Texas Gulf Coast Exports More Oil Than It Imports for First Time Ever
The Texas Gulf Coast made a breakthrough last week when it exported more oil than it imported for the first time. Texas became a net exporter of 15,000 crude oil barrels per day (bpd) – a mindboggling 1 million bpd positive reversal for the state’s trade balance from less than three years ago.Oil exports in the US have reached a record 2 million bpd, and are still accelerating on the back of the Lone Star state, which accounts for about 75% of the nation’s export resurgence. US oil imports at the same time have dropped by 14% to 7.8 bpd over the last six years, in an environment where oil usage has escalated. In other words, the shining turnaround exemplified by Texas going from import-dependent to becoming a net energy exporter is expected to extend to the entire nation in the next two years.The Permian Basin in Texas has led the way as a strategic export entrant for the US in the world’s oil drilling stage. It is undeniable that the Permian Basin activity has reduced our aggregate oil imports and our dependency on volatile OPEC members. At the same time, it has become a serious exporter of excess production to its targeted international segments, namely Canada, China, India, Italy, and the United Kingdom. This classic double-whammy effect has the US projected toward attaining net oil exporter status by 2022 (at the latest) - and probably 2020 by all indications.Notably, the Texas oil shale fields produce a lighter blend of oil that has high demand internationally as well as domestically. Heavy crude, on the other hand, continues to be an import energy item for the US. The need for a lighter blend of oil in international markets coupled with new extraction technologies has helped Texas ramp up its exports.Drillers have found new ways to unlock oil reserves contained in deep underground shale structures, previously deemed to be inaccessible. This new fracking technologyhas substantially reduced the costs of shale oil extraction making the US competitive in the international oil markets. Texas (if it was to be considered the equivalent of a single country) is now the world’s third biggest oil producer - ahead of Iraq and Iran, trailing only behind Saudi Arabia and Russia.To keep up with the rapid pace of drilling, infrastructure development has to increase. While there are multiple ports of entry along the Texas Gulf Coast, only the Louisiana Offshore Oil Port is a deep-water harbor capable of accommodating supertankers. An increase of deep-water harbors with wider shipping channels has to be expanded to include other essential cities like Houston, Texas City, Freeport and Corpus Christi if net exporter ambitions are to become a reality. The future is bright; indications are that financing like Corpus Christi Port’s recent bond raise of $218 million is earmarked and will be accessible in the coming months.
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Chase Energy Services is one of the largest privately held integrated oilfield services company in the US, providing end-to-end oilfield services through an experienced management team, innovative technologies and an unrelenting focus on safety. With more than 500 employees, the company serves customers across Southwest New Mexico and West Texas in frac and acidizing, well construction and completion, cementing solutions and well servicing. learn more
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