Enbridge’s recent $200 million deal to buy two marine docks and land in Ingleside, TX, from Flint Hills Resources (FHR) may not be much of a surprise, as expanding its role in U.S. crude exports has been part of Enbridge’s strategy since it bought Moda Midstream’s big marine terminal next door nearly three years ago. The former Moda terminal, now known as the Enbridge Ingleside Energy Center (EIEC), can receive and partially load Very Large Crude Carriers (VLCCs) — a key reason why the facility is #1 in crude exports in the nation. In today’s RBN blog, we will take a closer look at Enbridge’s deal with FHR and how it might help grow its crude export volumes.
The deluge of light (and super light) sweet crude from U.S. tight-oil plays like the Permian Basin, Bakken and Eagle Ford has had many effects, including a push by refiners to rework facilities designed for heavy-crude processing to handle an excess of lighter oils. Many of these projects are underway and expected online in the next two years. Today, we consider refinery infrastructure investments that might not pan out in a low crude price world.
Refineries located close to booming Eagle Ford shale production have nameplate capacity to process over 900 Mb/d of crude but can only consume 375 Mb/d of local output today. That is because the larger refineries in Corpus Christi were built to process heavy sour crude oil instead of ultra light Eagle Ford. New additions will expand light crude capacity by 100 Mb/d in 2015 (in addition to planned condensate splitters). Today we detail Devon and Genesis pipeline projects as well as regional refining capacity.
They say that being in the right place at the right time has a lot to do with success in business. Two companies with infrastructure in the Eagle Ford can certainly attest to that. Koch Industries and NuStar Energy both owned pipeline assets supplying crude to refineries in South Texas long before the shale boom – putting them in a strong position to benefit from the flood of crude on their doorstep. Since 2011 both companies have expanded pipeline and terminal infrastructure to ship nearly 600 Mb/d of crude and condensate between them. Today we explain how.
