PORT OF TEXAS CITY PLAYING KEY ROLE IN NATION’S RISE ATOP WORLD’S OIL PRODUCERS

ALMOST QUIETLY, THE PORT OF TEXAS CITY is now in the forefront of the nation’s rise as the world’s largest producer of oil. As the success in the state’s Permian Basin has helped the United States produce nearly 12 million barrels per day, the process of exporting crude has led the port becoming perhaps the nation’s leader in welcoming Very Large Crude Containers (VLCC). Since the FPMC C Melody arrived last at the port’s Enterprise Terminal last June – making it the first port in the nation to receive a VLCC – six more have made their way to Texas City. “The frequency of VLCCs is increasing,” said Greg DeLong, the Marine Liaison for Enterprise Products, which has partnered with Enbridge to form the Seaway venture. “There is more interest in ports wanting to have VLCCs, but we are currently in position to handle what the demand has to offer.” Enterprise has averaged loading more than a million barrels at its terminal, yet the massive size of the VLCCs (at least 1,100 feet long) means they are filled at barely over half its capacity. However, Seaway is in the process of developing offshore deep-water ports that would allow the VLCCs to be loaded near their maximum storage. Once that goal is reached, the average of U.S. crude exports will continue to increase. The timing could not be more perfect for the port. Crude oil exports in the United States, which hovered at just under four million barrels per day in 2008, is projected to approach 7,000,000 barrels per day by 2025. The Permian Basin alone is currently delivering more than 3.8 million barrels per day, a number that will rise sharply as Royal Dutch Shell and BP begin to eye the vast bounty that Exxon and Chevron have led the way in making the Basin one of the world’s hottest oil exploration sites. “I am becoming more convinced that the Permian Basin could eventually give Ghawar a run for its money,” said Forbes Magazine contributing writer Robert Rapier, referring to the Ghawar oil field in Saudi Arabia, which have consistently produced more than 5 million barrels per day for the past 20-plus years. That, in turn, brings the port’s ability to handle VLCCs as a major player in the process. “All of this is being driven by the Permian Basin,” said Rick Rainey, Vice-President of Public Relations for Enterprise Products. “There’s a need for an outlet to ship it off, and we’re in the right place to do so. Still, we’re going to need all the infrastructure we can get to become even more efficient.” Enterprise envisions that the port will be able to load between 80-90 percent of the barrels before the VLCCs head offshore to take in the rest. Rainey added that the Enterprise terminal is expecting at least four more VLCCs to arrive into Texas City within the next few weeks