Port Arthur/Beaumont

Pipelines delivering crude to Houston from the South Texas Eagle Ford are estimated to be half empty. Yet over 200Mb/d of crude is shipped from that basin to refineries in Houston and further east along the Gulf Coast by barge. One of the key reasons appears to be that local traffic congestion and a lack of adequate throughway pipeline capacity past Houston pushes barrels not needed locally onto the water to reach refineries in Louisiana. Today we explain the Houston crude traffic problem.

The proposed 400 Mb/d Shell Pipeline Company Westward Ho pipeline from St. James, LA to Nederland, TX was first touted in 2011 and initially expected to be in service by Q3 2015 but is now delayed at least until the end of 2017. The project is designed to replace the Shell Ho-Ho pipeline that used to ship crude from Louisiana to refineries on the Texas Gulf Coast until it was reversed in 2013. Westward Ho has struggled to attract shipper commitments to bring additional crude into the saturated Texas Gulf Coast market. Today we review the project’s rationale.