Oil exports prompt splitter decisions in Corpus Christi

The lifting of a decades-old ban on crude oil exports primes Corpus Christi to become a key oil hub in the coming years, but it also dampens interest in expensive projects to export condensate, an ultralight oil not subject to the long-standing restriction.

In the short term, the South Texas port city probably will see a drop-off in announcements for new condensate splitters and stabilizers — processing equipment necessary to prepare condensate for export under previous rules.

Midstream operators are rethinking those plans now that federal legislation, passed and signed into law just last week, allows producers to ship all grades of crude. That means they don’t need to invest in infrastructure for processing condensate to get around the export ban, according to a new analysis by Housley Carr with RBN Energy.

But exports could be transformative for Corpus Christi, Carr argued, pointing to a massive build-out of its marine dock facilities that primes the city to capitalize on the new rules once economics improve for oil shipments overseas.

“Now that Congress has lifted restrictions on crude exports, the floodgates would appear to be open for surplus Eagle Ford and Permian crude to ship to overseas markets, provided the economics justify such movements, which they don’t at the moment,” Carr wrote in his analysis. “In the longer term though, exports could be the key to Corpus’ future.” (By Rhiannon Meyers, Fuel Fix)