Edgar Filing: NOBLE AFFILIATES INC

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

SCHEDULE 14A
(RULE 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION

PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )

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Noble Affiliates, Inc.
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(Name of Registrant as Specified In Its Charter)

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NOBLE AFFILIATES, INC.
350 Glenborough Drive
Suite 100
Houston, Texas 77067

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON APRIL 23, 2002

To the Stockholders of
NOBLE AFFILIATES, INC.:

The annual meeting of stockholders of Noble Affiliates, Inc., a Delaware
corporation (the "Company"), will be held on Tuesday, April 23, 2002, at 9:30
a.m., Central time, at the Wyndham Greenspoint Hotel, located at 12400
Greenspoint Drive, Houston, Texas 77060, for the following purposes:

1. To elect the Board of Directors for the ensuing year;

2. To consider and vote upon a proposal to amend the Certificate of
Incorporation of the Company (the "Charter"), in order to change the
name of the Company to Noble Energy, Inc.;

3. To consider and vote upon a shareholder proposal that is described
beginning on page 5 of this proxy statement; and

4. To transact such other business as may properly come before the
meeting or any adjournment thereof.

The Board of Directors has fixed the close of business on March 11, 2002
as the record date for the determination of stockholders entitled to notice of
and to vote at the meeting or any adjournment thereof. Only stockholders of
record at the close of business on the record date are entitled to notice of and
to vote at the meeting. A complete list of such stockholders will be available
for examination at the offices of the Company in Houston, Texas, during ordinary
business hours for a period of 10 days prior to the meeting.

A record of the Company's activities during 2001 and financial statements
for the fiscal year ended December 31, 2001 are contained in the 2001 Annual
Report on Form 10-K. The Annual Report does not form any part of the material
for solicitation of proxies.

All stockholders are cordially invited to attend the meeting. STOCKHOLDERS
ARE URGED, WHETHER OR NOT THEY PLAN TO ATTEND THE MEETING, TO COMPLETE, DATE AND
SIGN THE ACCOMPANYING PROXY AND TO RETURN IT PROMPTLY IN THE POSTAGE-PAID RETURN
ENVELOPE PROVIDED. If a stockholder who has returned a proxy attends the meeting
in person, such stockholder may revoke the proxy and vote in person on all
matters submitted at the meeting.

By Order of the Board of Directors

Albert D. Hoppe
Senior Vice President, General Counsel
and Secretary

Houston, Texas
March 29, 2002

NOBLE AFFILIATES, INC.
350 Glenborough Drive
Suite 100
Houston, Texas 77067

PROXY STATEMENT

FOR ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON APRIL 23, 2002

INTRODUCTION

The accompanying proxy, mailed together with this proxy statement, is
solicited by and on behalf of the Board of Directors of the Company for use at
the annual meeting of stockholders of the Company to be held on April 23, 2002,
and at any adjournment thereof. The approximate date on which this proxy
statement and the accompanying proxy were first sent to stockholders of the
Company is March 29, 2002.

Shares represented by valid proxies will be voted at the meeting in
accordance with the directions given. If no direction is indicated, the shares
will be voted (i) for election of the nominees for director named in the proxy;
(ii) for the proposal to amend the Certificate of Incorporation of the Company
(the "Charter") in order to change the name of the Company to Noble Energy,
Inc.; and (iii) against the shareholder proposal that is described beginning on
page 5 of this proxy statement. Any stockholder of the Company returning a proxy
has the right to revoke the proxy at any time before it is voted by
communicating such revocation in writing to Albert D. Hoppe, Secretary, Noble
Affiliates, Inc., 350 Glenborough Drive, Suite 100, Houston, Texas 77067, or by
executing and delivering a proxy bearing a later date. No revocation by written
notice or by delivery of another proxy shall be effective until such notice of
revocation or other proxy, as the case may be, has been received by the Company
at or prior to the meeting.

In order for an item of business proposed by a stockholder to be
considered properly brought before the annual meeting of stockholders as an
agenda item or to be included in the proxy statement, the By-laws of the
Company, as amended by the Board of Directors on January 29, 2002 and thereafter
filed with the Securities and Exchange Commission (the "SEC"), require that such
stockholder give written notice to the Secretary of the Company. The notice must
specify certain information concerning such stockholder and the item of business
proposed to be brought before the meeting. The notice must be received by the
Secretary of the Company not later than 120 calendar days before the first
anniversary of the release date of the previous year's annual meeting proxy
statement; provided, however, that in the event that (i) no annual meeting was
held in the previous year or (ii) the date of the annual meeting has changed by
more than 30 days from the date of the previous year's meeting, notice by the
stockholder to be timely must be received no later than the close of business on
the tenth day following the earlier of the day on which notice of the meeting
date was mailed or public disclosure of the meeting date was made. Accordingly,
the Company must receive any such stockholder notice in connection with the 2003
annual meeting of stockholders no later than November 29, 2002.

VOTING PROCEDURES AND TABULATION

The Company will appoint one or more inspectors of election to act at the
meeting and to make a written report thereof. Prior to the meeting, the
inspectors will sign an oath to perform their duties in an impartial manner and
according to the best of their ability. The inspectors will ascertain the number
of shares outstanding and the voting power of each, determine the shares
represented at the meeting and the validity of proxies and ballots, count all
votes and ballots, and perform certain other duties as required by law.

The inspectors will tabulate the number of votes cast for or withheld from
each nominee for director. Votes that are withheld will be excluded entirely
from the vote and will have no effect. Under the rules of the New York Stock
Exchange, brokers who hold shares in street name have the authority to vote on
certain "routine" items when they have not received instructions from beneficial
owners. Brokers will have discretionary authority to vote on the

election of directors. Under applicable Delaware law and the Company's
Certificate of Incorporation and By-laws, a broker non-vote or other limited
proxy will have no effect on the outcome of the election of directors.

VOTING SECURITIES

Only holders of record of common stock of the Company, par value $3.33 1/3
per share (the "Common Stock"), at the close of business on March 11, 2002, the
record date for the meeting, are entitled to notice of and to vote at the
meeting. A majority of the shares of Common Stock entitled to vote, present in
person or represented by proxy is necessary to constitute a quorum. On the
record date for the meeting, there were issued and outstanding 57,020,557 shares
of Common Stock. Each share of Common Stock is entitled to one vote.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS

The following tabulation sets forth as of March 11, 2002 information with
respect to the only persons who were known to the Company to be beneficial
owners of more than five percent of the outstanding shares of Common Stock.

NAME AND ADDRESS NUMBER OF SHARES PERCENT
OF BENEFICIAL OWNER BENEFICIALLY OWNED (1) OF CLASS
------------------- ---------------------- --------

PRIMECAP Management Company............................ 6,023,100 (2) 10.6%
225 South Lake Avenue, #400
Pasadena, CA 91101-3005

Capital Research & Management.......................... 3,431,000 6.0%
333 South Hope
Los Angeles, CA 90071

The Samuel Roberts Noble Foundation, Inc............... 3,108,633 (3) 5.5%
P. O. Box 2180
Ardmore, Oklahoma 73402

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(1) Unless otherwise indicated, all shares listed are directly held with sole
voting and investment power.

(2) Beneficial ownership of such shares was reported in Amendment No. 1 to
Schedule 13G dated December 31, 2001, filed with the SEC by PRIMECAP
Management Company. Included in the shares that are beneficially owned by
PRIMECAP Management Company is 3,600,000 shares of Common Stock in which
shared disposition power and sole voting rights are owned by Vanguard
PRIMECAP Fund.

(3) The Samuel Roberts Noble Foundation, Inc. (the "Foundation") is an
Oklahoma not-for-profit corporation organized in 1952 as successor to a
charitable trust formed in 1945. The Foundation is engaged in basic plant
biology research and agricultural research, consultation and
demonstration. From time to time as funds are available, the Foundation
also makes grants to various charitable organizations. Michael A. Cawley,
a director of the Company, serves as President, Chief Executive Officer
and a trustee of the Foundation. In the event of a vacancy in a
trusteeship of the Foundation, a majority of the remaining trustees has
the power to elect a successor trustee to fill the vacancy.

ELECTION OF DIRECTORS

Six directors, constituting the entire Board of Directors, are to be
elected at the meeting to serve until the next annual meeting of stockholders
and until their successors have been elected and qualified. Five of the current
nominees for director were elected directors of the Company by vote of the
stockholders at the 2001 annual meeting. Alan A. Baker is not a nominee for
reelection. Mr. Baker, who turned 70 in February 2002, will retire from his
position on the Board of Directors and all committees on which he serves, in
accordance with the Company's

director retirement policy, on the date of the annual meeting. Mr. Baker has
been a director of the Company since 1995. T. Don Stacy will not stand for
re-election to the Board of Directors. Mr. Stacy has been a director of the
Company since 1998. In accordance with the Company's By-laws, the number of
directors constituting the entire Board has been decreased to six, effective
immediately after the annual meeting of stockholders.

Generally, the Company's By-laws provide that a stockholder must deliver
written notice to the Secretary of the Company not later than 90 days prior to
the annual meeting naming such stockholder's nominee(s) for director and
specifying certain information concerning such stockholder and nominee(s).
Accordingly, a stockholder's nominee(s) for director to be presented at the 2003
annual meeting of stockholders must be received by the Company no later than
January 22, 2003.

Directors are elected by plurality vote. All duly submitted and unrevoked
proxies in the form accompanying this proxy statement will be voted for the
nominees selected by the Board of Directors, except where authorization so to
vote is withheld. THE BOARD RECOMMENDS THAT STOCKHOLDERS VOTE FOR THE ELECTION
OF SUCH NOMINEES.

NOMINEES FOR DIRECTOR

MICHAEL A. CAWLEY -- Mr. Cawley has served as President and Chief Executive
Officer of the Foundation since February 1, 1992, after serving as Executive
Vice President of the Foundation since January 1, 1991. Prior to 1991, Mr.
Cawley was the President of Thompson & Cawley, a professional corporation,
attorneys at law. Mr. Cawley, age 54, has served as a trustee of the Foundation
since 1988 and is also a director of Panhandle Royalty Company and Noble
Drilling Corporation. He has served as a director of the Company since 1995 and
its Lead Independent Director since 2001.

EDWARD F. COX -- Mr. Cox has been a partner in the law firm of Patterson,
Belknap, Webb & Tyler LLP, New York, New York since March 1998. Prior thereto,
he was a Partner in the law firm of Donovan Leisure Newton & Irvine, New York,
New York for more than five years. Mr. Cox, age 55, has served as a director of
the Company since 1984.

CHARLES D. DAVIDSON -- Mr. Davidson has served as President and Chief Executive
Officer of the Company since October 2000 and has served as Chairman since April
2001. Prior to October 2000, he served as President and Chief Executive Officer
of Vastar Resources, Inc. ("Vastar") from March 1997 to September 2000 (Chairman
from April 2000) and was a Vastar Director from March 1994 to September 2000.
From September 1993 to March 1997, he served as a Senior Vice President of
Vastar. From December 1992 to October 1993, he was Senior Vice President of the
Eastern District for ARCO Oil and Gas Company. From 1988 to December 1992, he
held various positions with ARCO Alaska, Inc. Mr. Davidson, age 52, joined ARCO
in 1972.

JAMES C. DAY -- Mr. Day has served as President and Chief Executive Officer of
Noble Drilling Corporation since January 1984, and as Chairman of the Board of
Noble Drilling Corporation since October 1992. Prior to 1984, Mr. Day served as
Vice President of Noble Drilling Corporation from January 1983. Mr. Day, age 58,
is also a director of Global Industries, Ltd. He served as a director of the
Company from 1994 to 2000 and again from September 2001 to date.

DALE P. JONES -- In October 1998, Mr. Jones retired from his position as Vice
Chairman of Halliburton Company, an energy services company, a position he had
held since 1995. Mr. Jones had served in various executive and management
capacities for Halliburton for more than 30 years, including President from May
1989 to October 1995. He also served as a consultant for Halliburton from
October 2, 1998 until October 1, 2000. Mr. Jones, age 65, has served as a
director of the Company since October 1998. Mr. Jones also serves as a director
of Telsco Industries, Inc., a manufacturer of irrigation equipment.

BRUCE A. SMITH-- Mr. Smith has served as President and Chief Executive Officer
of Tesoro Petroleum Corporation since 1995 and has served as Chairman since
1996. Mr. Smith, age 57, joined Tesoro in 1992. He was elected to the Company's
Board of Directors on March 6, 2002.

PROPOSAL REGARDING AMENDMENT OF CHARTER

The Company's Board of Directors believes that it is in the Company's best
interests to change its name from Noble Affiliates, Inc. to Noble Energy, Inc.
to better describe the business in which the Company is engaged and improve its
identification in the marketplace. The new name is designed to both build upon
the tradition of the "Noble" name and to replace "Affiliates" with "Energy" in
order to reflect that the Company is involved in many aspects of the energy
business, including the exploration, production, acquisition and marketing of
hydrocarbons and the production and marketing of energy, including methanol and
power.

RECOMMENDATION AND REQUIRED AFFIRMATIVE VOTE

The affirmative vote of the holders of record of a majority of the
outstanding shares of Common Stock entitled to vote thereon is required to
approve and adopt the amendment to the Company's Certificate of Incorporation to
change the Company's name to Noble Energy, Inc. THE BOARD RECOMMENDS THAT THE
STOCKHOLDERS VOTE FOR THE PROPOSAL TO CHANGE THE COMPANY'S NAME TO NOBLE ENERGY,
INC.

SHAREHOLDER PROPOSAL

Mr. Robert Kelley, of P.O. Box 1507, Ardmore, Oklahoma 73402, owner of
1,385 shares of Common Stock, has advised the Company that he will submit the
proposal set forth below at the Annual Meeting.

SHAREHOLDER PROPOSAL (as submitted by Mr. Kelley):

The shareholders of Noble Affiliates, Inc. recommend to the Board of
Directors of Noble Affiliates, Inc. that the Board adopt a policy that the
Company shall not enter into or be a party to any personal service
contract or arrangement with any non-employee director nor shall it
utilize or provide services to any for-profit business organization in
which a Noble Affiliates, Inc. director is a partner, controlling
shareholder or executive officer except in each such case for services
that individually or in the aggregate do not exceed $5,000.00 per year for
each such non-employee director.

SHAREHOLDER'S SUPPORTING STATEMENT (as submitted by Mr. Kelley):

A director's greatest virtue is the independence which allows him or
her to challenge management decisions and evaluate corporate performance
from a completely free and objective perspective. Business arrangements,
consulting contracts or other financial agreements between the Company and
a director create a potential conflict of interest and may affect
decisions and/or proposed actions to be taken by the Board or management.

Management should be free from any perceived or real pressure created
by business relationships with directors or entities in which they
exercise control or have direct financial interests. Allowing business
relationships to exist between directors and the Company may affect
management's ability to negotiate appropriate agreements or resolve
disputes between the parties. Such business arrangements can lead to
legitimate disputes regarding the services provided which may create
dissention on the Board and between a director and management.

The Company may also be hindered by business relationships with
directors by losing competitive bids for such services by independent
third party service providers. They perceive that the business will not be
awarded to them over a director's entity and may also fear disclosure of
confidential proprietary information.

Simply stated, a director should be independent in his or her business
relationship to the Company in order to provide completely objective
advice, counsel and decision-making for the benefit of all stakeholders
in the Company.

MANAGEMENT'S STATEMENT IN OPPOSITION

The Board of Directors recommends that stockholders vote AGAINST
this proposal. This proposal, if implemented, would unnecessarily
infringe upon the Board's ability to use its business judgment in
determining whether a particular contract with a third party is in the
best interests of the Company and its stockholders. As provided under the
corporate law applicable to the Company, the business and affairs of the
Company are under the direction of the Board of Directors. As with
virtually all businesses, a significant part of the Company's business is
dependent on contracts with third parties and it is the responsibility of
the Board to establish processes to ensure that contracts which the
Company enters are in the best interests of the Company and the Company's
stockholders. In making such determination, the Company should not be
restricted from entering contracts with any party, including parties that
would be specified under the proposal.

In fact, a contract between the Company and a director, or the
Company and a business in which a director has a financial interest, is
enforceable under applicable corporate law in several instances,
including if the contract is authorized in good faith by the affirmative
vote of a majority of the disinterested directors. As a matter of
practice, the Company generally will require that material contracts with
parties affiliated with directors of the Company be approved by the
disinterested directors, thereby removing the interested parties from the
decision making process. In addition, the Company is required to provide
to its stockholders a description of any transaction to which the Company
is a party in which the amount involved exceeds $60,000 and in which a
director, director nominee, or a member of their immediate family has a
direct or indirect material interest. Thus, stockholders will be informed
of the substance of certain relationships, if any, between the Company
and each director or nominee prior to casting their votes in an election
of directors. This disclosure regarding the Company's directors is set
forth under "Certain Transactions" on page 18 of this Proxy Statement.

If the proposal were implemented, the Company would be required to
determine whether it should breach existing contractual obligations to
comply with the terms of the proposal. In addition, the Board of
Directors and management would be restrained from signing agreements with
certain businesses even if the Company enjoyed long-standing and highly
beneficial relations with such businesses, and would have to address
services rendered under existing contracts. For example, if the proposal
were implemented, the Company could be required to take action with
respect to its contracts with Noble Drilling Corporation, one of the
world's largest off-shore drilling companies, which action may not be in
the best interest of the Company. For a summary of the Company's
relationship with Noble Drilling Corporation see "Certain Transactions."

Furthermore, this proposal seeks to impose what the Board believes
to be an arbitrary and unnecessary policy that will affect director
selection. The corporate governance and nominating committee of the Board
selects as nominees only those persons who the committee believes are
well qualified to serve as directors. It weighs, on a case-by-case basis,
the potential contribution it believes a potential nominee will make to
the Company. The Board believes, as a general matter, that any proposal
that, like this proposal, seeks to impose rigid eligibility requirements
for directors is not in the best interests of the stockholders because
such requirements restrict, rather than enhance, the Company's ability to
identify the most qualified persons to serve as directors.

In conclusion, the Board believes that, the proposal, if
implemented, would unnecessarily restrict the ability of the Company's
management to conduct the business affairs of the Company in accordance
with its best judgment in order to provide protection against a perceived
problem which is presently addressed through procedural safeguards and
disclosure requirements.

RECOMMENDATION AND REQUIRED AFFIRMATIVE VOTE

The affirmative vote of the holders of record of a majority of the
outstanding shares of Common Stock present in person or represented by proxy at
the meeting and entitled to vote thereon is required to approve and ratify the
stockholder's proposal. THE BOARD RECOMMENDS THAT STOCKHOLDERS VOTE AGAINST THE
ADOPTION OF THIS STOCKHOLDER'S PROPOSAL.

INFORMATION CONCERNING THE BOARD OF DIRECTORS

The Board of Directors held ten meetings in 2001.

COMMITTEES OF THE BOARD

The committees of the Board, the current members and the primary functions
of the committees are as follows:

COMPENSATION, BENEFITS AND STOCK OPTION COMMITTEE -- T. Don Stacy,
Chairman; Edward F. Cox; James C. Day; and Dale P. Jones. The primary
responsibility of the compensation, benefits and stock option committee is
to provide direction in the areas of (i) salary and bonus compensation,
(ii) benefits, and (iii) stock options, particularly as these areas relate
to the Chief Executive Officer (CEO) and other members of senior
management. The compensation, benefits and stock option committee held
five meetings during 2001. For more details, see information herein under
"Report of the Compensation, Benefits and Stock Option Committee on
Executive Compensation."

AUDIT COMMITTEE -- Dale P. Jones, Chairman; Alan A. Baker; and Michael A.
Cawley. The primary responsibility of the audit committee is to assist the
Board of Directors in fulfilling its responsibility to oversee
management's conduct of the Company's financial reporting process and
internal control systems, including overseeing the internal audit process
and the annual independent audit of the Company's financial statements.
The audit committee held four meetings during 2001. For more details, see
information herein under "Report of the Audit Committee."

CORPORATE GOVERNANCE AND NOMINATING COMMITTEE -- Michael A. Cawley,
Chairman; Alan A. Baker; Edward F. Cox; James C. Day; Dale P. Jones; and
T. Don Stacy. The primary responsibilities of the corporate governance and
nominating committee are (i) to provide a focus on corporate governance to
enable and enhance the Company's short and long-term performance and (ii)
to engage in appropriate director selection, retention and development.
The corporate governance and nominating committee (formerly known as the
nominating committee) held five meetings during 2001. The corporate
governance and nominating committee will consider nominees of security
holders made in writing to the attention of a committee member and
delivered to the Company's principal address, provided such nomination is
timely made as provided herein.

ENVIRONMENT, HEALTH AND SAFETY COMMITTEE -- Edward F. Cox, Chairman; Alan
A. Baker; Charles D. Davidson; and T. Don Stacy. The primary
responsibility of the environment, health and safety committee is to
assist the Board of Directors in determining whether the Company has
policies and procedures in place to facilitate compliance with applicable
environment, health and safety laws. The environment, health and safety
committee held three meetings during 2001.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION. The current
members of the compensation, benefits and stock option committee were the
only persons who served on such committee during 2001. James C. Day, a
member of the compensation, benefits and stock option committee, is
currently an executive officer of Noble Drilling Corporation. Noble
Drilling Corporation provides drilling services to the Company. In 2001,
the Company paid Noble Drilling Corporation approximately $7.0 million for
drilling services. Noble Drilling Corporation's revenues were
approximately $1.0 billion for 2001.

COMPENSATION OF DIRECTORS

Directors who are not officers of the Company or any of its subsidiaries
receive an annual retainer of $28,000 and a fee of $1,000 for each Board or
committee meeting attended. The chairman of each committee, if not also an
employee or officer of the Company, receives an additional annual retainer of
$2,500. In April, 2001, the non-employee directors established the position of
"Lead Independent Director." An additional annual fee of $2,500 for the Lead
Independent Director position was set at that time. In January, 2002, the annual
fee for the Lead Independent Director position was increased to $12,000, in
light of the additional time requirements of the position. The Company also
reimburses directors for travel, lodging and related expenses they incur in
attending Board and committee meetings.

Non-employee directors are entitled to the benefit of the Company's
Non-Employee Director Fee Deferral Plan. Under the terms of this plan,
non-employee directors may, during a specified period of time each year, elect
to have all of any portion of their director fees deferred for future payment by
the Company. The deferral may be in the form of a dollar amount and/or in the
form of phantom stock.

NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN. The 1988 Nonqualified Stock
Option Plan for Non-Employee Directors, as amended, provides for the grant of
nonqualified stock options to each director of the Company who is not also
either an employee or officer of the Company. The plan provides generally for a
fixed grant of options annually on each February 1 during the term of the plan.
An automatic grant (unless revoked by the Board in a particular year) is made
(i) to each new non-employee director of an option to purchase 10,000 shares of
Common Stock and (ii) to each incumbent non-employee director of an option to
purchase 5,000 shares of Common Stock. The purchase price per share of Common
Stock under the option is fair market value on the date of grant. The options
have a ten-year term and are initially exercisable one year after date of grant.

SECURITY OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS

The following tabulation sets forth as of March 11, 2002 the shares of
Common Stock beneficially owned by each director, each named executive officer
listed in the Summary Compensation Table included elsewhere in this proxy
statement, and all directors and named executive officers as a group.

COMMON STOCK
BENEFICIALLY OWNED (1)
-------------------------------------
NUMBER PERCENT OF
NAME OF SHARES CLASS (2)
---- ----------------- ----------

Director
Alan A. Baker.................................. 27,786(3) --%
Michael A. Cawley.............................. 3,141,004(3)(4) 5.5%
Edward F. Cox.................................. 55,572(3) 0.1%
Charles D. Davidson............................ 49,167(3) 0.1%
James C. Day................................... 7,018(3) --%
Dale P. Jones.................................. 10,286(3) --%
Bruce A. Smith................................. -- --%
T. Don Stacy................................... 10,285(3) --%

Named Executive Officers (excluding
any director named above) and Group
Susan M. Cunningham............................ -- --%
Albert D. Hoppe................................ 11,668(3) --%
James L. McElvany.............................. 92,222(3) 0.2%
William A. Poillion, Jr........................ 210,248(3) 0.4%
All directors and named executive
officers as a group (12 persons)............. 3,615,256 (4)(5) 6.3%

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(1) Unless otherwise indicated, all shares are directly held with sole voting
and investment power.

(2) Less than one-tenth of one percent unless otherwise indicated.

(3) Includes shares not outstanding but subject to currently exercisable
options, as follows: Mr. Baker -- 25,786 shares; Mr. Cawley -- 31,571
shares; Mr. Cox -- 47,572 shares; Mr. Davidson -- 46,667 shares; Mr. Day
-- 6,000 shares; Mr. Jones -- 9,286 shares; Mr. Stacy -- 9,285 shares; Mr.
Hoppe -- 11,668 shares; Mr. McElvany -- 75,276 shares; Mr. Poillion --
179,121 shares.

(4) Includes 3,108,633 shares held of record by the Foundation. Under the
rules and regulations of the SEC, such shares are required to be included
in the foregoing table as "beneficially owned" because such person
possesses shared voting and investment power with respect thereto as one
of thirteen trustees of the Foundation. As with other corporate action,
the voting of the shares held by the Foundation requires a majority vote
of its trustees at a meeting at which a quorum of trustees is present.
Accordingly, such person does not represent sufficient voting power on the
Foundation's board of trustees to determine voting or investment decisions
with respect to the 3,108,633 shares. Mr. Cawley disclaims any pecuniary
interest in the 3,108,633 shares.

(5) Includes 442,232 shares not outstanding but subject to currently
exercisable options.

EXECUTIVE COMPENSATION

The following report of the compensation, benefits and stock option
committee of the Board of Directors and the information herein under
"Performance Graph" shall not be deemed to be "soliciting material" or to be
"filed" with the SEC or subject to the SEC's proxy rules, except for the
required disclosure herein, or to the liabilities of Section 18 of the
Securities Exchange Act of 1934 (the "Exchange Act"), and such information shall
not be deemed to be incorporated by reference into any filing made by the
Company under the Securities Act of 1933 or the Exchange Act.

REPORT OF THE COMPENSATION, BENEFITS
AND STOCK OPTION COMMITTEE
ON EXECUTIVE COMPENSATION

To the Stockholders
of Noble Affiliates, Inc.:

As members of the compensation, benefits and stock option committee of the
Board of Directors (the "committee"), we have responsibility for administering
the executive compensation program of the Company. All decisions by the
committee relating to the compensation of executive officers are reviewed by the
full Board.

COMPENSATION POLICIES

The executive compensation policy of the Company, which is endorsed by the
committee, is to provide a compensation program that will attract, motivate and
retain persons of high quality and will support a long-standing internal culture
of loyalty and dedication to the interests of the Company. In administering the
executive compensation program, the committee is mindful of the following
principles and guidelines, which are supported by the full Board.

Base salaries for executive officers should be competitive. A sufficient
portion of annual compensation should be at risk in order to align the interests
of executives with those of stockholders of the Company. This variable part of
annual compensation should reflect both corporate and individual performance. As
a person's level of responsibility increases, a greater portion of total
compensation should be at risk and the mix of total compensation should be
weighted more heavily in favor of stock-based compensation. The committee has
not established objective, arbitrary percentages for the mix of total
compensation that should be fixed versus at risk for any executive officers of
the Company. Stock options provide executives long-term incentive and are
beneficial in aligning the interests of executives and stockholders in the
enhancement of stockholder value.

COMPENSATION PROGRAM FOR 2001

For 2001, the executive compensation program consisted of three principal
elements, which are discussed below: base salary, an annual incentive bonus plan
and stock options that are exercisable over a ten-year period.

BASE SALARY: Base salary for executive officer positions is determined
principally by competitive factors. The Company obtains information
through participation in oil and gas industry compensation surveys
conducted by independent compensation consultants. In 2001, the Company
engaged William M. Mercer ("Mercer") to update its review of the Company's
compensation programs. Such review covered base salary, the annual
incentive bonus plan and long-term incentive plans. The committee
generally analyzes the information and makes annual adjustments based on
performance, incumbent length of service in the executive position and
cost of living. The policy of the compensation, benefits and stock option
committee generally is to establish base salary levels that approximate
survey averages. Based on the Mercer survey, adjustments were made to
certain executive officers' base salary to more closely approximate the
market averages. After the 2001 adjustments, the top five executive
salaries varied between 16 percent below and 3 percent above the market
median.

ANNUAL INCENTIVE BONUS PLAN: The annual incentive bonus plan in which
executive officers participate is available to all full-time employees of
the Company or its subsidiaries (except the 20 employees of Noble Gas
Marketing, Inc., a wholly-owned subsidiary of the Company, who are covered
under a separate bonus plan). The target bonus for an employee is the base
salary at year-end of such employee multiplied times the percentage factor
assigned to such employee's salary classification. Target percentage
factors range from 5 to 70 percent, with factors of 70 percent for the CEO
and 60 percent for the other four top paid executive officers.

Annual performance goals for the Company and its divisions are based on
four criteria as follows: cost of finding and developing new reserves; new
reserves added; annual production; and stock performance as measured
against the annual stock performance of certain peer companies. The annual
performance goals for cost of finding and developing new reserves, new
reserves added and cash flow from operations were developed by the
committee and approved by the full Board.

STOCK OPTIONS: The Company's 1992 Stock Option and Restricted Stock Plan
(the "1992 Plan") is designed to align a significant portion of the
executive compensation program with stockholder interests. The 1992 Plan,
which was approved by stockholders in 1992 and amended and restated in
1997 and 2000, permits the use of several different types of stock-based
grants or awards: nonqualified or incentive stock options with or without
stock appreciation rights and restricted stock. To date only nonqualified
stock options have been granted under the 1992 Plan.

The options represent the right to purchase shares of Common Stock over a
period of up to ten years upon such terms and conditions, consistent with
the provisions of the 1992 Plan, as are specified by the compensation,
benefits and stock option committee at the time of grant. The option price
for incentive stock options is not less than the fair market value per
share at the date of grant and for nonqualified stock options is not less
than 50 percent of fair market value per share at the date of grant.
Nonqualified stock options are not granted at a price less than fair
market value at the date of grant.

In July 1998, the Company engaged Towers Perrin, Inc. ("Towers Perrin") to
update its 1996 information in order to advise the compensation, benefits
and stock option committee as to appropriate grant guidelines. Towers
Perrin based its recommendations as to appropriate grant guidelines on an
analysis of average annual stock grants over a three-year period as
disclosed in publicly available proxy statements of ten companies it
considered comparable to the Company in business and scope. The Towers
Perrin report suggested multiples of 0.5 of base salary at the lower
levels of employees of the Company, from 1.5 to 4.4 for vice presidents of
the Company and 5.7 at the CEO level. Using the Towers Perrin report, and
adjusting its recommendations to account for changes in the Company's
stock price, the compensation, benefits and stock option committee in 2001
adopted grant multiples that ranged from 0.5 to 5.4 of base salary, with
multiples of 5.4 for the CEO and 4.4 for other executive officers.
Additionally, the Company used the 2001 Mercer survey to validate the
option grants made to the named executive officers.

The approximate number of shares granted is determined by dividing (i) the
optionee's annual base salary multiplied times the applicable grant
multiple by (ii) the fair market value per share of the underlying Common
Stock on the calculation date. The compensation, benefits and stock option
committee, in its discretion, can adjust the number of shares granted
under the 1992 Plan from the number determined under the grant guidelines.
Options granted to executive officers in 2001 were based on the guidelines
described above and the following terms and conditions: 10-year term; vest
at the rate of one-third per year commencing on the first anniversary of
the grant date; and option price equal to fair market value per share at
the grant date.

2001 COMPENSATION OF CEO

Davidson Employment Agreement. Effective October 2, 2000, the Company
entered into an employment agreement with Charles D. Davidson, for a term of
three years, with automatic successive one year extensions, unless either Mr.
Davidson or the Company gives six months written notice. Under the agreement,
Mr. Davidson receives a minimum annual salary of $475,000, plus business
expenses and other specified benefits, for serving as President and Chief
Executive Officer of the Company. In the year ended December 31, 2001, Mr.
Davidson earned an annual bonus of $551,250. The employment agreement also
provides for Mr. Davidson's participation in the

Company's benefit plans and stock option plans, with 60,000 stock options
granted to Mr. Davidson in 2001. By mutual agreement, Mr. Davidson and the
Company terminated Mr. Davidson's employment agreement and entered into a change
of control agreement on February 1, 2002.

The Company's change of control agreement with Mr. Davidson includes
provisions regarding the applicable severance package that Mr. Davidson may be
entitled to if he is terminated within 24 months after a change of control of
the Company. A change of control for purposes of Mr. Davidson's change of
control agreement will be deemed to have occurred if:

o individuals who constituted the Board of Directors at the time of Mr.
Davidson's employment (the "Incumbent Board") cease to constitute at least
51% of the Board, provided that any person whose election was approved by
a vote of at least a majority of the directors of the Incumbent Board will
be considered a member of the Incumbent Board;

o the stockholders of the Company approve a reorganization, merger or
consolidation whereby the persons who were stockholders immediately prior
to such reorganization, merger or consolidation do not immediately
thereafter, own at least 51% of the voting shares of the new entity;

o the stockholders of the Company approve a liquidation or dissolution of
the Company or a sale of all or substantially all of the Company's assets
to a non-related party; or

o a new person or entity becomes the owner of at least 25% of the
outstanding common stock or voting power in the Company.

If the Company terminates Mr. Davidson for cause, incapacity due to
physical or mental illness, or death, then the Company has no further liability.
A termination for cause may only be made by the affirmative vote of a majority
of the members of the Board of Directors of the Company.

If the Company terminates Mr. Davidson for any other reason within 24
months after a change of control of the Company, then the Company shall pay or
provide the following to Mr. Davidson:

o pay all unpaid salary, expenses, compensation and benefits;

o pay a lump sum of 2.99 times his annual cash compensation (made up of
annual salary and bonus);

o pay an amount equal to his pro-rata target bonus for the then-current
year;

o provide life, disability, medical and dental insurance benefits, upon his
written request, for 36 months or such shorter period until Mr. Davidson
obtains substantially equivalent coverage from a subsequent employer;

o preserve his Company stock options; and

o reimburse him for reasonable fees up to $15,000 for out-placement
employment services.

The above amounts will have a gross-up payment applied to them to offset
fully the effect of any federal excise tax on them.

CHANGE OF CONTROL AGREEMENTS

Each named executive officer, including Susan M. Cunningham, Albert D.
Hoppe, James L. McElvany, and William A. Poillion, Jr., has a change of control
agreement similar to Mr. Davidson's, which is described above. These change of
control agreements generally provide for substantially the same terms and
conditions as Mr. Davidson's agreement, except a different multiplier is used in
the named executive officers' agreements. This multiplier affects two provisions
of the agreement - the lump sum payment that will be made upon termination and
the provision of insurance benefits. For example, the multiplier in Mr.
Davidson's agreement is 2.99, so he will receive a lump sum of 2.99 times his
annual cash compensation and up to 36 months of benefits (2.99 times 12

months) if he is terminated under certain change of control circumstances that
are described above. The multiplier for the named executive officers (other than
Mr. Davidson) is 2.5. Thus, each named executive officer's lump sum payment is
2.5 times his or her annual cash compensation and his or her insurance benefits
may extend for up to 30 months.

PARTICIPATION IN MINERAL, ROYALTY AND OVERRIDING ROYALTY ACQUISITIONS

In addition to the executive compensation policies and programs described
above, the Company has had a policy pursuant to which officers and key employees
of the Company and Samedan have been permitted to acquire interests in minerals,
royalties and overriding royalties purchased from time to time by Samedan (or
its subsidiaries). In 2000, the Company's outside directors discontinued their
participation in the program. When this participation has been offered, usually
up to one-half of the interests acquired by Samedan (or its subsidiaries) has
been made available to be acquired by the participants in the aggregate. A
participant has been required to purchase his or her interest for cash on the
same cost basis as Samedan and has been responsible for obtaining any required
financing. In certain instances, the Company or Samedan has assisted
participants in obtaining financing from a third party lender and/or provided a
guarantee of the amount financed by a participant. This policy has applied only
with respect to mineral, royalty and overriding royalty interests acquired by
Samedan (or its subsidiaries) and has not applied to the acquisition of working
interests, even though a group of oil and gas properties acquired by Samedan (or
its subsidiaries) has included both working interests and mineral, royalty and
overriding royalty interests.

During 2001, the Board of Directors reviewed the above policy to determine
whether it continued to be an effective element of the Company's overall
compensation programs. Based on this review, the Company has decided to suspend
indefinitely any new participation in this program with the belief that the
remaining elements of the Company's compensation programs provide competitive
compensation and performance incentives for the Company's employees.

TAX DEDUCTIBILITY OF EXECUTIVE COMPENSATION

Section 162(m) of the Internal Revenue Code contains provisions that limit
the tax deductibility of executive compensation in excess of $1 million per
person per year, subject to certain exceptions. The policy of the Company is to
design its compensation programs to preserve the tax deductibility of
compensation paid to its executive officers and other members of management.
However, the compensation, benefits and stock option committee could determine,
taking into consideration the burdens of compliance with Section 162(m) and
other relevant facts and circumstances, to pay compensation that is not fully
deductible, if the committee believes such payments are in the Company's best
interest. In 1997, the stockholders of the Company approved the amended and
restated 1992 Plan, allowing compensation paid thereunder in the form of stock
options and stock appreciation rights to qualify as "performance-based
compensation" for purposes of Section 162(m).

SUMMARY

The members of the committee believe that linking executive compensation
to corporate performance results in a better alignment of compensation with
corporate goals and stockholder interests. As performance goals are met or
exceeded, resulting in increased value to stockholders, executive officers are
rewarded commensurately. The committees believe that compensation levels during
2001 adequately reflect the compensation goals and policies of the Company.

March 29, 2002 Compensation, Benefits and
Stock Option Committee

T. Don Stacy, Chairman
Edward F. Cox
James C. Day
Dale P. Jones

The following "Summary Compensation Table," "Option Grants in 2001" table,
"Aggregated Option Exercises in 2001 and 12/31/01 Option Values" table, "Pension
Plan Table," and "Performance Graph" are attachments to this Report of the
Compensation, Benefits and Stock Option Committee on Executive Compensation.

----------

The following table sets forth certain summary information concerning the
compensation awarded to, earned by or paid to the Chief Executive Officer of the
Company and each of the four most highly compensated executive officers of the
Company other than the Chief Executive Officer (collectively, the "named
executive officers") for the years indicated.

SUMMARY COMPENSATION TABLE

Long Term
Compensation
Annual Compensation Awards
----------------------------------- -------------
Other
Annual Stock All Other
Name and Compen- Options Compen-
Principal sation (number of sation
Position Year Salary ($) Bonus ($) ($) shares) (1) ($)
-------- ---- --------- --------- ------- ------------- ---------

Charles D. Davidson, 2001 495,833 551,250 3,815 60,000 31,810(2)(3)
President and Chief Executive 2000 118,892 118,400 142 80,000 400
Officer 1999 -- -- -- -- --

Susan M. Cunningham, 2001 203,846 183,645 141 20,000 219(3)
Senior Vice President - 2000 -- -- -- -- --
Exploration (4) 1999 -- -- -- -- --

Albert D. Hoppe, 2001 240,000 216,000 141 25,000 18,355(3)
Senior Vice President, 2000 23,848 23,014 -- 10,000 142
General Counsel and Secretary 1999 -- -- -- -- --

James L. McElvany, Vice 2001 216,250 202,500 1,447 25,000 33,626(3)
President, Chief Financial 2000 195,000 210,000 3,442 28,350 30,410
Officer, Treasurer and Assistant 1999 162,500 64,800 3,165 15,048 21,422
Secretary

William A. Poillion, Jr., Senior 2001 264,167 243,000 4,314 25,000 57,641(3)
Vice President - Production and 2000 252,500 260,200 3,746 28,350 55,666
Drilling and Operating 1999 245,000 88,200 3,165 31,350 42,243

----------

(1) Options represent the right to purchase shares of Common Stock at a fixed
price per share.

(2) Consists of $100 of directors' fees.

(3) Consists of contributions by the Company to a defined contribution
plan/nonqualified contribution plan and payment by the Company of term
life insurance premiums as follows: Charles D. Davidson-- $9,504 /
$22,306; $0; Susan M. Cunningham -- $0 / $0; $219; Albert D. Hoppe--
$9,600 / $7,055; $1,700; James L. McElvany-- $9,602 / $24,024; $0; William
A. Poillion, Jr.-- $9,100 / $47,791; $750.

(4) Ms. Cunningham has been employed by the Company since April 2001.

The following table sets forth certain information with respect to options
to purchase Common Stock granted during the year ended December 31, 2001 to each
of the named executive officers.

OPTION GRANTS IN 2001

Potential Realizable
Individual Grants Value at Assumed
--------------------------------------------------------- Annual Rates of
% of Total Stock Price
Number of Shares of Options Exercise Appreciation
Securities Granted to or Base for Option Term
Underlying Options Employees Price Expiration --------------------------
Name Granted(1) in 2001 ($/sh) Date 5%($)(2) 10%($)(3)
---- ------------------- ---------- -------- ---------- ------------ ------------

Charles D. Davidson 60,000 8.3% 43.21 1/29/11 1,630,472 4,131,937
Susan M. Cunningham 20,000(4) 2.8% 41.85 4/23/11 526,385(5) 1,333,962(6)
Albert D. Hoppe 25,000 3.5% 43.21 1/29/11 679,363 1,721,640
James L. McElvany 25,000 3.5% 43.21 1/29/11 679,363 1,721,640
William A. Poillion, Jr. 25,000 3.5% 43.21 1/29/11 679,363 1,721,640

----------
(1) Options represent the right to purchase shares of Common Stock at a fixed
price per share. The options vest at the rate of one-third per year
commencing on the first anniversary of the grant date.

(2) Reflects an assumed appreciated market price per share of Common Stock of
$70.38.

(3) Reflects an assumed appreciated market price per share of Common Stock of
$112.08.

(4) Initially granted upon Ms. Cunningham's employment with the Company in
April 2001.

(5) Reflects an assumed appreciated market price per share of Common Stock of
$68.17.

(6) Reflects an assumed appreciated market price per share of Common Stock of
$108.55.

The following table sets forth certain information with respect to the
exercise of options to purchase Common Stock during the year ended December 31,
2001, and the unexercised options held at December 31, 2001 and the value
thereof, by each of the named executive officers.

AGGREGATED OPTION EXERCISES IN 2001
AND 12/31/01 OPTION VALUES

Number of Securities
Underlying Unexercised
Options at Value of Unexercised
December 31, 2001 In-the-Money Options
Shares (number of shares) at December 31, 2001 ($)
Acquired Value --------------------------- ----------------------------
Name on Exercise Realized($) Exercisable Unexercisable Exercisable Unexercisable
---- ----------- ----------- ----------- ------------- ----------- -------------

Charles D. Davidson -- -- 26,667 113,333 -- --
Susan M. Cunningham -- -- -- 20,000 -- --
Albert D. Hoppe -- -- 3,334 31,666 -- --
James L. McElvany -- -- 57,201 48,916 350,176 267,623
William A. Poillion, Jr. 9,000 235,440 155,612 54,350 1,128,154 351,646

The defined benefit plans of the Company that cover its executive officers
provide the benefits shown below. The estimates assume that benefits are
received in the form of a ten-year certain and life annuity.

PENSION PLAN TABLE

Estimated Annual Benefits Upon Retirement at Age 65
After Completion of the Following Years of Service
60 Month Average ----------------------------------------------------------------------
Annual Compensation 15 20 25 30 35
------------------- --------- ---------- ---------- ---------- ----------

$ 100,000................ $ 30,000 $ 40,000 $ 40,000 $ 46,918 $ 46,918
150,000................ 45,000 60,000 60,974 73,168 73,168
200,000................ 60,000 80,000 82,849 99,418 99,418
300,000................ 90,000 120,000 126,599 151,918 151,918
400,000................ 120,000 160,000 170,349 204,418 204,418
600,000................ 180,000 240,000 257,849 309,418 309,418
800,000................ 240,000 320,000 345,349 414,418 414,418
1,000,000................ 300,000 400,000 432,849 519,418 519,418
1,300,000................ 390,000 520,000 564,099 676,918 676,918
1,400,000................ 420,000 560,000 607,849 729,418 729,418
1,500,000................ 450,000 600,000 651,599 781,918 781,918

Upon vesting, the amount of retirement benefit depends on an employee's
final average monthly compensation, age and the number of years of credited
service (maximum of 30 years). Final average monthly compensation is defined
generally to mean the participant's average monthly rate of compensation from
the Company for the 60 consecutive months prior to retirement that give the
highest average monthly rate of compensation for the participant. Compensation
covered by the defined benefit plans is defined (with certain exceptions) to
mean the compensation actually paid to a participant as reported on the
participant's federal income tax withholding statement for the applicable
calendar year. Accordingly, the amounts reported in the Summary Compensation
Table included elsewhere herein under "Annual Compensation" approximate covered
compensation for 2001. The amount of benefit shown in the above table is not
subject to any deductions for social security or any other offset amounts.

Under the Company's qualified defined benefit plan and applicable Internal
Revenue Code provisions, for 2001 compensation in excess of $170,000 cannot be
taken into account and the maximum annual annuity benefit cannot exceed
$140,000. Effective as of January 1, 2002, the amount of compensation that can
be taken into account under the Company's qualified defined benefit plan
increased to $200,000 and the maximum annual annuity benefit increased to
$160,000. The benefits that accrue in excess of these limitations are paid
pursuant to the Company's nonqualified defined benefit plan.

As of December 31, 2001, the named executive officers had the following
approximate number of years of credited service for retirement purposes: Mr.
Davidson--1; Ms. Cunningham--1; Mr. Hoppe--1; Mr. Poillion--25; and Mr.
McElvany--23.

Under the Company's nonqualified Deferred Compensation Plan, the named
executive officers are eligible to defer portions of the salary and bonus
reflected on the Summary Compensation Table above, and to receive certain
matching contributions that would have been made to the Company's qualified
401(k) plan if such plan had not been subject to Internal Revenue Code
compensation and contribution limitations. The matching contributions and
interest earnings credited to the Deferred Compensation Plan accounts of the
named executive officers are reflected in the All Other Compensation column of
the Summary Compensation Table above.

The following graph sets forth the cumulative total stockholder return for
the Common Stock, the S&P 500 Index and the Dow Jones Total Return Index for
Secondary Oil Companies for the years indicated as prescribed by the SEC's
rules.

PERFORMANCE GRAPH

COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN (1)
AMONG NOBLE AFFILIATES, INC., S&P 500 INDEX
AND DOW JONES TOTAL RETURN INDEX FOR
SECONDARY OIL COMPANIES (2)

[GRAPH]

1996 1997 1998 1999 2000 2001
---- ---- ---- ---- ---- ----

Company 100 74 52 45 98 76

S&P 500 Index 100 133 171 208 189 166

Dow Jones Total Return Index for Secondary 100 100 68 79 126 116
Oil Companies (2)

(1) Total return assuming reinvestment of dividends. Assumes $100 invested on
December 31, 1996 in Common Stock, the S&P 500 Index and the Dow Jones
Total Return Index for Secondary Oil Companies.

(2) Composed of the following companies: Amerada Hess Corporation, Anadarko
Petroleum Corporation, Apache Corporation, Ashland, Inc., Burlington
Resources Inc., Cabot Oil and Gas, Chesapeake Energy, Devon Energy
Corporation, E.O.G. Resources, Evergreen Resources, Forest Oil, Kerr-McGee
Corporation, Meridian Energy, Murphy Oil Corporation, Newfield
Exploration, Noble Affiliates, Inc., Ocean Energy, Occidental Petroleum
Corporation, Pioneer Natural Resources Co., Pogo Producing Co., Stone
Energy Corporation, Sunoco Inc., Tosco Petroleum Corp., Tom Brown Inc.,
Vintage Petroleum, Inc. and XTO Energy Inc.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Exchange Act requires directors and officers of the
Company, and persons who beneficially own more than 10 percent of the Common
Stock, to file with the SEC initial reports of ownership and reports of changes
in ownership of the Common Stock. Directors, officers and more than 10 percent
stockholders are required by SEC regulations to furnish the Company with copies
of all Section 16(a) forms they file.

To the Company's knowledge, based solely on a review of the copies of such
reports furnished to the Company and written representations that no other
reports were required, all Section 16(a) filing requirements applicable to its
directors, officers and more than 10 percent beneficial owners were complied
with during the year ended December 31, 2001.

CERTAIN TRANSACTIONS

James C. Day, a director of the Company, is currently an executive officer
of Noble Drilling Corporation. Noble Drilling Corporation provides drilling
services to the Company pursuant to contractual agreements. In 2001, the Company
paid Noble Drilling Corporation approximately $7.0 million for drilling
services. Noble Drilling Corporation's revenues were approximately $1.0 billion
for 2001.

INDEPENDENT ACCOUNTANTS

The audit committee has not yet recommended the appointment of the
independent accountants to audit the financial statements of the Company for the
full year ending December 31, 2002, although the audit committee has recommended
and the Board of Directors has approved the appointment of Arthur Andersen LLP
to audit the Company's first quarter financial statements for 2002. The next
regularly scheduled meeting of the audit committee is during the week of April
22, 2002, at which time it is anticipated that the audit committee will discuss
and consider its recommendation for the appointment of the Company's independent
accountants for 2002. The appointment of independent accountants for 2002 is
subject to ratification by the Board of Directors and will not be submitted to
the shareholders for ratification or approval.

Representatives of Arthur Andersen LLP are expected to be present at the
meeting to respond to appropriate questions from stockholders related to the
2001 audited financial statements of the Company and will be given the
opportunity to make a statement at the meeting should they desire to do so.
Arthur Andersen LLP served as the Company's independent accountants in 2001 and
has served in this capacity since 1989.

For additional information regarding the rendering of other services by
Arthur Andersen LLP and related fees, see the "Report of the Audit Committee,"
below.

REPORT OF THE
AUDIT COMMITTEE

To the Stockholders
of Noble Affiliates, Inc.:

The Audit Committee of the Board of Directors is responsible for helping
to ensure the reliability of the Company's financial statements. In keeping with
this goal, the Board of Directors has adopted a written charter for the Audit
Committee to follow. Pursuant to Section 303.02(C) of the listing standards of
the NYSE, the Audit Committee has completed its annual review of the charter and
has chosen to republish the charter as Exhibit A to this proxy statement. While
no substantive changes to the charter have been made, a few immaterial phrases
were inadvertently omitted from the charter that was attached to last year's
proxy statement.

One of the three members of the Audit Committee of the Board of Directors,
Alan A. Baker, has no relationship with the Company that would affect his
independence (as independence is defined in Sections 303.01(B)(2)(a) and (3) of
the listing standards of the NYSE). Until October 2000, Dale P. Jones was a
consultant to Halliburton Company, one of the Company's vendors. Michael A.
Cawley is the President and Chief Executive Officer of The Samuel Roberts Noble
Foundation, Inc., a not-for profit corporation that owns shares of the Company.
The Board of Directors has determined that these relationships do not interfere
with either director's exercise of independent judgment.

REVIEW AND DISCUSSIONS

The Audit Committee has reviewed and discussed the Company's audited
financial statements with management. It has also discussed with the independent
auditors the matters required to be discussed by SAS 61 and SAS 90 (Codification
of Statements on Auditing Standards, AU Section 380). Additionally, the Audit
Committee has received the written disclosures and the letter from the
independent accountants at Arthur Andersen LLP, as required by Independent
Standards Board Standard No. 1 (Independence Discussions with Audit Committees)
and has discussed with the independent accountants their independence.

In an effort to maintain the accountants' independence, the Audit
Committee has considered whether Arthur Andersen LLP's rendering of non-audit
services is compatible with maintaining its independence. The Audit Committee
has concluded that the rendering of both types of services does not result in a
conflict.

FEES PAID TO THE INDEPENDENT PUBLIC ACCOUNTANT FOR FISCAL YEAR 2001

Audit Fees. Arthur Andersen LLP billed the Company $248,000 for
professional services rendered for the audit of the Company's annual financial
statements and the reviews of the financial statements included in the Company's
Forms 10-Q during the fiscal year ended December 31, 2001.

Financial Information Systems Design and Implementation Fees. Arthur
Andersen LLP did not render any services related to financial information
systems design and implementation for the fiscal year ended December 31, 2001.

All Other Fees. The aggregate fees billed for services rendered by Arthur
Andersen LLP during the fiscal year ended December 31, 2001, other than the
services covered above, were $338,100. Included in the $338,100 are tax
compliance and consultation fees of $127,500, $174,100 of audit-related fees,
and $36,500 of other fees. The audit-related fees primarily include foreign
statutory audits.

RECOMMENDATION TO INCLUDE AUDITED FINANCIAL STATEMENTS IN ANNUAL REPORT

Based on the Audit Committee's discussions with management and the
independent accountants, and its review of the representations of management and
the report of the independent accountants to the Audit Committee, the Audit
Committee recommended that the Board of Directors include the audited
consolidated financial statements in the Company's Annual Report on Form 10-K
for the year ended December 31, 2001 filed with the Securities and Exchange
Commission.

March 29, 2002 Audit Committee

Dale P. Jones, Chairman
Alan A. Baker
Michael A. Cawley

----------

STOCKHOLDER PROPOSALS AND OTHER MATTERS

Stockholder proposals intended to be brought before the annual meeting of
stockholders as an agenda item or to be included in the Company's proxy
statement relating to the 2003 annual meeting of stockholders, which is
currently scheduled to be held on April 22, 2003, must be received by the
Company at its office in Houston, Texas, addressed to the Secretary of the
Company, no later than November 29, 2002.

The cost of solicitation of proxies will be borne by the Company.
Solicitation may be made by mail, personal interview, telephone or telegraph by
officers and regular employees of the Company, who will receive no additional
compensation therefor. To aid in the solicitation of proxies, the Company has
employed the firm of Georgeson & Co., Inc., which will receive a fee of
approximately $7,500 plus out-of-pocket expenses. The Company will bear the
reasonable expenses incurred by banks, brokerage firms, custodians, nominees and
fiduciaries in forwarding proxy material to beneficial owners.

The Board of Directors does not intend to present any other matter at the
meeting and knows of no other matters that will be presented. However, if any
other matter comes before the meeting, the persons named in the enclosed proxy
intend to vote thereon in accordance with their best judgment.

Houston, Texas NOBLE AFFILIATES, INC.
March 29, 2002

James L. McElvany
Vice President-Finance and Treasurer

EXHIBIT A

NOBLE AFFILIATES, INC.

AUDIT COMMITTEE CHARTER

The Audit Committee ("the Committee") of the Board of Directors ("the Board") of
Noble Affiliates, Inc. ("the Company") will have the oversight responsibility,
authority and specific duties as described below.

COMPOSITION

The Committee will be comprised of three or more directors as determined
by the Board. The members of the Committee will meet the independence and
experience requirements required by law and regulation. The members of the
Committee will be elected annually at the organizational meeting of the full
Board held in conjunction with the annual shareholders meeting, and will be
listed in the annual report to shareholders.

RESPONSIBILITY

The primary purpose of the Committee is to assist the Board in fulfilling
its responsibility to oversee management's conduct of the Company's financial
reporting process and internal control systems, including overseeing the
internal audit process and the annual independent audit of the Company's
financial statements.

In discharging its oversight role, the Committee is empowered to
investigate any matter brought to its attention with full access to all books,
records, facilities and personnel of the Company and to retain outside counsel,
auditors or other experts for this purpose. The Board and the Committee are in
place to represent the Company's shareholders; accordingly, the outside auditor
is ultimately accountable to the Board and the Committee.

While the Audit Committee has the responsibilities and powers set forth in
this Charter, it is not the duty of the Audit Committee to plan or conduct
audits or to determine that the Company's financial statements are complete,
accurate and/or in accordance with generally accepted accounting principles;
this is the responsibility of management and the independent auditor. Nor is it
the duty of the Audit Committee to conduct investigations, to resolve
disagreements, if any, between management and the independent auditor or to
assure compliance with laws and regulations and the Company's business conduct
guidelines.

AUTHORITY

The Committee is granted the authority to investigate any matter or
activity involving financial accounting and financial reporting, as well as the
internal controls of the Company. In this regard, the Committee will have the
authority to approve the retention of external professionals to render advice
and counsel in such matters. All employees will be directed to cooperate with
respect thereto as requested by members of the Committee.

MEETINGS

The Committee will meet at least four times annually and as many
additional times as the Committee deems necessary. The Committee will meet in
separate executive sessions at least annually with the chief financial officer,
the director of the internal auditing department, and the independent
accountants to discuss any matters that the Committee or each of these groups
believe should be discussed. The Committee chair shall approve contents of the
agenda for each meeting.

ATTENDANCE

Committee members will strive to be present at all meetings. As necessary
or desirable, any member of the Committee may request that members of management
and representatives of the independent accountants and/or internal auditors be
present at Committee meetings.

SPECIFIC DUTIES

In carrying out its oversight responsibilities, the Committee will:

1. Review and reassess the adequacy of this Charter annually and recommend
any proposed changes to the Board for approval; this should be done in
compliance with applicable legal and regulatory audit committee requirements.

2. Review with the Company's management, the director of the internal
auditing department, and independent accountants the Company's general
accounting and financial reporting controls, and obtain annually in writing from
the independent accountants their letter as to the adequacy of such controls.

3. Review the internal auditing plans and receive summary reports of major
findings by internal auditors and how management is addressing the conditions
reported.

4. Review the scope and general extent of the independent accountants'
annual audit. The Committee will review annually with management the fee
arrangement with the independent accountants.

5. Inquire as to, and oversee, the independence of the independent
accountants and obtain from the independent accountants, at least annually, a
formal written statement delineating all relationships between the independent
accountants and the Company as contemplated by Independence Standards Board
Standard No. 1, Independence Discussions with Audit Committees.

6. At the completion of the annual audit, review with management and the
independent accountants the following:

- The annual financial statements and related footnotes and
financial information to be included in the Company's annual report
to shareholders and on Form 10-K.

- Results of the audit of the financial statements and the related
report thereon and, if applicable, a report on changes during the
year in accounting principles and their application.

- Significant changes to the audit plan, if any, and any serious
disputes or difficulties with management encountered during the
audit.

- Other communications as required to be communicated by the
independent accountants by Statement of Auditing Standards (SAS) 61
as amended by SAS 90 relating to the conduct of the audit. Further
receive a written communication provided by the independent
accountants concerning their judgment about the quality of the
Company's accounting principles, as outlined in SAS 61 as amended by
SAS 90, and that they concur with management's representation
concerning audit adjustments.

7. After preparation by management and review by the independent
accountants, approve the report required under SEC rules to be included in the
Company's annual proxy statement. The charter is to be published as an appendix
to the proxy statement every three years.

8. Recommend to the Board the selection, retention or termination of the
Company's independent accountants.

9. As the Committee may deem appropriate, obtain, weigh, and consider
expert advice as to the Committee, related rules of any governing body, and
other accounting, legal and regulatory provisions.

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NOBLE AFFILIATES, INC.

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

I have received the Notice of Annual Meeting of Stockholders to be held on April 23, 2002, and a Proxy Statement furnished
by the Board of Directors of Noble Affiliates, Inc. (the "Company") for the Meeting. I appoint Charles D. Davidson and James L.
McElvany, and each of them, as proxies with power of substitution in each, to represent me and to vote all the shares of common
stock of the Company that I am entitled to vote at the Annual Meeting on April 23, 2002 in the manner shown on this form as to the
following matters and in their discretion on any other matters that come before the meeting.

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The Company's Board of Directors recommends a vote FOR proposal 1, with no exceptions.
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1. Election of Directors

FOR ALL NOMINEES WITH FOR ALL NOMINEES WITH WITHHOLD AUTHORITY
NO EXCEPTIONS [ ] EXCEPTIONS NOTED [ ] FOR ALL NOMINEES [ ]

Michael A. Cawley, Edward F. Cox, Charles D. Davidson, James C. Day, Dale P. Jones, Bruce A. Smith

(Instruction: To withhold authority to vote for any individual nominee, write that nominee's name in the space provided below.)

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The Company's Board of Directors recommends a vote FOR proposal 2.
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2. Proposal to amend the Certificate of Incorporation of the Company, in order to change the name of the Company to Noble
Energy, Inc.:

[ ] FOR [ ] AGAINST [ ] ABSTAIN

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The Company's Board of Directors recommends a vote AGAINST proposal 3.
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3. Shareholder proposal to prohibit the Company from entering into certain contracts and agreements with non-employee
directors of the Company or with entities in which such a director is a partner, controlling shareholder or executive
officer:

[ ] FOR [ ] AGAINST [ ] ABSTAIN

4. In their discretion, the proxies are authorized to vote upon such other business or matters as may properly come before the
meeting or any adjournment thereof.

(Continued and to be signed on reverse side)

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THE PROXY HOLDERS CANNOT VOTE YOUR SHARES UNLESS YOU SIGN AND RETURN THIS CARD. IF THIS PROXY IS SIGNED AND RETURNED, IT WILL BE
VOTED IN ACCORDANCE WITH YOUR INSTRUCTIONS. YOU ARE ENCOURAGED TO SPECIFY YOUR CHOICES BY MARKING THE APPROPRIATE BOXES ON THE
REVERSE SIDE, BUT IF YOU DO NOT SPECIFY HOW THE PROXY SHOULD BE VOTED, IT WILL BE VOTED "FOR" PROPOSAL 1 (WITH NO EXCEPTIONS), "FOR"
PROPOSAL 2, AND "AGAINST" PROPOSAL 3.

I hereby revoke any proxy or proxies previously given to represent or vote the
shares of common stock of the Company that I am entitled to vote, and I ratify and
confirm all actions that the proxies, their substitutes, or any of them, may
lawfully take in accordance with the terms of this proxy card.

Dated: , 2002
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Signature(s) of Stockholder(s)

Please sign this proxy as your name(s) appears
above. Joint owners should both sign. If signed as
attorney, executor, guardian or in some other
representative capacity, or as officer of a
corporation, please indicate your capacity or title.

PLEASE COMPLETE, DATE AND SIGN THIS PROXY AND RETURN
IT PROMPTLY IN THE ENCLOSED ENVELOPE, WHICH REQUIRES
NO POSTAGE IF MAILED IN THE UNITED STATES.