With at least eight new offshore crude oil export terminals vying for a pick me! selection along the Gulf Coast, competition is tightening to develop ports capable of mooring Very Large Crude Containers (VLCCs) that carry up to 2.2 million Bbls of oil. Keep in mind, the nation’s only deepwater crude export hub right now is the Louisiana Offshore Oil Port (LOOP), which originally served as an import point for foreign oil. Since the first U.S. export load in early 2018 from its terminal south of Port Fourchon, LOOP has continued to experience record-shattering numbers of crude hauls via supertankers to global destinations.
So, here’s where we find ourselves. Declared last year as the world’s largest net exporter of oil, the U.S. now faces a whole new kind of infrastructure bottleneck—as in a dearth of shipping terminals and connecting on- and offshore pipelines to deliver crude supplies to international markets eager to buy. But stand by in the wheelhouse. Progress is afoot.
Among the many contenders in the race to build more offshore export facilities, Dallas-based Sentinel Midstream just announced that its Texas GulfLink subsidiary has inked an agreement with Conn.-based Freepoint Commodities to build a deepwater port 30 miles off the coast of Freeport, Texas. The GulfLink system will include both on- and offshore components to accommodate two VLCCs requiring a depth anywhere from 53-75 ft. Suffice it to say, the dredging business to widen and deepen the shallow 45-ft waters off the Gulf Coast is performing very well. The Texas Port Capital Program for 2020-2021 allocates nearly $1.5 billion for ship channel improvements to harbor VLCCs.
In the meantime, we look forward to hearing more from fellow sprinters Enterprise, Phillips 66, Trafigura, Enbridge, Jupiter, Energy Transfer and Tallgrass Energy—all of who must be burning the midnight oil to advance their offshore crude projects that stretch from Louisiana to Texas. RMR will keep you posted.
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