Reuters: new Permian oil pipelines unlikely to be built, say top operators
Published by Alfred Hamer,
Editorial Assistant
World Pipelines,
Reuters has reported that top executives of two US energy pipeline operators on Thursday ruled out building new crude oil lines to move volumes out of the Permian shale field in West Texas because of tepid volume growth and difficulties constructing new lines.
Enterprise Products Partners co-CEO Jim Teague said at a Houston energy conference his firm is not considering a new oil pipeline out of West Texas. The CEO of rival operator Plains All American Pipeline said at the same event companies are more likely to optimise existing rather than build new lines.
Enbridge will add up to 120 000 bpd to its Gray Oak oil pipeline by 2026, an example of expanding capacity on an existing pipeline. Enterprise has said it could convert a natural gas liquids pipeline to carry crude.
Shale pipeline operator EPIC Consolidated Operations is weighing expanding a Permian to south Texas line by about 300 000 bpd. The expansion is a "when, not an if," said EPIC CEO Brian Freed.
The executives said Permian shale producers are not likely to return to their era of fast-growth that prompted the construction of new oil lines last decade. Drillers remain disciplined in their spending for new volumes and do not look to drill and grow production even if prices jump from current levels, Chiang added.
"A range of roughly of US$60 – US$90 per barrel doesn't change their plans too much," he said. Output from the Permian basin in the next few years could rise about 300 000 bpd, he said. "Most of the producers out of the Permian, because of the consolidation, are taking a more measured pace," EPIC's Freed said.
Enterprise' Teague also said that his company continues to advance its proposed deepwater oil export project, Sea Port Oil Terminal (SPOT), but "nobody wants to be (the) first" customer to sign up.
"Things have changed, but my gut feeling is that we'll be able to get SPOT across the finish line," Teague said while speaking at an RBN Energy conference in Houston. However, Plain's Chiang said "the jury is out on SPOT," saying it while it makes a lot of sense on paper, existing export contracts and systems could limit availability of customers.
Read the original article here.
Image: Enterprise Products Partners Co-CEO Jim Teague speaks at RBN Energy Conference in Houston, Texas, 24 October 2024, credit: Reuters
Read the article online at: https://www.worldpipelines.com/project-news/25102024/reuters-new-permian-oil-pipelines-unlikely-to-be-built-say-top-operators/
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