Occidental's strong financial performance has built upon strategic transactions that transformed the company and established it in the industry. We continually manage our asset portfolio with an eye toward adding value through new acquisitions or, as we deem appropriate, through divestment.
Our stable, low-risk projects in the U.S., and development opportunities in the Middle East region and Latin America yield strong production growth and are expected to generate high returns on capital employed. For capital planning purposes, we require that proposed investments meet stringent return expectations: 15 percent or more for domestic projects and 20 percent or more for international projects. Our capital allocation philosophy is driven by the goal of creating long-term value for our stockholders.
Since 2013, Occidental has strategically divested of lower-margin, lower-return oil and gas production, and replaced it with higher-margin, higher-return production from our Permian Resources business.
Sale of non-core domestic midstream assets: Occidental closed on the sale of non-core domestic midstream assets including Centurion Pipeline L.P. common carrier oil pipeline and storage system, the Southeast New Mexico oil gathering system and the Ingleside Crude Terminal. Occidental kept its long-term flow assurance, pipeline takeaway and export capacity through its retained marketing business.
Acquisition of Seminole-San Andres Unit Properties/Monetization of Non-Strategic Permian Resources Acreage: Occidental completed a number of purchase and sale transactions in the Permian Basin that enhanced the value of both the company’s Enhanced Oil Recovery (EOR) and Permian Resources businesses.
Purchase of Seminole-San Andres EOR properties: The transaction included the acquisition of working interests in the Seminole-San Andres Unit, a premier CO2 flood; interests in the Seminole Gas Processing Plant; source fields at Bravo Dome Unit and West Bravo Dome Unit; and the Sheep Mountain and Rosebud CO2 pipelines. Occidental has increased ownership interest in these EOR assets since 2000. With this acquisition, the Seminole-San Andres Unit became Occidental’s largest operated, domestic oil-producing EOR unit.
Monetization of non-strategic Permian Resources acreage: Occidental concurrently completed transactions to divest a combined 13,000 net acres of non-strategic acreage in Pecos, Andrews and Martin Counties, while adding incremental acreage to enhance a future core development area in Glasscock County.
Sale of South Texas Operations: Occidental divested its non-core South Texas gas properties.
Ingleside Ethylene cracker: OxyChem and Mexichem began operations at their joint venture ethylene cracker in Ingleside, Texas. The cracker, which is operated by OxyChem, has the capacity to produce 1.2 billion pounds of ethylene per year and provides OxyChem with an ongoing source of ethylene for manufacturing vinyl chloride monomer, which Mexichem will use to produce polyvinyl chloride (PVC resin) and PVC piping systems. The companies have a 20-year supply agreement.
4CPe: OxyChem completed construction on the previously announced expansion of its manufacturing plant in Geismar, Louisiana, on budget and on time. In December 2017, the new facility began producing 4CPe, a new raw material used in making next-generation, climate-friendly refrigerants with a low global-warming and zero ozone-depletion potential.
Acquisition of Permian Basin Resources Properties: Occidental increased its working interests in 35,000 net acres of producing and non-producing leasehold in Reeves and Pecos Counties in the Permian Basin.
Acquisition of Permian EOR Properties: Occidental acquired additional working interests in several EOR properties where Occidental was already an owner or operator, including interests in Seminole-San Andres. These properties included roughly 4,000 boepd of production.
Sale of Eagle Ford Properties: Occidental divested largely non-operated Eagle Ford properties located in South Central Texas.
Oil Export Terminal Opens: The Oxy Ingleside Energy Center (OIEC) Terminal, located at the Port of Corpus Christi in Ingleside, Texas, began exporting crude oil in October 2016. The crude oil storage and export facility provides access to international and domestic markets.
Adnoc Sour Gas (Al Hosn Gas): In January, a joint venture between Occidental and Abu Dhabi National Oil Company (ADNOC) announced that production had begun at the Al Hosn Gas Project in the United Arab Emirates. The 30-year joint venture was formed to develop the Shah Field, one of the largest gas fields in the Middle East.
Non-core Operations: Occidental minimized or ceased its involvement in non-core operations in the Middle East and North Africa, including Bahrain, Iraq, Libya and Yemen. The company also sold its interest in the Williston Basin of North Dakota and agreed to sell its Piceance Basin operations in Colorado. The Piceance sale closed in 2016.
Spin-off of California Operations: In November, Occidental completed the spin-off of its California oil and gas business into an independent, publicly-traded company, California Resources Corporation.
Pipelines: In September, Occidental's Centurion Pipeline unit expanded its Permian Basin oil pipeline infrastructure with the activation of the Cline Shale pipeline.
In November, Occidental sold a portion of its investment in the General Partner of Plains All-American Pipeline, L.P., and its interest in the BridgeTex pipeline, while retaining long-term, cost-advantaged shipping commitments on BridgeTex, which extends from the Permian Basin to the Houston-Gulf Coast area.
Chlor-alkali Plant in New Johnsonville, Tennessee: In March, OxyChem completed construction and began operating its membrane cell chlor-alkali plant in New Johnsonville, Tennessee.
Sale of Hugoton Field Assets: Occidental completed the divestment of its non-core Hugton Field assets.