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.
The NATGAS Production Tracker - Texas provides a DAILY update of natural gas production in Texas the New Mexico side of the Permian Basin. Quickly and easily view today’s supplies in the Lone Star state and download the full historical table when you need it.
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).
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About the song
“Corpus Christi Bay” was written by Robert Earl Keen and appears as the ninth song of Robert Earl Keen’s fourth studio album, A Bigger Piece of the Sky. The song tells the story of two brothers working the oil rigs of Corpus Christi Bay and the adventures they encounter. The line from the song: “That life is contagious, and it gets down in your blood,” presents a credo of the oil rig worker. Personnel on the record were: Robert Earl Keen (lead vocal, acoustic guitar), George Marinelli (electric guitar), Tommy Spurlock (acoustic guitar, gut string guitar, steel guitar, lap steel), Gerry Tallent (bass), and Dave Durocher (drums, percussion, backing vocals).
A Bigger Piece of the Sky was recorded at The Board Room in Nashville during July 1992. Produced by Garry Velletri, it was released on Sugar Hill Records in October 1993. Many consider it Keen’s best album, bringing together a variety of Americana alternative country styles rooted in Texas music. The album was re-released on Koch Records in August 2004.
Robert Earl Keen is an American singer, songwriter and guitarist from Houston. He spent his teenage years following his sister Kathy around downtown Houston bars as she participated in foosball tournaments. As Kathy would hustle the locals and win championships, Keen would have the opportunity to check out the local live music talent in Houston bars. He soon started playing guitar while going to school at Texas A&M in College Station, TX. It was at Texas A&M that he met fellow student and musician Lyle Lovett, and the die was cast for Keen’s pursuit of a career in music after graduation. After relocating to Austin, he started honing his chops and paying his dues in the bars around the area. Keen spent $4,500 of his own money financing his first album, No Kinda Dancer, released in 1984. Writing songs in the storytelling tradition of fellow Texas songwriters Townes Van Zandt, Guy Clark and Joe Ely, his career started taking off with the 1989 release of West Textures, which contained his now-popular song, “The Road Goes on Forever.” He has released 12 studio albums, seven live albums, one compilation album, and 17 singles. His songs have been covered by such artists as George Strait, Lyle Lovett, Nancy Griffith, and the Dixie Chicks. He continues to tour and has three Texas dates scheduled for May. Keen hosts the Americana Podcast.
Comments
Interesting that Port of Corpus Christi eventually wants to dredge channel to 74 feet to accommodate VLCC's in the inner harbor. I doubt it will ever happen, even if they build the new bridge and dredge the channel, they still have the problem of turning the ships around. The channel is very narrow and with new business filling in the few blank spots on the channel, there is no room to exapnd it.
The better idea would be Magellans suggestion of an offshore port.
In reply to Corpus by Greg Sheldon
Great article!
Offshore port would work best, but that's expensive, too. And the last time that was suggested, it drew major fire from environmental groups. A crude terminal on Harbor Island, like at the old McDermott yard (now operated by Gulf Copper), with its ready-made harbor, might be the best of both worlds. Harbor Island is where crude first came and went from that part of the coast.