Crude output from the Permian is expected to jump 50% by 2025, according to BloombergNEF. ESAI Energy forecasts crude and condensate from the Bakken, another prolific play, will surpass record output into next year.
The project, which is being developed with the Port of Corpus Christi, would compete with nearby shale export terminals proposed by investor Carlyle Group and commodities trader Trafigura AG. Its project would be at least the ninth project proposed for the Gulf Coast.
U.S. crude exports hit 3.12 million barrels per day (bpd) this month from zero before the U.S. lifted a ban on exports in late 2015. Shale oil from fields in Texas, Colorado, New Mexico and North Dakota is projected to push U.S. output to 12.32 million bpd this year, according to U.S. forecasts.
The facility could load up to 1.56 million bpd, nearly the capacity of a supertanker. If approved by the U.S. Maritime Administration, U.S. Coast Guard and Texas regulators, operations could begin in mid-2021, said a person familiar with its plans.
Exxon Mobil Corp. and Saudi Arabia’s state-controlled petrochemicals company formally approved construction of a new chemical complex in Texas that will process production from the Permian Basin’s booming oil and natural gas wells.
The project near Corpus Christi will be the world’s largest steam cracker and create $50 billion of “economic output” in the first six years, Exxon and Saudi Basic Industries Corp., known as Sabic, said in a joint statement on Thursday. The facility will convert hydrocarbons such as ethane and propane to ethylene, a chemical used to make everything from plastics to antifreeze.
In simple terms, the EIA counts production, exports, imports, change in storage and refinery usage. This should pick up every barrel of oil moving through the U.S. It must frustrate the EIA’s number crunchers that the figures never foot, so they use a balancing item which used to be called “Unaccounted for Crude Oil”, nowadays simply the Adjustment. Since June 2018, the Adjustment has almost tripled.
Undercounting crude oil production seems the most likely explanation. If so, this would reinforce a couple of important themes:
1) The U.S. continues to gain market share in world energy markets
2) Growing volumes even with moderate pricing defy those who argue that much of our shale activity is unprofitable
Oil and gas production continue to surprise to the upside, which can only be good for midstream energy infrastructure.
Texas continues to produce more crude oil than any other state or region of the United States, making up 40% of the national total in 2018. Texas has held the top position in nearly every year since 1970, with the brief exception of 1988, when Alaska produced more crude oil than Texas, and from 1999 through 2011, when production from the Federal Offshore Gulf of Mexico region was higher.
Texas crude oil production averaged 4.4 million b/d in 2018 and reached a record-high monthly production level of 4.9 million b/d in December 2018. Texas’s 2018 annual production increase of almost 950,000 b/d—driven by significant growth within the Permian region in western Texas—was nearly 60% of the total U.S. increase.