Corpus Christi, TX, is quickly becoming a strategic hub for U.S. crude oil exports. Since the repeal of the crude oil export ban in December 2015, crude exports from the Sparkling City by the Sea have increased to nearly 500 Mb/d — and that may be just the beginning. Numerous pipeline and terminal projects have been announced to receive, store and ship out a lot more crude from the Permian and Eagle Ford shale plays, with an increasing share of those barrels destined for the international market. Today, we discuss recent developments in crude exports out of South Texas.
RBN has written often about crude oil pipelines to Corpus Christi and refineries, storage and ship docks in Corpus and nearby Ingleside. They were covered in a Drill Down Report and, most recently in the “Take It to the Limit” blog series last spring. Part 1 of that series discussed the facts that Permian production is rising fast, and that a significant share of the new pipelines being developed to accommodate Permian growth would flow to the South Texas coast. RBN’s Growth Scenario shows Permian crude oil production rising by about 300 Mb/d a year through the early 2020s — topping 3 MMb/d late this year, 4 MMb/d in late 2020 and pushing 5 MMb/d by 2023. Further, recent increases in oil prices could accelerate the pace of that growth, not just in the Permian but in the recently rebounding Eagle Ford, where production now averages more than 1.3 MMb/d. Part 2 described extensive crude-related infrastructure already in place in Corpus; Part 3 recounted recent increases in exports out of Corpus-area docks, including Occidental Petroleum’s (Oxy) new Ingleside Energy Center Terminal in Ingleside (across the bay from Corpus); and Part 4 described a few of the projects under way to increase Corpus’s capacity for shipping out more and more crude.
A lot has happened in the past few months since that series was written. Before we get to that, let’s recap some of what’s already there. First, Corpus Christi is home to three refineries and two condensate splitters (simple refineries) with a combined capacity of 795 Mb/d. According to Baker & O’Brien estimates, these refineries can process about 550 Mb/d of domestic light crude oil and condensate. Remember that these refineries were built before domestic light crude oil was in surplus and that their configurations don’t support 100% light crude oil processing. Since the refineries can only handle some of the light crude and condensate that flows to Corpus from the Eagle Ford (on a number of pipelines with capacities totaling about 1.8 MMb/d) or from the Permian on Plains All American’s 390-Mb/d Cactus Pipeline (which currently feeds into the Eagle Ford JV pipeline to get to Corpus Christi), the balance needs to be sent out of the port on ships, either Jones Act vessels to other U.S. destinations or on ships bound for export markets. Figure 1 shows that the total volumes being shipped out of the Port of Corpus Christi have been rising over the past two years, and that an increasing share of those volumes are exports (blue bar segments).