waterborne

A couple of years ago in December 2012 we posted a blog in our Oh-Ho-Ho It’s Magic series covering the bigger Gulf Coast crude oil supply picture. At the time we wanted to provide a summary view of all the changing crude flows happening at the Gulf Coast. Back then the Seaway Phase 2 and TransCanada Cushing Marketlink pipelines from Cushing to the Gulf Coast had not opened up and there was over 50 MMBbl of crude stuck in Cushing inventory. Things are a lot different today.  Today we break down the crude balance for the Gulf Coast - PADD (Petroleum Administration Defense District) III region since the start of 2011.  

Houston area refineries are the first to experience the full impact of the flood of domestic and Canadian production headed to the Gulf Coast in 2013 and 2014. These refineries have traditionally relied on floating storage in the form of import cargoes in transit to buffer them against supply shocks. Now the region is adapting to new crude supplies mostly delivered by pipeline. As imports decline, the floating storage option disappears, leaving the potential for congestion caused by inadequate onshore working storage. Today we calculate the storage impact of these changes.

Eagle Ford crude production is close to 600 Mb/d as of July 2012. Most forecasts show that number increasing to about 1,200 Mb/d over the next five years. Takeaway projects being developed today to go online by 2013 have capacity for 1,650 Mb/d. The midstream companies building these projects are either wildly optimistic or they know something about Eagle Ford production that we don’t. Today we look at plans for condensate takeaway from the Eagle Ford.

<p>Eagle Ford crude production is close to 600 MB/d. Midstream infrastructure projects are springing up left, right and center to deliver this production to refineries.</p>