In the far western reaches of the Permian Basin lies Orla, TX — a town steeped in history and significance. Orla, which can be fittingly translated into “border” in Spanish, is about 40 miles north of Pecos, near the New Mexico border in Reeves County. Founded in 1890 as a section house for the Pecos Valley Railroad, Orla evolved from a modest stop along the tracks to a bustling oil supply hub — not your typical hub with lots of tank farms close together but still a heavy throughput area — by the 1960s. Though often considered a ghost town today, with a population thought to be in the single digits, Orla remains a vital player in the oil industry. As the origin region for several major takeaway pipelines in the Permian, this once-thriving community continues to serve as a crucial link in the region’s vast network of oil exploration, extraction and transportation, particularly along heavily traveled U.S. Highway 285. In today’s RBN blog, we look at the role that Orla plays in crude oil takeaway from the prolific Permian Basin.
Figure 1. Permian Crude Oil Pipelines. Source: RBN Crude Oil Permian
So how does Orla (dashed red circle in Figure 1 above) fit into the broader landscape of Permian oil takeaway capacity? Orla, the Permian’s westernmost crude oil hub, is “where it all begins” — that is, the boundary for Permian crude production and where a few long-haul pipelines originate. (Permian production will be a major theme at RBN’s upcoming NACON conference, to be held Thursday, October 24, at the Royal Sonesta Hotel in Houston. Click here for details.)
Most associate the Permian Basin with West Texas Intermediate (WTI), which has an API gravity between 38 and 44 degrees (light blue dots in Figure 2 below). This quality is concentrated in the Midland and southern Delaware basins. But to say that Permian crude oil quality varies is an understatement at best — it varies widely from one part to the next. There are several important aspects to crude quality but the most commonly discussed are API gravity, or API for short (light versus heavy), and its sulfur content (sweet versus sour). A high API number represents “lighter” oil types with lower densities while a low API number indicates denser, or “heavier” crude. “Sweet” crude has low sulfur content (typically below 0.5%) while sour crude has higher sulfur content. (For more on crude quality, see The Weight.)
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