A must-know overview of Occidental’s key growth projects

A must-know overview of Occidental’s key growth projects

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Oct. 16 2014, Updated 9:00 a.m. ET

BridgeTex pipeline

The BridgeTex pipeline is a joint venture with Magellan Midstream Partners (MMP). The 450-mile pipeline will have the capacity to transport ~300,000 barrels per day of crude oil from the Permian region to the Gulf Coast refineries.

The project also includes construction of ~2.6 million barrels of oil storage. The project is scheduled to come online in 3Q14.

The Al Hosn gas project

In 2011, Occidental acquired a 40% participating interest in the Al Hosn gas project in Abu Dhabi, joining with the Abu Dhabi National Oil Company in a 30-year joint venture agreement.

Once it comes online, OXY anticipates the project will produce over 500 million cubic feet per day of natural gas, of which Occidental’s net share would be over 200 million cubic feet per day.

Plus, the project is expected to produce over 50,000 barrels per day of natural gas liquids and condensate, of which Occidental’s net share would be over 20,000 barrels per day.

The total project cost is approximately $10 billion, and OXY’s share would be $4 billion. OXY expects the project’s production to begin in 4Q14.

OxyChem Ingleside ethylene cracker

OXY has entered into a 50/50 joint venture agreement with Mexichem to build an ethylene cracker at the OxyChem plant in Ingleside, Texas.

The ethane steam cracking unit will be capable of producing 1.2 billion pounds of ethylene per year, which is expected to begin operating in 2017.

Occidental will use the ethylene produced from the cracker to produce vinyl chloride monomer (or VCM), and Mexichem has already contracted with OXY to purchase the substantial majority.

Key ETFs

OXY is a component of several key ETFs, including the Energy Select Sector SPDR Fund (XLE), Vanguard Energy ETF (VDE), iShares U.S. Energy ETF (IYE), and SPDR S&P Oil & Gas Exploration & Production ETF (XOP).

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