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According to Gibson, “in the very near term, The Corpus Christi Channel Improvement Project should be due for completion by Q4 2023 or Q1 2024. This aims to deepen and widen the channel at Ingleside to accommodate vessels with a larger laden draft which means an additional 15% more cargo can be loaded onto a VLCC upon completion. This means lighterage will still be required to bring the cargo to full size. Meanwhile, the BlueWater Texas project is awaiting MARAD license approval to proceed. At present, it is unclear what the potential time frame for such approval is, but it is unlikely to occur in 2023”.
The shipbroker added that “perhaps the project at the most advanced stage in the process is the Sea Port Oil Terminal (SPOT), 30 nautical miles off Freeport, Texas in relatively deep water, which is currently penciled in for a startup in 2026-2027. It has received a Record of Decision (ROD) from MARAD and outlines the final step before receiving a full license prior to construction. Terminal capacity is intended to be 85,000 barrels per hour which results in a full cargo in approximately 26 hours, but it may take a commissioning period to reach full operational capacity. Also offshore, the 1.1 mbd Texas Gulflink project could be operational from 2026 but is facing some local opposition. Finally, the 1.9 mbd Blue Marlin project is expected to receive regulatory approval in Q2 2024 to begin construction. All in all, considerable work is still required to bring these projects to reality”.
Gibson also noted that “so far this year, there has been a notable increase in VLCC volumes out of the USG. As of writing, a record 2.25 mbd has been shipped in 2023 versus 1.535 mbd in 2022. This comes as the IEA is forecasting rising Atlantic crude output, driven by growth in Americas production, in which the US is expected to add an additional 2.6 mbd of additional barrels by 2028. This is expected to contribute to a growing West to East trade over the medium term, where VLCCs will be the logical preference for many shippers in Asia. Meanwhile, in the shorter term we have seen a ramp up in VLCC crude shipments from the USG to Europe, with VLCCs already dominating for shipments into Netherlands and France. For the US to increase its export potential further, these projects will need to come online and reach full operational capacity in this time frame. The current speed of these developments could start to raise some questions should sufficient progress not be made in the coming years”, the shipbroker concluded.
Nikos Roussanoglou, Hellenic Shipping News Worldwide
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