Out of Sight - The Latest on Gulf Coast Crude Export Capacity Expansions

When fully loaded, a Very Large Crude Carrier (VLCC) sits so low in the water that it almost resembles an alligator swimming along the surface of a lagoon. Bearing the weight of 2 MMbbl of crude oil, plus ballast, fuel, crew, and provisions — not to mention the ship itself — two-thirds of an oil-laden VLCC is literally out of sight. You could say the same about the development of crude export terminal projects along the Gulf Coast: not much to see, maybe, especially during the disturbingly enduring COVID-19 era, but a lot is happening under the surface. In today’s blog, we discuss the status of onshore and offshore projects aimed at streamlining the shipment of U.S. crude oil to overseas buyers.

Considering all that’s been going in the world — and in the oil-and-gas part of it — over the past year and a half, U.S. crude oil exports have fared pretty well. While the pandemic and COVID-related lockdowns crushed demand for refined products and spurred a quick rollback in crude oil production in the spring of 2020, oil exports out of Gulf Coast terminals held relatively steady through the balance of last year and the first eight months of 2021. According to RBN’s weekly Crude Voyager report, terminals in Texas and Louisiana exported a record 1.1 billion bbl of crude in 2020, an average of just over 3 MMb/d and almost 0.5 MMb/d more than in 2019 (stacked colored bars in Figure 1). So far in 2021, export volumes have been near 3 MMb/d every month except February, when the Deep Freeze shut in a lot of Permian production, disrupted Texas pipeline flows, and trimmed exports to only 2.3 MMb/d.

Throughout 2020-21, Corpus Christi-area terminals have continued to account for the largest share of U.S. crude oil exports (yellow bar segments). So far this year, Corpus loadings have averaged about 1.6 MMb/d — twice the 800 Mb/d or so being shipped out of Houston-area terminals (green bar segments). In the Corpus area, Moda Midstream’s Ingleside terminal — soon to be acquired by Enbridge, as we discussed in a blog last week — has been the stand-out, loading an average of 665 Mb/d in the first eight months of 2021. Louisiana terminals as a whole have been exporting just under 300 Mb/d (orange bar segments), with the Louisiana Offshore Oil Port (LOOP) accounting for almost 70% of the state’s volumes. The Beaumont, TX, area has averaged about 160 Mb/d this year (blue bar segments), but its export volumes have picked up in recent weeks, likely due to recently enhanced pipeline connectivity from the Cushing, OK, hub.

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