0)              77.0            49.3               26.1
  Other Income (Loss)                                 (63.6)             90.5               15.8           (66.5)             (23.8)
                                               ------------       -----------      -------------     -----------       ------------
  Income (Loss) before Income Taxes                   (90.8)             17.5               92.8           (17.2)               2.3
  Taxes on Income                                      35.1              (6.1)             (36.5)            6.1               (1.4)
                                               ------------       -----------      -------------     -----------       ------------
  Income (Loss) from Continuing Operations            (55.7)             11.4               56.3           (11.1)                .9
  Income from Discontinued Operations,
       net of tax                                         -                 -                4.6               -                4.6
                                               ------------       -----------      -------------     -----------       ------------
  Net Income (Loss)                                  $(55.7)            $11.4              $60.9          $(11.1)             $ 5.5
                                               ============       ===========      =============     ===========       ============

</TABLE>
<TABLE>

                     Kerr-McGee Corporation and Subsidiaries
                      Condensed Consolidating Balance Sheet
                                 March 31, 2002

<CAPTION>

                                                  Kerr-McGee        Guarantor    Non-Guarantor
  (Millions of dollars)                          Corporation     Subsidiaries      Subsidiaries     Eliminations     Consolidated
                                              --------------    -------------    --------------     ------------     ------------

  <S>                                               <C>              <C>              <C>             <C>                <C>
  ASSETS
  Current Assets
    Cash                                            $      -         $    2.5         $   125.8       $        -         $  128.3
    Intercompany receivables                           930.1            112.0           1,145.8         (2,187.9)               -
    Accounts receivable                                    -             41.5             505.2                -            546.7
    Inventories                                            -              7.4             432.3                -            439.7
    Deposits, prepaid expenses and other
      assets                                               -             37.3              81.0             (1.8)           116.5
                                                    --------         --------         ---------       ----------         --------
      Total Current Assets                             930.1            200.7           2,290.1         (2,189.7)         1,231.2

  Property, Plant and Equipment, net                       -          2,048.5           6,242.8                -          8,291.3
  Investments and Other Assets                          11.7            745.3             213.9            (80.8)           890.1
  Goodwill                                                 -            348.0               7.6                -            355.6
  Discontinued Operations Held for Sale                    -                -             269.5                -            269.5
  Investments in and Advances to Subsidiaries        1,253.4          4,389.8           2,220.9         (7,864.1)               -
                                                    --------         --------         ---------       ----------        ---------
         Total Assets                               $2,195.2         $7,732.3         $11,244.8       $(10,134.6)       $11,037.7
                                                    ========         ========         =========       ==========        =========

  LIABILITIES AND STOCKHOLDERS' EQUITY
  Current Liabilities
    Accounts payable                                $   45.1         $   59.5         $   537.2       $        -        $   641.8
    Short-term borrowings                                  -               .2               8.2                -              8.4
    Intercompany borrowings                                -          1,356.2             833.7         (2,189.9)               -
    Long-term debt due within one year                     -              7.5                 -                -              7.5
    Other current liabilities                           42.8           (204.2)            649.9             (1.8)           486.7
                                                    --------         --------         ---------       ----------        ---------
       Total Current Liabilities                        87.9          1,219.2           2,029.0         (2,191.7)         1,144.4

  Long-Term Debt                                     1,497.1          2,016.5           1,209.3                -          4,722.9
  Deferred Credits and Reserves                            -          1,084.3           1,010.0              (.3)         2,094.0
  Intercompany Advances                                    -                -             873.1           (873.1)               -
  Stockholders' Equity                                 610.2          3,412.3           6,123.4         (7,069.5)         3,076.4
                                                    --------         --------         ---------       ----------        ---------
      Total Liabilities and Stockholders'
        Equity                                      $2,195.2         $7,732.3         $11,244.8       $(10,134.6)       $11,037.7
                                                    ========         ========         =========       ==========        =========
</TABLE>

<TABLE>


                     Kerr-McGee Corporation and Subsidiaries
                 Condensed Consolidating Statement of Cash Flows
                    For the Three Months Ended March 31, 2002

<CAPTION>

                                                 Kerr-McGee        Guarantor     Non-Guarantor
  (Millions of dollars)                         Corporation     Subsidiaries      Subsidiaries       Eliminations     Consolidated
                                                -----------     ------------     -------------       ------------     ------------

  <S>                                                <C>             <C>                <C>                <C>             <C>
  Operating Activities
  Net income (loss)                                  $(55.7)         $  11.4            $ 60.9             $(11.1)         $   5.5
  Adjustments to reconcile net income (loss)
    to net cash provided by operating
      activities -
       Depreciation, depletion and
         amortization                                     -             32.5             189.4                  -            221.9
       Asset impairment                                   -                -                 -                  -                -
       Equity in earnings of subsidiaries              49.4            (60.8)                -               11.4                -
       Dry hole costs                                     -                -               2.7                  -              2.7
       Deferred income taxes                              -              (.5)            (27.3)                 -            (27.8)
       Provision for environmental
         remediation                                      -                -               2.4                  -              2.4
         and restoration
       Loss (gain) on sale and retirement
         of assets                                        -              (.2)              2.6                  -              2.4
       Noncash items affecting income                    .1             11.6              19.9                  -             31.6
       Other net cash provided by (used in)
          operating activities                         49.6             44.5             (74.1)              14.8             34.8
                                                     ------          -------         ---------             ------          -------
             Net Cash Provided by Operating
               Activities                              43.4             38.5             176.5               15.1            273.5
                                                     ------          -------         ---------             ------          -------

  Investing Activities
  Capital expenditures                                    -            (39.0)           (305.2)                 -           (344.2)
  Dry hole expense                                        -                -              (2.7)                 -             (2.7)
  Other investing activities                              -              1.6             (11.6)               1.5             (8.5)
                                                     ------          -------         ---------             ------          -------
             Net Cash Used in Investing
               Activities                                 -            (37.4)           (319.5)               1.5           (355.4)
                                                     ------          -------         ---------             ------          -------

  Financing Activities
  Issuance of long-term debt                              -                -           1,209.3                  -          1,209.3
  Repayment of long-term debt                             -            (18.7)         (1,029.2)                 -         (1,047.9)
  Increase (decrease) in intercompany
    notes and advances                                    -             16.6                 -              (16.6)               -
  Issuance of common stock                              1.7                -               (.1)                 -              1.6
  Dividends paid                                      (45.1)               -                 -                  -            (45.1)
                                                     ------          -------         ---------             ------        ---------
             Net Cash Provided by (Used in)
                Financing Activities                  (43.4)            (2.1)            180.0              (16.6)           117.9
                                                     ------          -------         ---------             ------        ---------

  Effects of Exchange Rate Changes on Cash
     and Cash Equivalents                                 -                -               1.0                  -              1.0
                                                     ------          -------         ---------             ------        ---------
  Net Increase (Decrease) in Cash and Cash
     Equivalents                                          -             (1.0)             38.0                  -             37.0
  Cash and Cash Equivalents at Beginning of
     Period                                               -              3.5              87.8                  -             91.3
                                                     ------          -------         ---------             ------        ---------
  Cash and Cash Equivalents at End of Period          $   -          $   2.5         $   125.8             $    -        $   128.3
                                                     ======          =======         =========             ======        =========

</TABLE>

L.      CONTINGENCIES

        West Chicago, Illinois

        In 1973, a wholly owned subsidiary, Kerr-McGee Chemical Corporation, now
        Kerr-McGee Chemical LLC (Chemical), closed the facility in West Chicago,
        Illinois,   that  processed  thorium  ores.  Historical  operations  had
        resulted in low-level  radioactive  contamination at the facility and in
        the surrounding  areas. In 1979,  Chemical filed a plan with the Nuclear
        Regulatory  Commission (NRC) to decommission the facility.  In 1990, the
        NRC transferred  jurisdiction over the facility to the State of Illinois
        (the  State).  Following  is  the  current  status  of  various  matters
        associated with the closed facility.

        Closed Facility - In 1994, Chemical, the City of West Chicago (the City)
        and  the  State   reached   agreement  on  the  initial   phase  of  the
        decommissioning plan for the closed West Chicago facility,  and Chemical
        began shipping material from the site to a licensed  permanent  disposal
        facility.

        In February 1997,  Chemical executed an agreement with the City covering
        the  terms  and   conditions   for   completing   the  final   phase  of
        decommissioning  work. The State has indicated approval of the agreement
        and has issued license amendments authorizing much of the work. Chemical
        expects  most of the work to be  completed  within  the next two  years,
        leaving  principally only groundwater  remediation and/or monitoring for
        subsequent years.

        In 1992,  the State enacted  legislation  imposing an annual storage fee
        equal to $2 per cubic foot of byproduct  material  located at the closed
        facility,  which  cannot  exceed $26  million per year.  Initially,  all
        storage fee  payments  were  reimbursed  to Chemical as  decommissioning
        costs were incurred.  Chemical was fully reimbursed for all storage fees
        paid pursuant to this  legislation.  In June 1997, the  legislation  was
        amended to provide that future storage fee  obligations are to be offset
        against decommissioning costs incurred but not yet reimbursed.

        Vicinity  Areas - The U.S.  Environmental  Protection  Agency  (EPA) has
        listed four areas in the vicinity of the closed West Chicago facility on
        the National  Priority List  promulgated  by EPA under  authority of the
        Comprehensive Environmental Response, Compensation, and Liability Act of
        1980 (CERCLA) and has designated  Chemical as a potentially  responsible
        party in these  four  areas.  The EPA issued  unilateral  administrative
        orders  for  two of  the  areas  (known  as the  residential  areas  and
        Reed-Keppler Park), which require Chemical to conduct removal actions to
        excavate  contaminated  soils and ship the soils elsewhere for disposal.
        Without  waiving any of its rights or defenses,  Chemical is  conducting
        the work required by the two orders. Chemical has completed the required
        excavation and restoration  work at the park site and will be monitoring
        the site pending final EPA approval.  Work at the  residential  sites is
        expected to be completed in 2002.

        The other  two areas  (known  as the  Sewage  Treatment  Plant and Kress
        Creek)   currently   are  being  studied  to  determine  the  extent  of
        contamination,   and  Chemical  is  in  discussions  with  the  relevant
        authorities  regarding  cleanup  requirements.  Chemical has indicated a
        willingness  to  undertake  a cleanup of the final two sites  subject to
        various  conditions,   including  the  continued  reimbursement  of  the
        government's  share of costs for cleaning up the West Chicago sites.  If
        these  conditions  are met, the costs of cleanup for these two sites are
        not expected to exceed the  additional  federal  funding,  as more fully
        discussed below.

        Government  Reimbursement - Pursuant to Title X of the Energy Policy Act
        of 1992 (Title X), the U.S.  Department  of Energy (DOE) is obligated to
        reimburse  Chemical  for certain  decommissioning  and cleanup  costs in
        recognition  of the fact  that  much of the  facility's  production  was
        dedicated to United States government contracts.  Title X was amended in
        1998 to increase the amount authorized for reimbursement to $140 million
        plus inflation  adjustments.  Through March 31, 2002,  Chemical has been
        reimbursed   approximately   $146   million   under   Title   X.   These
        reimbursements are provided by congressional appropriations.

        Historically,  congressional  authorizations  under  Title X have lagged
        Chemical's  cleanup  expenditures.  At March 31, 2002, the  government's
        share of costs  already  incurred by Chemical but not yet  reimbursed by
        DOE totaled  approximately $95 million. In 2001, the United States House
        of  Representatives  passed a bill that  would  bring the  congressional
        authorizations  current  as  well  as  authorize  reimbursement  for the
        government's share of future costs. The bill currently is pending in the
        United States Senate.

        Other Matters

        The company and/or its subsidiaries are parties to a number of legal and
        administrative  proceedings involving environmental and/or other matters
        pending  in  various  courts  or  agencies.  These  include  proceedings
        associated with facilities  currently or previously  owned,  operated or
        used by the company,  its subsidiaries,  and/or their predecessors,  and
        include claims for personal injuries and property damages. The company's
        current and former  operations  also  involve  management  of  regulated
        materials and are subject to various environmental laws and regulations.
        These  laws  and  regulations  will  obligate  the  company  and/or  its
        subsidiaries  to clean up  various  sites at which  petroleum  and other
        hydrocarbons,  chemicals,  low-level radioactive substances and/or other
        materials  have been  disposed of or released.  Some of these sites have
        been  designated  Superfund  sites by EPA  pursuant  to CERCLA.  Similar
        environmental  regulations  exist in  foreign  countries  in  which  the
        company and/or its subsidiaries  operate.  Environmental  regulations in
        the North Sea are particularly stringent.

        The company provides for costs related to  contingencies  when a loss is
        probable and the amount is reasonably estimable.  It is not possible for
        the  company to  estimate  reliably  the amount and timing of all future
        expenditures  related  to  environmental  and  legal  matters  and other
        contingencies because:

           *  some sites are in the early  stages of  investigation,  and other
              sites may be identified in the future;

           *  cleanup  requirements  are  difficult  to  predict at sites  where
              remedial investigations have not been completed or final decisions
              have not been made regarding cleanup requirements, technologies or
              other factors that bear on cleanup costs;

           *  environmental  laws frequently  impose joint and several liability
              on all potentially responsible parties, and it can be difficult to
              determine the number and financial condition of other  potentially
              responsible parties and their share of responsibility  for cleanup
              costs;

           *  environmental laws and  regulations are continually changing,  and
              court proceedings are inherently uncertain; and

           *  some legal  matters are in  the early stages of  investigation  or
              proceeding  or  their  outcomes  otherwise  may  be  difficult  to
              predict, and other legal matters may be identified in the future.

        Although management  believes that it has established  adequate reserves
        for cleanup  costs and legal  matters,  due to these  uncertainties  the
        company could be required to record additional reserves in the future.

        As of March 31, 2002, the company had reserves totaling $161 million for
        cleaning  up  and  remediating   environmental  sites,   reflecting  the
        reasonably estimable costs for addressing these sites. This includes $44
        million  for the West  Chicago  sites.  Cumulative  expenditures  at all
        environmental   sites  through  March  31,  2002,  total  $953  million.
        Management  believes,  after  consultation  with general  counsel,  that
        currently  the  company  has  reserved  adequately  for  the  reasonably
        estimable costs of contingencies. However, additions to the reserves may
        be required as  additional  information  is  obtained  that  enables the
        company to better estimate its liabilities, including liability at sites
        now under review,  though the company  cannot now reliably  estimate the
        amount of future additions to the reserves.




M.      Following is a summary of sales and operating  profit for  each  of  the
        company's business segments for the first quarter 2002 and 2001.
<TABLE>
<CAPTION>

                                                                     Three Months Ended
                                                                            March 31,
        (Millions of dollars)                                      2002                     2001
                                                                -------                ---------

        <S>                                                     <C>                     <C>
        Sales
          Exploration and production                            $ 545.5                 $  758.5
          Chemicals - Pigment                                     216.5                    248.2
          Chemicals - Other                                        47.4                     47.1
                                                                -------                 --------
            Total Sales                                         $ 809.4                 $1,053.8
                                                                =======                 ========

        Operating Profit
          Exploration and production                            $ 124.4                 $  410.8
          Chemicals - Pigment                                     (11.5)                    36.4
          Chemicals - Other                                         3.6                    (23.1)
                                                                -------                 --------
              Total Operating Profit                              116.5                    424.1

        Other Income (Expense)                                   (114.2)                   137.6
                                                                -------                 --------

        Income from Continuing Operations before
            Income Taxes                                            2.3                    561.7
        Taxes on Income                                            (1.4)                  (208.7)
                                                                --------                --------

        Income from Continuing Operations                            .9                    353.0

        Discontinued Operations, Net of Income Taxes                4.6                      2.0

        Cumulative Effect of Change in Accounting
          Principle, Net of Income Taxes                              -                    (20.3)
                                                                -------                 --------

        Net Income                                              $   5.5                 $  334.7
                                                                =======                 ========
</TABLE>

Item 2.  Management's  Discussion  and  Analysis  of Results of  Operations  and
         Financial Condition.

Comparison of 2002 Results with 2001 Results

CONSOLIDATED OPERATIONS

First-quarter  2002  income from  continuing  operations  totaled  $.9  million,
compared  with $353  million for the same 2001  period.  Net income in the first
quarter of 2002 totaled $5.5 million,  compared with $334.7 million for the same
2001 period.  First-quarter  2002 operating profit was $116.5 million,  compared
with $424.1 million in the same 2001 quarter.  The decrease in operating  profit
was primarily due to significantly lower crude oil and natural gas sales prices,
higher depreciation  expense,  lower pigment sales prices and volumes and higher
pigment  per-unit  production  costs,  partially  offset by higher crude oil and
natural gas volumes and lower exploration expense.

The  first-quarter  2002 other expense  totaled  $114.2  million,  compared with
income of $137.6 million in the same 2001 period. Other income in the 2001 first
quarter  included a pretax  special gain of $181.4 million  associated  with the
reclassification  of 85% of the  company's  investment  in Devon common stock to
"trading"  from  "available for sale" (see Note B).  Excluding this item,  other
expense totaled $114.2 million in the first quarter of 2002, compared with $43.8
million  in the same 2001  quarter.  The  increase  in the 2002  quarter  is due
primarily to higher net interest expense resulting from increased debt balances,
higher losses on derivatives  marked-to-market  through income,  and losses from
equity affiliates, compared with income from equity affiliates in the prior-year
quarter.  The  losses  from  equity  affiliates  in the 2002 first  quarter  are
primarily due to a loss incurred by Avestor Limited  Partnership,  a development
stage company.

The income tax provision was $1.4 million for the 2002 first  quarter,  compared
with $208.7 million for the 2001 period.  The provision for the first quarter of
2001 included $63.5 million of tax expense  related to the  reclassification  of
the Devon stock. The remainder of the decrease is due primarily to lower income.

SEGMENT OPERATIONS

Exploration and Production -

First-quarter  2002 operating  profit was $124.4  million,  compared with $410.8
million  for the same  2001  quarter.  The  decrease  in  operating  profit  was
primarily due to lower average crude oil and natural gas sales prices and higher
depreciation expense, partially offset by higher crude oil and natural gas sales
volumes and lower exploration costs.

Revenues were $545.5 million and $758.5 million for the three months ended March
2002 and 2001,  respectively.  The following  table shows the company's  average
crude oil and natural gas sales prices and volumes for the first quarter of 2002
and 2001.
                                                        Three Months Ended
                                                             March 31,
                                                       2002              2001
                                                     ------            ------
Crude oil and condensate production
(thousands of bbls/day)
   Domestic
      Offshore                                         53.3              56.3
      Onshore                                          29.1              19.7
   North Sea                                          113.6             109.3
   Other International                                 15.4              14.2
                                                     ------            ------
          Total continuing operations                 211.4             199.5
   Discontinued operations                              2.5               2.3
                                                     ------            ------
          Total                                       213.9             201.8
                                                     ======            ======

Average crude oil sales price (per barrel)
   Domestic
      Offshore                                       $18.22            $25.03
      Onshore                                         18.32             27.57
   North Sea                                          19.60             24.91
   Other International                                17.56             23.53
   Average for continuing operations                  18.92             25.11
   Discontinued operations                           $17.81            $20.70

Natural gas sold (MMcf/day)
   Domestic
      Offshore                                          244               281
      Onshore                                           383               163
   North Sea                                            101                68
                                                     ------            ------
          Total                                         728               512
                                                     ======            ======

Average natural gas sales price (per Mcf)
   Domestic
      Offshore                                        $2.48             $7.07
      Onshore                                          2.48              7.12
   North Sea                                           2.83              3.22
   Average                                            $2.53             $6.58


Chemicals - Pigment

Operating loss in the 2002 first quarter was $11.5 million on revenues of $216.5
million,  compared with operating  profit of $36.4 million on revenues of $248.2
million for the same 2001 period.  Revenues for the 2002 first quarter decreased
due to lower sales  prices and  volumes.  First-quarter  2002  operating  profit
decreased primarily due to lower revenues and higher per-unit production costs.

Chemicals - Other

Operating profit in the 2002 first quarter was $3.6 million on revenues of $47.4
million,  compared with an operating  loss of $23.1 million on revenues of $47.1
million for the 2001 period. The 2001 first quarter included a special charge of
$24.9 million for the termination of manganese metal production at the company's
Hamilton,  Miss.,  electrolytic  chemical  facility.  This  charge is  primarily
related to plant and equipment  write-offs  and other closing  costs,  including
severance. Excluding this special charge, the 2001 operating profit totaled $1.8
million.  Excluding  special items,  operating profit for the 2002 first quarter
increased primarily due to improved results from forest products.

Financial Condition

At March 31, 2002, the company's net working capital position was $87.4 million,
compared with $192.2 million at December 31, 2001, and a negative $111.9 million
at March 31, 2001.  The current  ratio was 1.1 to 1 at March 31, 2002,  compared
with 1.2 to 1 at December 31, 2001 and .9 to 1 at March 31,  2001.  The negative
working  capital at March 31, 2001, was not indicative of a lack of liquidity as
the company maintains  sufficient  current assets to settle current  liabilities
when due.  Additionally,  the company has significant unused lines of credit and
revolving  credit  facilities as discussed  below.  Current  asset  balances are
minimized as one way to finance capital expenditures and lower borrowing costs.

The company's  percentage of net debt (debt less cash) to capitalization was 60%
at March 31, 2002,  compared  with 59% at December 31, 2001 and 42% at March 31,
2001. The company had unused lines of credit and revolving credit  facilities of
$1,256.4 million at March 31, 2002. Of this amount,  $870 million can be used to
support  commercial paper  borrowings of Kerr-McGee  Credit LLC and $320 million
can be used to support European commercial paper borrowings of Kerr-McGee (G.B.)
PLC, Kerr-McGee Chemical GmbH, Kerr-McGee Pigments (Holland) B.V. and Kerr-McGee
International ApS.

The company  increased its shelf  registration  with the Securities and Exchange
Commission  in  February  2002 to offer  up to $2  billion  of debt  securities,
preferred  stock,  common stock or warrants.  In April 2002,  the company issued
$350 million of 5.375% notes due April 15,  2005.  The proceeds  received by the
company were used to repay various short-term borrowings.

Operating  activities  provided  net cash of $273.5  million  in the 2002  first
quarter. The cash provided by operating activities and net additional borrowings
of $161.4  million in the first  quarter were  sufficient  to pay the  company's
capital expenditures of $344.2 million and dividends of $45.1 million.

Capital  expenditures  for the first three  months of 2002,  excluding  dry hole
costs and acquisitions, totaled $344.2 million, compared with $371.8 million for
the same period last year. Exploration and production expenditures,  principally
in the Gulf of Mexico  and North  Sea,  were 92% of the 2002  total.  Chemical -
pigment  expenditures were 6% of the 2002 total.  Chemical - other and corporate
incurred the remaining 2% of the expenditures.  Management  anticipates that the
cash requirements for the next several years can be provided through  internally
generated funds and selective borrowings.

Quantitative and Qualitative Disclosures About Commodity Market Risk

In  March  2002,  the  company  hedged  a  portion  of its oil and  natural  gas
production  for  the  period  April  through   December  2002  to  increase  the
predictability of its cash flows and support  additional  capital projects.  The
company  hedged  a total  of  16.5  million  barrels  of  North  Sea  crude  oil
production,  8.3  million  barrels of  domestic  crude oil  production  and 68.8
million MMBtu of domestic  natural gas  production.  The fair value of the hedge
contracts  outstanding  at March 31, 2002,  was a liability of $33.3 million for
North Sea crude oil,  $15.6 million for domestic crude oil and $24.5 million for
domestic natural gas.

                           Forward-Looking Information

Statements in this  quarterly  report  regarding  the company's or  management's
intentions,  beliefs or expectations,  or that otherwise speak to future events,
are  "forward-looking  statements"  within the meaning of the Private Securities
Litigation  Reform Act of 1995.  Future  results and  developments  discussed in
these  statements  may be affected by  numerous  factors and risks,  such as the
accuracy of the assumptions that underlie the statements, the success of the oil
and gas exploration and production program,  drilling risks, the market value of
Kerr-McGee's  products,  uncertainties in interpreting  engineering data, demand
for consumer  products for which  Kerr-McGee's  businesses supply raw materials,
general  economic  conditions,  and other  factors  and risks  discussed  in the
company's SEC filings.  Actual results and  developments  may differ  materially
from those expressed in this quarterly report.

                           PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

        The forest products  business of the company's  wholly owned  subsidiary
        Kerr-McGee  Chemical  LLC  (Chemical)  treats  railroad  ties  with wood
        preservatives.  Chemical currently operates wood treatment plants in six
        states and formerly operated wood-treatment plants in other states. Wood
        preservatives  and other substances used in the  wood-treatment  process
        are or may be present at some of these sites and require cleanup.  Costs
        associated  with the  cleanup  activities  are  accrued  when losses are
        probable  and  costs are  reasonably  estimable.  See the  Environmental
        Matters section of Management's Discussion and Analysis in the Company's
        2001  Annual  Report  on Form  10-K,  which is  incorporated  herein  by
        reference.  See also Note L. to the Consolidated Financial Statements in
        this quarterly report, which also is incorporated by reference.

        In addition, the United States Environmental Protection Agency (EPA) has
        notified Chemical that it is a potentially responsible party at a former
        wood  treatment  site in New  Jersey  that has been  listed  by EPA as a
        Superfund  site. EPA has alleged the site was once owned and operated by
        a predecessor of Chemical. Although EPA has not selected a final remedy,
        EPA has preliminarily  estimated that cleanup costs may approximate $120
        million or more.  Chemical is evaluating  possible defenses to any claim
        by EPA for  response  costs.  The company has not provided a reserve for
        the site as it is not possible to reliably estimate  whatever  liability
        Chemical  may have for the cleanup  because of  uncertainties  regarding
        Chemical's connection to the site and EPA's selection of a remedy.

        The company also is involved in litigation  in  connection  with current
        and former forest products operations.  See Item 3 of the company's 2001
        Annual Report on Form 10-K,  which is incorporated  herein by reference,
        for additional information on this and other contingencies.

        In light  of the  inherent  uncertainties  associated  with  remediation
        activities and court proceedings, there is no assurance that the company
        will not incur  liability  with respect to these  matters.  Although the
        liability  that may  result  from  these  matters  cannot be  reasonably
        estimated,  they are not expected to have a material  adverse  effect on
        the company.

Item 2. Exhibits and Reports on Form 8-K.

        (a)  Exhibits -

             Exhibit No
             ----------

                 4.1      The  company  agrees  to  furnish  the  Securities and
                          Exchange  Commission,  upon  request, a  copy  of  the
                          Prospectus Supplement to Prospectus dated February 12,
                          2002, relating to the $350 million of 5.375% notes due
                          April  15,  2005.  The  total  amount  of   securities
                          authorized under the instrument does not exceed 10% of
                          the  total  assets of the company and its subsidiaries
                          on a consolidated basis.

        (b)  Reports on Form 8-K -

             On  January  18,  2002,  the  company  filed a  report  on Form 8-K
             announcing a  conference  call to discuss its  fourth-quarter  2001
             financial and operating results.

             On  March  15,  2002,  the  company  filed a  report  on  Form  8-K
             announcing  the Board of  Directors'  decision to no longer  engage
             Arthur Andersen LLP as the company's independent public accountants
             and  appoint  Ernst & Young LLP as the  company's  new  independent
             public accountants.

             On  March  25,  2002,  the  company  filed a  report  on  Form  8-K
             announcing a conference  call to discuss its interim  first-quarter
             2002 financial and operating activities.

             On  April  19,  2002,  the  company  filed a  report  on  Form  8-K
             announcing  a  conference  call to discuss its  first-quarter  2002
             financial and operating results.

                                    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.

                                       KERR-McGEE CORPORATION

  Date  May 13, 2002                   By: (John M. Rauh)
        ------------                   -------------------------------
                                            John M. Rauh
                                              Vice President and Controller
                                              and Chief Accounting Officer