FORM 10-Q
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549


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

                  For the Quarterly Period Ended June 30, 1998

                                       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 1-3939


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


               A Delaware Corporation                73-0311467
           (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 July 31,
1998:  47,741,023

<PAGE>
                                              
                         PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.
<TABLE>

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

                                                  Three Months Ended        Six Months Ended
                                                       June 30,                 June 30,
(Millions of dollars, except per-share amounts)   1998           1997       1998          1997
                                                 --------------------     --------------------

<S>                                              <C>           <C>        <C>           <C>   
Sales                                            $394.6        $335.5     $685.5        $719.3
                                                 ------        ------     ------        ------

Costs and Expenses
   Costs and operating expenses                   228.6         183.8      383.7         386.8
   Selling, general and administrative expenses    38.2          24.8       66.5          57.9
   Depreciation and depletion                      73.2          60.8      134.6         123.5
   Exploration, including dry holes and
      amortization of undeveloped leases           20.5          14.6       39.2          25.5
   Taxes, other than income taxes                   5.2           4.8       10.3          11.5
   Interest and debt expense                       17.1          11.0       29.7          22.8
                                                 ------        ------     ------        ------
         Total Costs and Expenses                 382.8         299.8      664.0         628.0
                                                 ------        ------     ------        ------

                                                   11.8          35.7       21.5          91.3
Other Income                                       11.7          17.9       25.9          47.3
                                                 ------        ------     ------        ------

Income from Continuing Operations
   before Income Taxes                             23.5          53.6       47.4         138.6
Provision (Benefit) for Income Taxes               (2.5)         17.3        5.5          43.8
                                                 ------        ------     ------        ------

Income from Continuing Operations                  26.0          36.3       41.9          94.8

Income from Discontinued Operations (net of
 provision for income taxes of $31.6 and $.5
 for the second quarter of 1998 and 1997,
 respectively, and $34.0 and $4.2 for the first
 six months of 1998 and 1997, respectively)        51.5           5.3       59.5          17.0
                                                 ------        ------     ------        ------

Net Income                                       $ 77.5        $ 41.6     $101.4        $111.8
                                                 ======        ======     ======        ======

Net Income per Common Share
   Basic
      Continuing operations                      $ .55         $  .76     $  .88        $ 1.98
      Discontinued operations                     1.08            .11       1.25           .35
                                                 -----         ------     ------        ------

         Total                                   $1.63         $  .87     $ 2.13        $ 2.33
                                                 =====         ======     ======        ======

   Diluted
      Continuing operations                      $ .55         $  .76     $  .88        $ 1.97
      Discontinued operations                     1.07            .11       1.24           .35
                                                 -----         ------     ------        ------

         Total                                   $1.62         $  .87     $ 2.12        $ 2.32
                                                 =====         ======     ======        ======



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

<PAGE>

<TABLE>

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


                                                                  June 30,   December 31,
(Millions of dollars)                                                 1998           1997
                                                                   ----------------------

<S>                                                               <C>            <C>
ASSETS
Current Assets
   Cash                                                           $   88.6       $  182.6
   Notes and accounts receivable                                     346.1          274.3
   Inventories                                                       222.8          172.2
   Deposits and prepaid expenses                                      68.2           59.4
                                                                   -------       --------
      Total Current Assets                                           725.7          688.5
                                                                   -------       --------

Property, Plant and Equipment                                      4,918.1        4,602.1
   Less reserves for depreciation,
   depletion and amortization                                      2,374.9        2,603.7
                                                                   -------       --------
                                                                   2,543.2        1,998.4

Investments and Other Assets                                         417.5          409.2
                                                                   -------       --------

                                                                  $3,686.4       $3,096.1
                                                                  ========       ========


LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
   Short-term borrowings                                           $     -       $   25.0
   Accounts payable                                                  259.6          247.1
   Other current liabilities                                         304.0          250.9
                                                                   -------       --------
      Total Current Liabilities                                      563.6          523.0
                                                                   -------       --------

Long-Term Debt                                                       888.5          552.0
                                                                   -------       --------

Deferred Credits and Reserves                                        729.7          581.1
                                                                   -------       --------

Stockholders' Equity
   Common stock, par value $1 - 150,000,000
      shares authorized, 54,174,271 shares issued at
      6-30-98 and 54,120,747 shares issued at 12-31-97                54.2           54.1
   Capital in excess of par value                                    348.4          345.8
   Preferred stock purchase rights                                      .5             .5
   Retained earnings                                               1,514.2        1,455.7
   Accumulated other comprehensive income (loss)                       (.7)            .1
   Common shares in treasury, at cost - 6,433,415
      shares at 6-30-98 and 6,434,465 at 12-31-97                   (362.3)        (362.4)
   Deferred compensation                                             (49.7)         (53.8)
                                                                   -------       --------
      Total Stockholders' Equity                                   1,504.6        1,440.0
                                                                   -------       --------

                                                                  $3,686.4       $3,096.1
                                                                  ========       ========


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>

<PAGE>

<TABLE>

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


                                                                          Six Months Ended
                                                                              June 30,
(Millions of dollar)                                                      1998          1997
                                                                        --------------------

<S>                                                                     <C>           <C>
Operating Activities
Net income                                                              $101.4        $111.8
Adjustments to reconcile to net cash
   provided by operating activities -
      Depreciation, depletion and amortization                           152.7         138.2
      Deferred income taxes                                               (2.0)         22.9
      Gain on sale of discontinued coal operations                       (41.7)            -
      Loss (gain) on sale and retirement of assets                        16.2          (2.9)
      Realized gain on available-for-sale securities                         -         (10.7)
      Noncash items affecting net income                                 (26.6)         (5.3)
      Other net cash provided by operating activities                    (76.2)         77.1
                                                                        ------        ------
         Net Cash Provided by Operating Activities                       123.8         331.1
                                                                        ------        ------

Investing Activities
Capital expenditures                                                    (222.3)       (156.9)
Acquisitions                                                            (517.9)            -
Proceeds from the sale of discontinued coal operations                   198.8             -
Proceeds from sale of assets                                              46.9           7.8
Other investing activities                                                 4.5          31.4
                                                                        ------        ------
         Net Cash Used in Investing Activities                          (490.0)       (117.7)
                                                                        ------        ------


Financing Activities
Issuance of long-term debt                                               385.3             -
Repayment of long-term debt                                              (47.8)       (158.5)
Decrease in short-term borrowings                                        (25.0)        (16.4)
Purchase of treasury stock                                                   -         (49.1)
Dividends paid                                                           (42.9)        (41.5)
Other financing activities                                                 2.6           7.9
                                                                        ------        ------
         Net Cash Used in Financing Activities                           272.2        (257.6)
                                                                        ------        ------

Net Increase in Cash and Cash Equivalents                                (94.0)        (44.2)

Cash and Cash Equivalents at Beginning of Period                         182.6         120.9
                                                                        ------        ------

Cash and Cash Equivalents at End of Period                              $ 88.6        $ 76.7
                                                                        ======        ======


The accompanying notes are an integral part of this statement.

</TABLE>
<PAGE>

                 KERR-McGEE CORPORATION AND SUBSIDIARY COMPANIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  JUNE 30, 1998

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  generally  accepted
     accounting principles 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.

B.   The company  committed to formal plans for the sale of its coal  operations
     in the second quarter of 1998; therefore, coal operations are reported as a
     discontinued operation. During the second quarter of 1998, the company sold
     its Galatia  Mine in the Illinois  Basin to the  American  Coal Company for
     $200 million in cash. On July 23, 1998,  the company  completed the sale of
     the Jacobs Ranch surface mine operation in Wyoming to Kennecott  Energy and
     Coal Company for $400 million cash. The two  negotiated  sales are expected
     to result in an after-tax  gain of  approximately  $260  million,  of which
     $41.7 million was reported in the second  quarter of 1998. The net proceeds
     to be received by the company will be used to purchase the company's  stock
     and for general corporate purposes.

    Revenues applicable to the discontinued  operation totaled $81.9 million and
    $76.2   million  for  the  three  months  ended  June  30,  1998  and  1997,
    respectively, and $160.1 million and $160.4 million for the six months ended
    June 30, 1998 and 1997,  respectively.  Coal assets not yet sold at June 30,
    1998 are included as part of the appropriate  line items in the Consolidated
    Balance Sheet.  Included at June 30, 1998, are  inventories of $3.9 million;
    net  property,   plant  and  equipment  of  $82.6  million;   other  current
    liabilities of $6.5 million; and other deferred credits of $40.3 million.

    The company's  Consolidated  Statement of Income for the year ended December
    31, 1997,  restated for the effects of the  discontinued  coal  operation is
    presented below.

    (Millions of dollars)

    Sales                                                    $1,388.3

    Costs and expenses                                          738.8
    General and administrative expenses                         137.4
    Depreciation and depletion                                  238.7
    Exploration, including dry holes and
        amortization of undeveloped leases                       64.7
    Taxes, other than income taxes                               20.5
    Interest and debt expenses                                   46.5
                                                              -------
        Total Costs and Expenses                              1,246.6
                                                                141.7
    Other Income                                                 90.4
    Income from continuing operations
        before Income Taxes                                     232.1
    Provision for Income Taxes                                   71.0
                                                              -------
    Income from Continuing Operations                           161.1
    Income from Discontinued Operations (net of
        provision for income taxes of $12.3)                     32.7
                                                              -------

    Net income                                                $ 193.8
                                                              =======

    Net Income per Common Share - diluted
        Continuing operations                                 $  3.36
        Discontinued operations                                   .68
                                                              -------
           Total                                              $  4.04
                                                              =======

C.   Income from  continuing  operations  for purposes of  computing  both basic
     earnings  per share and diluted  earnings  per share was $26.0  million and
     $36.3  million  for  the  three  months  ended  June  30,  1998  and  1997,
     respectively,  and $41.9 million and $94.8 million for the six months ended
     June 30,  1998 and 1997,  respectively.  A  reconciliation  of the  average
     shares  outstanding  used to compute basic earnings per share to the shares
     used to compute  diluted  earnings per share for the  indicated  periods is
     presented below:

<TABLE>
<CAPTION>

                                                 Three Months Ended      Six Months Ended
                                                      June 30,               June 30,
    (Millions of shares)                         1998          1997      1998         1997
                                                 ------------------      -----------------

    <S>                                          <C>           <C>       <C>          <C> 
    Averages shares outstanding - basic          47.7          47.8      47.7         48.0
    Dilutive effect of stock options               .2            .2        .2           .2
                                                 ----          ----      ----          ---
    Average shares outstanding assuming dilution 47.9          48.0      47.9         48.2
                                                 ====          ====      ====         ====
</TABLE>

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

                                                      Six Months Ended
                                                          June 30,
    (Millions of dollars)                            1998          1997
                                                     ------------------

    Income taxes                                    $14.1         $13.8
    Interest                                         27.9          28.2

E.  During the second  quarter  of 1998 and 1997,  comprehensive  income was $78
    million and $36.1 million,  respectively.  For the six months ended June 30,
    1998 and 1997,  comprehensive  income was $101.9 million and $104.6 million,
    respectively.  Adoption  of this  standard  had no effect  on the  company's
    results of  operations  or financial  position as reported  elsewhere in the
    consolidated financial statements.

    The company held U.S. government  obligations considered to be available for
    sale at June 30, 1998, and December 31, 1997.  These  financial  instruments
    are carried in the Consolidated  Balance Sheet at fair value, which is based
    on quoted  market  prices.  The fair  value of these  financial  instruments
    totaled $27.9 million at June 30, 1998, which approximated cost. At December
    31, 1997, the fair value of the financial instruments totaled $27.5 million,
    which approximated  cost. The company held no securities  classified as held
    to maturity or trading during the respective periods.

    During 1997, the company sold equity  securities  considered to be available
    for sale. Proceeds from the sale during the 1997 second quarter totaled $7.7
    million,  resulting in a realized gain of $6.6 million  before income taxes.
    Proceeds  from the sale for the  first  six  months  of 1997  totaled  $12.4
    million,  resulting in a realized gain of $10.7 million before income taxes.
    The average cost of the  securities was used in computing the realized gain.
    During the second quarter of 1997, the company  donated 50,000 shares of its
    available-for-sale  securities to the Kerr-McGee Foundation  Corporation,  a
    tax-exempt   entity  whose  purpose  is  to  contribute  to   not-for-profit
    organizations.  The fair value of these donated shares totaled $3.2 million,
    which includes appreciation of $2.8 million before income taxes.

F.  Investments in equity affiliates  totaled $282 million at June 30, 1998, and
    $272.9  million  at  December  31,  1997.   Equity  income  related  to  the
    investments  is included in Other  Income in the  Consolidated  Statement of
    Income and totaled  $5.5 million and $6.5 million for the three months ended
    June 30,  1998 and 1997,  respectively,  and $12 million and $16 million for
    the six months ended June 30, 1997.

G.  CONTINGENCIES

    WEST CHICAGO -

    In 1973, a wholly owned subsidiary,  Kerr-McGee Chemical Corporation, closed
    the facility located in West Chicago, Illinois, that processed thorium ores.
    Kerr-McGee  Chemical  Corporation  now operates as  Kerr-McGee  Chemical LLC
    (Chemical).  Operations resulted in some low-level radioactive contamination
    at the site, and in 1979,  Chemical filed a plan with the Nuclear Regulatory
    Commission  (NRC)  to  decommission   the  facility.   The  NRC  transferred
    jurisdiction  of this site to the State of Illinois (the State) in 1990. The
    following  discusses the current status of various  matters  associated with
    the West Chicago site.

    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 as to the
    terms and conditions for completing the final phase of decommissioning work.
    The State  indicated  approval  of this  agreement  and has  issued  license
    amendments  authorizing  much of the work.  Chemical expects the majority of
    the work to be completed within six 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.
    The  storage fee cannot  exceed $26  million  per year,  and any storage fee
    payments  must be  reimbursed  to  Chemical  as  decommissioning  costs  are
    incurred.  Chemical  has been 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.

    Offsite Areas - The U.S.  Environmental  Protection  Agency (EPA) has listed
    four areas in the  vicinity of the West  Chicago  facility  on the  National
    Priority List that the EPA promulgates  under authority of the Comprehensive
    Environmental  Response,  Compensation,  and  Liability  Act of 1980 and has
    designated Chemical as a potentially  responsible party in these four areas.
    The EPA  issued  unilateral  administrative  orders  for two of these  areas
    (referred to as the residential area 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 has begun the cleanup of these two sites.

    Judicial  Proceedings  - In December  1996, a lawsuit was filed  against the
    company and Chemical, in Illinois state court on behalf of a purported class
    of present and former West Chicago residents.  The lawsuit seeks damages for
    alleged  diminution in property  values and the  establishment  of a medical
    monitoring  fund to  benefit  those  allegedly  exposed  to  thorium  wastes
    originating from the former facility.  The case was removed to federal court
    and is being vigorously defended.

    Government  Reimbursement  - Pursuant to Title X of the Energy Policy Act of
    1992  (Title X), the United  States  Department  of Energy 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 1996 to
    increase the amount  authorized to $65 million plus  inflation  adjustments.
    Through  July 31,  1998,  Chemical  has been  reimbursed  approximately  $54
    million under Title X.

    OTHER MATTERS

    The plants and facilities of the company and its subsidiaries are subject to
    various environmental laws and regulations.  The company or its subsidiaries
    have been notified  that they may be  responsible  in varying  degrees for a
    portion of the costs to clean up  certain  waste  disposal  sites and former
    plant sites.  As of June 30, 1998,  the  company's  estimate for the cost to
    investigate  and/or  remediate all presently  identified  sites of former or
    current  operations,  based on  currently  known  facts  and  circumstances,
    totaled  $249  million,  which  includes  $149  million  for the former West
    Chicago  facility and $13 million for the residential  area and Reed-Keppler
    Park.  Reserves have been established  based on this estimate.  Expenditures
    are reduced by the amounts recovered under government programs. Expenditures
    from  inception  through June 30, 1998,  totaled $470 million for  currently
    known sites.

    In addition to the environmental issues previously discussed, the company or
    its  subsidiaries  are also a party to a number of other  legal  proceedings
    pending in various  courts or agencies in which the company or a  subsidiary
    appears as  plaintiff  or  defendant.  The  ultimate  costs to  decommission
    presently  known sites are  difficult  to estimate  because of the  numerous
    contingencies,  including  continually  changing laws and  regulations,  the
    nature of the company's  businesses  and pending legal  proceedings.  Actual
    costs could differ from those  currently  estimated as  information  becomes
    available  for  sites  that  are  not  now  included  in  the  reserve,   if
    contamination  is not as expected,  or field  conditions or other  variables
    differ significantly from those that are now assumed.  Therefore,  it is not
    possible  to  reliably   estimate   the  amount  or  timing  of  all  future
    expenditures relating to environmental and other contingencies.  The company
    provides for costs related to contingencies  when a loss is probable and the
    amount  is  reasonably  estimable.   Although  management  believes,   after
    consultation with general counsel, that adequate reserves have been provided
    for all known contingencies, the ultimate cost will depend on the resolution
    of the above-noted uncertainties.  Therefore, it is possible that additional
    reserves could be required in the future.


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

Comparison of 1998 Results with 1997 Results

CONSOLIDATED OPERATIONS

Income  from  continuing  operations  for the 1998  second  quarter  totaled $26
million, compared with $36.3 million for the same 1997 period. For the first six
months of 1998, income from continuing  operations was $41.9 million,  down from
$94.8 million for the 1997 period.

Second-quarter  1998 net  income  totaled  $77.5  million,  compared  with $41.6
million for the same 1997 period.  For the first six months of 1998,  net income
totaled $101.4 million, compared with $111.8 million for the same 1997 period.

Operating profit decreased for both the second quarter and six months ended June
30, 1998, compared with the same 1997 periods.  Higher chemical operating profit
in both 1998 periods,  compared with the same 1997 periods, was more than offset
by lower operating profit from exploration and production.  The decline for both
periods was due primarily to lower crude oil sales prices,  higher  depreciation
and depletion expense and higher exploration expense, partially offset by higher
crude oil sales volumes, higher titanium dioxide pigment sales prices and income
from the newly acquired European pigment operations.  Also benefiting the second
quarter were higher  natural gas sales volumes and prices.  Contributing  to the
decline in the first six months were lower  natural gas sales  prices and higher
pigment production costs.

Other  expense for  second-quarter  1998 was $20.1  million,  compared  with $.6
million for the 1997  quarter.  The increase was due primarily to higher loss on
sale of assets,  1997 gains on sales of equity  securities and higher litigation
costs,  partially offset by lower net interest expense and 1998 foreign currency
transaction  gains  compared  with 1997 losses.  Other expense for the first six
months of 1998 was $30.1,  compared  with other  income of $1.2  million for the
1997 period due primarily to higher loss on sale of assets, 1997 gain on sale of
equity  securities  and  lower  equity  income,  partially  offset  by lower net
interest expense.  Net interest expense for both 1998 periods declined primarily
due to higher interest income resulting from an income tax settlement.

The  provision  (benefit)  for income taxes for both the second  quarter and six
months ended June 30, 1998,  included a tax benefit of $11.1  million  resulting
from an income tax settlement.  Excluding this special item in both periods, the
provision  for income  taxes was $8.6  million and $16.6  million for the second
quarter and first six months of 1998, respectively,  compared with $17.3 million
and $43.8  million for the  respective  1997 period.  The decrease for both 1998
periods was due to lower pretax income, partially offset by higher effective tax
rates.

SEGMENT OPERATIONS

Following is a summary of sales and  operating  profit and a discussion of major
factors  influencing the results of each of the company's  business segments for
the second quarter and first six months of 1998,  compared with the same periods
last year.
<TABLE>
<CAPTION>

                                         Three Months Ended           Six Months Ended
                                              June 30,                    June 30,
(Millions of dollars)                    1998           1997          1998          1997
                                        --------------------        --------------------

<S>                                     <C>           <C>           <C>            <C> 
Sales
    Exploration and production          $128.7        $146.5        $241.3         $346.8
    Chemicals                            265.8         189.0         444.0          372.4
                                        ------        ------        ------         ------
                                         394.5         335.5         685.3          719.2
    All other                              .1              -            .2             .1
                                        -----         ------        ------         ------
        Total Sales                     $394.6        $335.5        $685.5         $719.3
                                        ======        ======        ======         ======

Operating Profit
    Exploration and production          $  8.8        $ 32.5        $ 20.8         $100.5
    Chemicals                             34.8          21.7          56.7           36.9
                                        ------        ------        ------         ------
        Total Operating Profit            43.6          54.2          77.5          137.4

Other Income (Expense)                   (20.1)          (.6)        (30.1)           1.2
                                        ------        ------        ------         ------

Income from Continuing Operations
    before Income Taxes                   23.5          53.6          47.4          138.6

Provision (Benefit) for Income Taxes      (2.5)         17.3           5.5           43.8
                                        ------        ------        ------         ------
Income from Continuing Operations         26.0          36.3          41.9           94.8

Discontinued Operations, Net of
        Income Taxes                      51.5           5.3          59.5           17.0
                                        ------        ------        ------         ------

Net Income                              $ 77.5        $ 41.6        $101.4         $111.8
                                        ======        ======        ======         ======
</TABLE>

<PAGE>

Exploration and Production -

Operating profit for the second quarter of 1998 was $8.8 million,  compared with
$32.5  million  for the same 1997  period.  Operating  profit  for the first six
months of 1998 and 1997 was $20.8 million and $100.5 million,  respectively. The
decrease in operating  profit for both periods was due  primarily to lower crude
oil  sales  prices,   higher  depreciation  and  depletion  expense  and  higher
exploration  expense,  partially  offset by higher crude oil sales volumes.  The
higher  volumes  in the  second-quarter  1998 were  mainly  attributable  to the
acquisition of Gulf Canada Resources Limited's North Sea assets.  Offsetting the
second-quarter decline in operating profit were higher natural gas sales volumes
and prices.  The lower  operating  profit for the six month period also reflects
lower natural gas sales prices.

Revenues were $128.7  million and $146.5 million for the three months ended June
30, 1998 and 1997,  respectively,  and $241.3 million and $346.8 million for the
first six months of 1998 and 1997,  respectively.  The following table shows the
company's  average  crude oil and natural gas sales  prices and volumes for both
the second quarter and first six months of 1998 and 1997.

<TABLE>
<CAPTION>


                                   Three Months Ended                   Six Months Ended
                                        June 30,        Increase            June 30,        Increase
                                    1998       1997    (Decrease)       1998       1997    (Decrease)
                                  -------------------------------      ------------------------------

<S>                               <C>        <C>           <C>        <C>        <C>           <C>
Crude oil sales
 (thousands of bbls/day)
   United States                    23.5       25.1         (6)         23.3       25.2         (8)
   North Sea                        38.6       22.6         71          29.8       24.3         23
   China                             7.6       10.2        (25)          8.3        8.5         (2)
   Other                             3.0          -         NM           2.5          -         NM
                                    ----       ----                     ----       ----
     Total proprietary sales        72.7       57.9         26          63.9       58.0         10
   Proportionate interest in
     equity affiliate's sales        7.1        7.4         (4)          7.2        7.4         (3)
                                    ----       ----                     ----       ----
       Total                        79.8       65.3         22          71.1       65.4          9
                                    ====       ====                     ====       ====

Average crude oil sales price
 (per barrel)
   United States                  $11.78     $17.48        (33)       $12.70     $19.19        (34)
   North Sea                       12.55      17.19        (27)        12.96      19.49        (34)
   China                           12.43      16.52        (25)        12.62      18.16        (31)
   Other                           12.68          -         NM         13.03          -         NM
     Average                      $12.29     $17.21        (29)       $12.83     $19.16        (33)

Natural gas sold
 (MMCF/day)
   United States                     180        163         10           167        173         (3)
   North Sea                          34         28         21            34         31         10
                                    ----       ----                     ----       ----
     Total proprietary sales         214        191         12           201        204         (1)
   Proportionate interest in
     equity affiliate's sales         63         59          7            63         59          7
                                    ----       ----                     ----       ----

       Total                         277        250         11           264        263          -
                                    ====       ====                     ====       ====

Average natural gas sales price
 (per MCF)
   United States                   $2.24      $2.11          6         $2.24      $2.47         (9)
   North Sea                        2.35       2.26          4          2.64       2.65          -
     Average                       $2.25      $2.13          6         $2.31      $2.49         (7)
</TABLE>


Chemicals -

Second-quarter  1998  operating  profit was $34.8  million on revenues of $265.8
million,  compared  with  operating  profit of $21.7 million on revenues of $189
million  for the same 1997  quarter.  For the first six months of 1998 and 1997,
operating profit was $56.7 million and $36.9 million,  respectively, on revenues
of $444 million and $372.4 million, respectively. Revenues for both 1998 periods
increased due to higher sales volumes resulting from the newly acquired European
titanium dioxide pigment  operations and higher pigment sales prices.  Operating
profit  for both  1998  periods  increased  primarily  due to  higher  revenues,
partially offset by higher pigment production costs.

Financial Condition

At June 30, 1998, the company's net working capital position was $162.1 million,
compared with $165.5  million at December 31, 1997. The current ratio was 1.3 to
1 at June 30, 1998, which is unchanged from both December 31, 1997, and June 30,
1997. The company's  percentage of total debt to total capitalization was 37% at
June 30, 1998, compared with 29% at December 31, 1997, and 26% at June 30, 1997.

The company had unused lines of credit and revolving  credit  facilities of $738
million at June 30, 1998.  Of this amount,  $380 million and $240 million can be
used to support commercial paper borrowings of Kerr-McGee Credit Corporation LLC
and Kerr-McGee Oil (U.K.)
PLC, respectively.

On May 15, 1998,  Kerr-McGee Resources (U.K.),  Kerr-McGee Andrew and Kerr-McGee
Dorset,  all wholly owned  limited  liability  companies in the United  Kingdom,
entered  into a  revolving  credit  agreement  with  various  banks  to  provide
borrowings up to $76 million at varying rates through May 15, 2003.  The company
and Kerr-McGee  (G.B.)  Limited are the guarantors of the agreement.  A total of
$76 million was outstanding at June 30, 1998.

Cash  capital   expenditures  for  the  first  six  months  of  1998,  excluding
acquisitions,  totaled $222.3 million, compared with $156.9 million for the same
period last year.  Exploration and production  expenditures,  principally in the
Gulf of  Mexico,  North  Sea and  offshore  China,  were 81% of the 1998  total.
Chemical expenditures were 14% of the 1998 amount.  Management  anticipates that
the cash  requirements  for the  next  several  years  can be  provided  through
internally generated funds and selective short-term and/or long-term borrowings.

On July 14, 1998,  the  company's  Board of Directors  authorized  management to
purchase from time to time company stock of up to $300 million, or approximately
11% of the outstanding shares at the then current market price.

                           PART II - OTHER INFORMATION

Item 1.  Legal Proceedings.

         None

Item 6.  Exhibits and Reports on Form 8-K.

     (a) Exhibits -

          4.6  The  company  agrees to furnish to the  Securities  and  Exchange
               Commission,  upon  request,  a copy  of the  $76  million  Credit
               Agreement dated May 15, 1998, between Kerr-McGee Resources (U.K.)
               Limited, Kerr-McGee Andrew Limited, Kerr-McGee Dorset Limited and
               various  banks  providing for  revolving  credit  through May 15,
               2003.

         27.0  Financial Data Schedule

     (b) Reports on Form 8-K

         On June 8, 1998, the company filed a report on Form 8-K announcing that
         it has reached  agreements to sell its coal operations for $600 million
         in cash.

                                          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 August 7, 1998                         By:   (Deborah A. Kitchens)
     --------------                               ---------------------
                                                   Deborah A. Kitchens
                                                   Vice President and Controller
                                                    and Chief Accounting Officer