©Kim Christensen
Lee College Economic Alliance event in Pasadena 2017
Lee College Economic Alliance event in Pasadena 2017 (Photos by ©Kim Christensen)
According to Ryan Sitton, there has been "a lot of interesting discussion" around port expansion throughout the Gulf Coast over the past four or five years. Specifically, the Port of Corpus Christi has requested federal government funds to dredge and expand the port deeper and wider.
"For 20 years, they could not get approved," said Sitton, commissioner of the Texas Railroad Commission. "The Army Corps of Engineers could not fit it into their budget. Then, two years ago, something changed. The United States lifted its crude export ban."
Sitton believes Corpus Christi, Texas, is an ideal location for port expansion.
"The area around Corpus Christi is not nearly as developed as it is, say, around Houston," Sitton said, speaking to delegates to the Economic Alliance Houston Port Region's Gulf Coast Industry Forum held recently in Pasadena, Texas. "You don't have to cut through a bunch of cities and towns for infrastructure. If we expand that port, we could actually export 3 million barrels a day of crude oil out of the state of Texas."
The Port of Corpus Christi currently has crude export capacity of approximately a million barrels.
"As production grows in Texas, as we export more, let's say we get to 3 million barrels a day. Three million barrels a day at $50 a barrel comes to $150 million a day in exports," Sitton calculated. "If we export 3 million barrels a day of our light, sweet crude, and we buy 3 million barrels a day of heavy sour crude from Canada, refine it in our infrastructure, that trade advantage at even $10 a day for 3 million barrels is $30 million just from selling our crude overseas [through our Texas ports]."
A new horizon for exports
"The world is moving in a new direction. The world is saying, 'We need energy,'" Sitton continued. "The United States' people, individually, use less energy today than we did two years ago. However, other countries around the world are growing their per capita energy usage -- plus they're growing their population."
From 2006-2016, approximate global crude oil demand went from 85 million barrels a day to 96 million barrels a day -- or a million barrels a day per year, Sitton said. Experts forecast growth in the next five years of as much as 1.5 to even 2 million barrels a day.
"The state of Texas has really been great in filling that gap in putting more crude oil on the market. And that is why I think that next year we are going to see crude oil at $60 per barrel," Sitton said. "The world continues to use more oil. The United States is producing it more cheaply than anybody else, and more and more countries that can't do it at $50 or $55 a barrel are going to slow down their production.
"The opportunities in energy today for our country and for our state are bigger than they have been since before I was born. You have to go back to the 1940s and 1950s to find a time in history when the United States had the ability to almost singularly, almost independently, control the energy markets.
"This opportunity will affect our state and our nation for a generation. Wouldn't we be proud to be able to say that under our watch is when the United States became the global energy powerhouse again? That is a legacy that every single one of us could be proud of."
For ongoing industry updates, visit BICMagazine.com.
