Trouble in the Bayou — Crescent Midstream’s Oil Spill Impacts Louisiana Oil Market

An oil spill of approximately 820 bbl occurred at a Cresent Midstream pump station in Raceland, LA, about three weeks ago. The oil leaked into a stormwater canal, eventually reaching the Bayou Lafourche. The affected area stretches from the Highway 182 Bridge to the Highway 90 Bridge, covering the entire length of Raceland.

Physical prices of Heavy Louisiana Sweet (HLS), a medium sweet oil, have mostly traded at a premium to Nymex WTI since the spill (see red dashed oval in chart below). HLS is primarily used by local refineries and is occasionally exported.

Crescent Midstream operates more than 1,200 miles of oil pipelines, serving more than 80 deepwater platforms and connecting to liquid trading and receipt points onshore Louisiana. The company’s Raceland pump station serves its Bonefish pipeline and Sentinel Midstream’s Southline pipeline. It’s our understanding that as of now, Crescent’s Raceland pump station remains shut down.