Where the Boat Leaves From - How Much More Crude Export Capacity Does the U.S. Really Need?

Crude oil exports out of the U.S. are the topic du jour these days. At the heart of the discussion are the who, what, where and when of how the export capacity will be developed. Who is going to build the next crude oil export terminal, what type will it be (offshore or onshore), where are they going to put it (Corpus, Houston, Louisiana ­­— the list goes on), and when will that new capacity be available? Everyone seems to have a different answer, and for good reason. Crude oil export terminals aren’t easy to develop, any way you look at them. Today, we examine the financial and logistical hurdles that export terminals must clear in order to reach a final investment decision, and what those obstacles mean for what kind of terminal gets built, where it gets built, who builds it and how soon.

U.S. natural gas supply continues to set all-time records, and strong production growth is expected to continue. Most of these supply gains will come from the Northeast, where another round of pipeline capacity additions are being completed. But despite all this incremental gas output, a combination of cold weather last winter and hot weather this summer means that U.S. gas storage inventories are likely to end the fall season at their lowest levels since 2005. And even this comparison understates how low inventories are — gas consumption has grown dramatically in the past 10 years, and storage inventories are at all-time lows when considered in terms of the number of days of average consumption. Today, we begin a series on the implications of historically low gas storage inventories, including what the gas market might look like if this winter turns out to be colder than normal.

The buzz and activity around renewable diesel (RD), a chemically identical “drop-in” replacement for traditional petroleum-based diesel, continues to grow. The goals with RD, which is produced from renewable feedstocks, are to reduce the need for petroleum and to lower life-cycle greenhouse gas (GHG) emissions — critical steps in meeting climate agendas in many countries. Canada recently enacted legislation designed to promote the domestic production of RD as part of a broader emissions-reduction strategy. In today’s RBN blog, we take a tour of the newly emerging RD production sector in Canada and examine whether it could one day replace imports from the U.S.