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Dynamics of Fossil Fuel Movement

General discussions of the systemic, societal and civilisational effects of depletion.

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Re: Dynamics of Fossil Fuel Movement

Unread postby ROCKMAN » Thu 11 Sep 2014, 07:56:07

But the Poles have a new plan to poke another finger in Putin’s eye: import LNG from the US. Of course there's still that nagging little problem with this plan: the US is a net NG and LNG importer. Maybe the plan is based on the idea of the US buying Russian LNG and then reselling it to Poland. Yeah, yeah, that’s the ticket. LOL. Of course even if the US and Canada eventually have excess LNG to export and prices do fall the EU will still have to compete with Asian countries for that NG. And so far those EU countries have admitted they can’t justify outbidding those other countries. And why? Because they can buy Russian NG cheaper. So once again economics trump national security:

Reuters – “Poland is looking for partners in the United States and Canada from whom it could import LNG for its terminal due to be launched next year. Representatives of Poland's largest energy companies will go to the United States in September to hold talks on potential deliveries even though U.S. LNG prices were uncompetitive for Polish clients for now.

"We are ready to find trade partners in the United States and Canada, who would supply gas to the newly-constructed LNG terminal in Swinoujscie," said a Polish representative. The Polish LNG terminal in the port city of Swinoujscie on the Baltic coast will initially be able to accept 5 billion cubic metres of LNG per year. Poland expects that the terminal to accept first deliveries by end-June 2015. “For now the prices offered by U.S. companies seem not very competitive for Polish clients, but there is a chance that prices will fall on the global market in the near-term," said the same representative.

Poland is looking to diversify its gas imports away from Russia. Russian gas is currently accounting for about three-quarters of Polish natural gas consumption. Poland said on Wednesday the volume of gas it has received so far this week from Russian gas monopoly Gazprom was down by at least 20 percent. Some European countries believe Moscow may use a disruption of gas to Europe as a trump card in its confrontation with the West over Ukraine.” {Well, double Da! LOL}

So even if the Poles can secure LNG imports the earliest they arrive is next summer. Won’t be much help this winter.
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Re: Dynamics of Fossil Fuel Movement

Unread postby ROCKMAN » Thu 11 Sep 2014, 09:01:18

One has to seriously wonder if we can really expect our govt to effective manage our energy future. Especially when different segments don’t appear to even communicate with each other. Here’s a story about the Energy Dept predicting a future for LNG exports with “U.S. natural gas resources…having a transformative impact on the U.S. energy landscape”. And in the same article the EIA is predicting a “record production” of 74.6 bcf/day in 2014 while the same EIA is reporting US NG consumption for 2014 ranging from a high of 105 bcf/day to low of 57 bcf/day in 2013. So how does the near term look for 2014? Here’s a hint: how much NG did the US produce/consume in 2013? We produced an average of 70.18 bcf/day while we consumed an average 71.34 bcf/day. Maybe one day the US will produce more NG then we consume. Maybe not. But the fact is very simple: the US is a net NG importer today. And while the EIA is reporting the US as a net NG importer the Dept of Energy is hyping LNG exports:

“The Energy Department announced Wednesday that it has issued the final authorization to Cameron LNG and Carib Energy to export domestically produced LNG to countries that do not have a Free Trade Agreement (FTA) with the United States. Following the recent announcement of the procedural change, the Department evaluated the Carib and Cameron applications after they completed the environmental review required by the National Environmental Policy Act (NEPA).

The development of U.S. natural gas resources is having a transformative impact on the U.S. energy landscape, helping to improve our energy security while spurring economic development and job creation around the country.”
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Re: Dynamics of Fossil Fuel Movement

Unread postby ROCKMAN » Thu 11 Sep 2014, 10:31:07

I always find it amazing how folks will try to spin a story either out of ignorance or a hidden agenda. Here’s a spin how it’s a bad time for the KSA to kick off a new refinery. The logic: lower oil prices produce lower refined product prices. Thus the KSA refinery will make less profit. The fallacy: a refinery’s profit is based upon the spread: the difference between what they paid for the oil and what they sell the product for. Historically the higher the price of oil the lower the profit/spread. And, conversely, the lower the price of oil the better the spread. So the new KSA refinery should be seeing a better spread/profit in the face of lower oil prices. Which doesn’t mean the KSA is netting as much total revenue from oil/product sales as they were before oil prices got soft. But it means they are probably netting more cash flow with the refineries running then they would be if they weren’t cracking oil themselves.

So how does it look on the KSA oil export books? Selling oil into a declining price market isn’t good news obviously. OTOH by running oil thru the new refinery means they are putting less oil into the market place which naturally helps support higher price potential. And even though the refined products are selling for less than previously the KSA is capturing that portion of the profit chain that would otherwise go to foreign refineries. Here’s the spin…decide for yourselves:

Reuters - If you could pick the worst set of circumstances in which to start up a giant, export-oriented oil refinery, you might well have them right now. Saudi Aramco and joint venture partner Sinopec have started test runs at their 400,000 barrel per day (bpd) Yanbu refinery, located in the oil-rich Middle Eastern kingdom. This puts the new plant on schedule to begin commercial exports in November, possibly even by the second half of October, according to trade sources. Yanbu will be the second major refinery to come online in Saudi Arabia in little more than a year, following the September 2013 start-up of the similar 400,000 bpd Jubail plant, a joint venture between Aramco and France's Total.

However, Yanbu is coming online at a time when crude demand growth in Asia is disappointing, the region's refiners are struggling to make decent profits, crude prices have gone into contango and Middle East producers are cutting official selling prices.
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Re: Dynamics of Fossil Fuel Movement

Unread postby Keith_McClary » Thu 11 Sep 2014, 11:43:47

ROCKMAN wrote:Reuters – “Poland is looking for partners in the United States and Canada from whom it could import LNG for its terminal due to be launched next year. Representatives of Poland's largest energy companies will go to the United States in September to hold talks on potential deliveries even though U.S. LNG prices were uncompetitive for Polish clients for now.
Developed by Polish state-owned Gaz-System:
https://en.wikipedia.org/wiki/%C5%9Awin ... G_terminal
https://en.wikipedia.org/wiki/Gaz-System
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Re: Dynamics of Fossil Fuel Movement

Unread postby ROCKMAN » Fri 12 Sep 2014, 20:39:11

And just one more indication why as new LNG supplies come into the market from any source won't likely help the EU out of their Russian bear trap. Again a reminder of how major LNG export projects are typically funded: the LNG is tied up by contracts several years before delivery begins. The EU countries need to be signing to major LNG contracts today for NG that won't be delivered for some time. A time well beyond the current predicament. But even with that hurdle you see little or no effort by the EU to tie up future supplies because they can't compete with Asian buyers. And why: because Russian NG is a better buy. And thus the trap they can't force themselves to leave.

Reuters - Japan's Tokyo Electric Power Co said on Friday it has signed a 17-year deal to buy up to 1.2 million tonnes per year of LNG from the Singapore unit of UK oil and gas major BP starting from April 2017. The LNG will be sourced from BP's portfolio, rather than a specific project, and the prices will be linked to the U.S. Henry Hub gas index rather than oil prices. LNG imports by Japan, the world's top buyer of the super-cooled fuel, has risen since 2011 when the Fukushima nuclear disaster lead to all of the country's nuclear reactors being shut down to face more stringent safety checks.
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Re: Dynamics of Fossil Fuel Movement

Unread postby Synapsid » Sat 13 Sep 2014, 06:57:47

ROCKMAN,

I have seen reference to LNG contracts signed with US companies by Italian and Portuguese companies (the latter to begin delivery in 2016) but no details. And there's pipeline goings-on for gas from Azerbaijan to reach Europe via Turkey though that will be a while. If there's much effort beyond that it isn't getting much publicity, as you say.
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Re: Dynamics of Fossil Fuel Movement

Unread postby ROCKMAN » Sat 13 Sep 2014, 08:37:40

Syn - For those curious about the details of global LNG movement here a lot of info to digest: http://www.natgas.info/gas-information/ ... t-database

The author has created an LNG Project Database that details key facts and data of approx. 90 LNG projects. This includes projects that are operational, under construction, under development and speculative projects. Included in the database are comments on the main markets, gas sources, pipeline lengths and Kerogen LNG Project Success Index scores (for select projects). The database is updated regularly to keep all the information current.
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Re: Dynamics of Fossil Fuel Movement

Unread postby Keith_McClary » Mon 08 Jun 2015, 00:03:45

Natural Gas Ministry Responds to Report Critical of LNG Prospects
Analyst David Hughes found BC gas reserves inflated, revenues overstated.
By Andrew Nikiforuk, 4 Jun 2015, TheTyee.ca
The Hughes report argued that the government's claim of a natural gas supply of 2,933 trillion cubic feet (Tcf) was not credible, given that the BC Oil and Gas Commission places B.C.'s proven reserves at 42.3 Tcf, with a total "marketable resource" (or what industry might be able to find, drill and frack) of 442 Tcf.

Reserves are a proven quantity based on drilling data, while resources remain a speculative number.

An email from Coleman's ministry said that it stands by the 2,933 Tcf as representative of "gas in place," or what other government websites describe as "marketable shale gas reserves."

But the ministry acknowledged that only 30 per cent of the 2,933 Tcf estimate -- or about 870 Tcf -- might be recoverable.

"With advancements in technology over the last few years, as well as investments made by industry to improve extraction methods in the province, the Ministry of Natural Gas Development believes a 30 per cent success rate is very achievable over the long-term," it said.

The ministry also referred to Hughes's conservative reserve number of 42.3 Tcf as "dated" and said that it "ignored the full size of the resource base."

(A cubic foot can fill a basketball, and B.C. currently extracts about 1.5 trillion cubic feet of fracked shale gas a year.)

In a separate commentary in the Asian Pacific Post, Coleman wrote that the province has 3,000 Tcf of "gas in place" and that the Hughes report misrepresented the facts.

Hughes fired back in the forum below the commentary: "Mr. Coleman's suggestion that 2,933 Tcf represents B.C. gas available is incorrect -- if it is not recoverable it is not available and not part of the supply."

The 2,933 Tcf figure is greater than the total estimated natural gas reserves for the United States. The U.S. Potential Gas Committee estimates that there is a little over 2,800 Tcf that can be extracted from shale, coal bed methane and conventional gas deposits throughout the U.S., which includes all probable, possible and speculative resources.
...
Profits, 'clean' gas questioned

The B.C. government has said that its proposed LNG industry could earn windfall profits of more than $100 billion over 30 years based on the price differential between North America and Asia for natural gas.

But the Hughes report argues that this price differential has dwindled due to oversupply and volatile global markets.

Asked how the province will make money at current low Asian gas prices, the province replied: "Exporting LNG would open British Columbia's natural gas sector to new, growing markets in Asia where commodity prices are higher. LNG proponents are looking over a 30-40 year horizon. In the long-term, natural gas is a clean energy fuel with increasing, global demand."

Hughes also argued that LNG exports to China will not decrease greenhouse emissions, but instead make them worse due to methane leaks, energy costs and waste.

Addressing that claim, the government said: "Our government promised the cleanest LNG facilities in the world, and that is exactly what we will deliver. B.C.'s greenhouse gas benchmark sets the highest standard for LNG facilities in the world. Incentives and flexible options will encourage industry to invest in energy efficiency and clean energy."

Hughes responded that delivering on such promises would incur higher costs that may make the industry economics prohibitive. Using electricity as opposed as natural gas to power liquefied gas terminals, for example, would drive up costs and make LNG terminals in B.C., already among the most expensive in the world, even more uneconomic.
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Re: Dynamics of Fossil Fuel Movement

Unread postby ROCKMAN » Mon 08 Jun 2015, 04:36:15

"...30 per cent success rate is very achievable over the long-term..." Actually that sounds rather pessimistic depending on how one defines "success rate": rarely are shale wells "dry holes". Of course that doesn't mean every on turns a profit either.

And it's the old chicken and egg problem: very difficult for anyone to spend $billions on an LNG plants if they don't have a GUARETEED volume of NG available to meet contracts as well as buyers signed on to those contracts. Just ask Chenier that lost $billions building an LNG IMPORT facility in Texas that has never imported a $'s worth of LNG. They are now spending $billions to convert it to an export facility. They learned their lesson: this time they are tying up supplies and buyers.
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Re: Dynamics of Fossil Fuel Movement

Unread postby ROCKMAN » Tue 28 Jul 2015, 09:19:58

Just the latest small ripple on the water. The Japanese are taking "our oil":

Reuters - Mexico's Pemex has agreed to ship six million barrels of its light crude to Japan's largest refinery over the next six months, as the state-run oil company seeks to further develop its ties with Asia. Pemex already shipped about 4 million barrels to JX Nippon in the first half of the year. Pemex had been negotiating with buyers in Japan and South Korea earlier this year about the chloride content of its crude, and said it would offer discounts if the level of the chemical that can cause corrosion was higher than usual. "These operations contribute to the strengthening of Mexico as an important supplier of crude to the Far East, the highest-growing region in the world," Pemex said in a statement.
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Re: Dynamics of Fossil Fuel Movement

Unread postby ROCKMAN » Fri 14 Aug 2015, 12:23:38

More lies from the MSM regarding the alleged US oil export ban:

Reuters – “The Obama administration will allow limited sales of U.S. crude to Mexico for the first time, a senior administration official told Reuters, marking another milestone in loosening a contentious ban on exporting domestic oil.”

Granted the volume has been very small for a number of years. But the peak US oil export to Mexico was in Aug 1996 when we exported 200,000 bbls to that country.. And the lie goes a tad deeper: it isn’t a “sale” of oil to Mexico but a swap of US oil for Mexican oil. Such oil swaps have been done for many years. Typically it has been done with Alaskan oil going to Japan. Japan might buy an oil contract from Venezuela and swap it with a US refiner for its oil. The motivation was to save transport costs. Just as the 200 millions of US exported oil per year rate we just saw last April/May: don’t argue with these numbers: they come from the US govt’s own EIA.

BTW: read the story I posted just above this one: Hmm? LOL.
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Re: Dynamics of Fossil Fuel Movement

Unread postby ROCKMAN » Sat 29 Apr 2017, 15:32:40

Easily predictable as we stumble down the peak energy path:

"Australia’s Prime Minister Malcolm Turnbull is taking a leaf out of U.S. President Donald Trump’s “America First” playbook.

Just days after announcing a crackdown on foreign workers and tightening citizenship rules, Turnbull announced an effort Thursday to restrict gas exports by energy giants to protect domestic supply. “Australian demand, Australian businesses, Australian jobs, Australian families have to come first,” Turnbull told reporters as he detailed plans to possibly limit exports by firms including Royal Dutch Shell Plc, Santos Ltd. and Total SA. “It is fundamental action needed to protect the national interest.”

“There is a heightened level of political risk now in Australia which means we are a less attractive place for investment,” according to Saul Kavonic, lead Australia analyst at energy consultant Wood Mackenzie Ltd. Turnbull’s move “is likely to have unintended consequences for energy security and for the economy as a whole. The government announced on Thursday that from July 1 a “targeted licensing system” will be activated for exports if there’s a shortfall for Australian customers.

Gas producers said they would work with the government, but cautioned against export sanctions. APLNG, one of three Queensland LNG plants and owned by Origin Energy Ltd., ConocoPhillips and China Petroleum and Chemical Corp., said intervention would not lower prices or increase supply."

{Limiting the market by limiting exports can have a similar long term effect to price controls. Price controls which typically can cause shortages.}
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Re: Dynamics of Fossil Fuel Movement

Unread postby sparky » Sat 29 Apr 2017, 19:01:39

.
That's a fall out of the great South Australia alternative disaster ,
I think it's SeaGypsy who first raise this price differential issue

when the proposal came to crank up gas fired generators , there were AaaaHhhh ,
then some OoooHhhhh when the pesky techs told them there wasn't enough stuff to go around .
not for South Australia , certainly not enough for Victoria and New South Wales ,
it would in fact get worst ,
The federal government is looking like election loosers ,some strong statement was in order
the gas exporters have just learned the first law of modern society .
you can get away with a lot as long as it's not front page , then the people elected grow a conscience
The proper response is ...
1- roll with the punch , say " Mhhh! what a good idea " to everything
2- wait until the elected parrots are occupied by something else

P.S. This thread is excellent ,
it touch all the sensitive part of the energy supply web ,politics ,geopolitics ,technicals ,transport line ..ETC
I'm glad to see it back where it belong , the front page
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Re: Dynamics of Fossil Fuel Movement

Unread postby ROCKMAN » Sat 29 Apr 2017, 21:20:09

A speaking of a country exporting increasing amounts of its finite energy resources to the potential determent of its citizens:

The U.S. is set to ship its first shale gas to a member of the former Soviet bloc as Europe seeks to cut its dependence on fuel from Russia. Poland’s state-owned PGNiG SA bought a spot liquefied natural gas cargo from Cheniere Energy Inc.’s Sabine Pass plant for delivery in June to the nation’s Baltic Sea import terminal, the first such contract for Central and Eastern Europe. No LNG has been shipped to northern Europe since Sabine Pass started exports more than a year ago.

Poland may offer a new outlet for Cheniere, which said it’s targeting emerging markets as new production facilities from Australia to the U.S. lead to a glut of the fuel. Poland’s Law & Justice government has sought to cut the nation’s dependence on Russia’s Gazprom PJSC for more than two-thirds of gas supplies, stating it has no plan to extend a long-term supply contract beyond 2022 and plans new infrastructure including a pipeline to Norway.

From: http://fuelfix.com/blog/2017/04/27/chen ... ssian-gas/
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Re: Dynamics of Fossil Fuel Movement

Unread postby sparky » Sun 30 Apr 2017, 18:29:11

.
I could confuse the Sabine pass plant delivery with another
but I've read that so far there has been a grand total of two LNG tanker delivery from the US to Europe
one of them a technical test trial for the systems commissioning .
Lithuania build a large LNG reception plant around Klapeida but didn't use it much
the bare fact is that all the talk of independence from Russia supply are fair and good
until the penny drop in , LNG is more expensive than piped gas
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Re: Dynamics of Fossil Fuel Movement

Unread postby ROCKMAN » Sun 30 Apr 2017, 23:24:58

sparky - Here you go. Typical of the crappy MSM: they hype the sh*t out of potential US LNG exports a few years ago, get bored and doesn't keep the public informed. Thank Dog the Rockman is here to fill the gap. LOL. From 3 April 2017

"This past weekend marked some notable milestones achieved by Cheniere Energy and, by proxy, the nascent U.S. LNG export industry. Cheniere announced the departure of the 100th LNG cargo from its Sabine Pass facility on Saturday, itself a key checkbox for U.S. energy exportation.

Averaging one shipment every 4 days - Since the first shipment on February 24, 2016, Cheniere has averaged about one shipment every four days. Shipments have been accelerating, though, as 44 of these cargoes have been shipped in 2017. In total, cargoes have been delivered to 18 countries on five continents.

Cheniere exported 56 cargoes in 2016 totaling about 200 Bcf to 17 countries. The most common destination was Chile, where 9 cargoes were delivered. Latin America received more than half of all cargoes, in fact, with 27 shipments split between Chile, Mexico, Argentina, Brazil, and the Dominican Republic.
While a country-by-country breakdown is not yet available for shipments in 2017, Cheniere did describe all destinations of cargoes shipped in 2016 in its fourth quarter earnings."

More in the link if interested.
https://www.oilandgas360.com/lng-chenie ... -shipment/
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Re: Dynamics of Fossil Fuel Movement

Unread postby Tanada » Mon 01 May 2017, 00:16:08

ROCKMAN wrote:sparky - Here you go. Typical of the crappy MSM: they hype the sh*t out of potential US LNG exports a few years ago, get bored and doesn't keep the public informed. Thank Dog the Rockman is here to fill the gap. LOL. From 3 April 2017

"This past weekend marked some notable milestones achieved by Cheniere Energy and, by proxy, the nascent U.S. LNG export industry. Cheniere announced the departure of the 100th LNG cargo from its Sabine Pass facility on Saturday, itself a key checkbox for U.S. energy exportation.

Averaging one shipment every 4 days - Since the first shipment on February 24, 2016, Cheniere has averaged about one shipment every four days. Shipments have been accelerating, though, as 44 of these cargoes have been shipped in 2017. In total, cargoes have been delivered to 18 countries on five continents.

Cheniere exported 56 cargoes in 2016 totaling about 200 Bcf to 17 countries. The most common destination was Chile, where 9 cargoes were delivered. Latin America received more than half of all cargoes, in fact, with 27 shipments split between Chile, Mexico, Argentina, Brazil, and the Dominican Republic.
While a country-by-country breakdown is not yet available for shipments in 2017, Cheniere did describe all destinations of cargoes shipped in 2016 in its fourth quarter earnings."

More in the link if interested.
https://www.oilandgas360.com/lng-chenie ... -shipment/


Interesting data, and perhaps this explains why Argentina is eagerly subsidizing the Vaca Meurta shale development. If they can get a major boost of cheap natural gas they can eliminate their expensive LNG imports and perhaps even pipe gas over to Chile next door for a nice profit.
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Re: Dynamics of Fossil Fuel Movement

Unread postby ROCKMAN » Mon 01 May 2017, 10:15:42

T - And one of the problems that might persist even as more domestic production is developed: lack of storage to deal with peak demand periods. Especially for Argentina: even when well production was sufficient the cities would have bad shortages due to distant delivery problems. LNG can unload directly into the city gate to at least provide some relief.

Obvious delivering NG to end user is a more complex dynamic then drilling some more wells.
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Re: Dynamics of Fossil Fuel Movement

Unread postby ROCKMAN » Wed 28 Jun 2017, 09:59:26

And now an update on Russian NG moving to the UK:

Gazprom PJSC is in talks to ramp up natural gas sales in the U.K. as coal plants are shuttered and the nation’s biggest storage site is closed for good. “We see an appetite from major players in the U.K. for additional volume of contracted gas,” Deputy Chief Executive Officer Alexander Medvedev said. “Our supplies to the U.K. increased substantially in the course of the last two years.”

The world’s biggest gas producer {Incorrect: the US produces about 35% more NG then Russia} sees an opportunity to sell more of the fuel after Centrica Plc announced it would close its Rough storage facility in the North Sea and the nation plans to stop using coal-fired plants by the middle of next decade. Medvedev expects Britain to increase imported volumes by 8 billion to 12 billion cubic meters a year by 2025.

After opening an office in 1999 outside London, Gazprom has gradually expanded in the U.K. market through acquisitions. Earlier this year it became one of the largest retail gas suppliers to British industrial and commercial buyers after one of its units completed an acquisition of Wingas U.K. The additional supply deals with U.K. buyers will be brokered through the British trading unit, according to Medvedev.

While Britain’s import needs are mostly met by Norway, it also receives Russian fuel indirectly through pipelines on the European continent, which is typically cheaper than liquefied natural gas cargoes.
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Re: Dynamics of Fossil Fuel Movement

Unread postby ROCKMAN » Wed 28 Jun 2017, 10:20:01

And for those silly folks who tried to convince our clan that US condensate/light oil was "worthless" and there was no market for it. In addition to the 2 two oil pipelines that were reversed from the Eagle Ford Shale trend to carry oil to the port of Corpus Christi plans are being considered to move larger volume of condensate/light oil from the Permian Basin to the port's export terminals:

"Exports could double by the end of this decade, expanding the importance of Corpus Christi to the domestic industry.

Late last month, an oil tanker that measures three football fields long and six stories high moved slowly through the port of Corpus Christi, Texas, to test the waters of America’s booming crude-export industry. Its arrival in South Texas marked the first time ever a tanker of that size had called on a U.S. terminal in the Gulf of Mexico.

The Anne docked at Occidental Petroleum Corp.’s terminal to determine if some of the world’s biggest carriers could start ferrying oil from Texas to foreign buyers. Corpus Christi is vying to become America’s main export hub. “Corpus Christi was the No. 1 port for U.S. crude exports last year, and this trend is continuing,” said John LaRue, the port’s executive director."

{And all thanks to that "worthless" condensate/light oil that no one has a use for from the shale plays. LOL}
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