DOC authorizes EPP, Pioneer to export condensate

Two companies have received authorization from the US Department of Commerce to sell condensate to buyers outside the US, and analysts expect the sales—probably involving condensate from the Eagle Ford in South Texas—could begin in August.

DOC’s Bureau of Industry and Security (BIS) issued a private ruling on June 24 saying Enterprise Products Partners LP and Pioneer Natural Resources Co. could sell condensate to foreign buyers. Few details were immediately available.

“[DOC’s] determination has led to further clarity about what the definition of processed might mean,” said Michael Cohen of Barclays Research Inc. of New York. He believes “a widespread lifting of the crude oil ban is out of the question without a lifting of the Jones Act.”

Condensates drop down as liquids from natural gas streams and also as part of the liquid coming out of the wellhead from shale oil plays.

Consultant Muse, Stancil & Co. previously has noted in industry presentations that much of the Eagle Ford production is condensate.

Wood Mackenzie Ltd. said it has long believed that DOC officials had the tools to authorize limited exports of condensate.

“While it may allow barrels to find a new home and some economic optimizations to be achieved, we don’t think it dramatically affects crude prices in the short term,” WoodMac said in a news release. Long-term effects on crude prices have yet to be studied.

The US has export bans in place for unprocessed crude oil. A DOC spokesperson said there has been no change in policy.

Cohen said the Jones Act would need to be lifted for a widespread lifting of the crude export ban because of national security and economic reasons.

“The political inter-linkage associated with these two policies means that [DOC] will likely continue to operate within the confines of the current statute,” he said.

Contact Paula Dittrick at paulad@ogjonline.com.

Related Articles

Market watch: Energy futures prices rose slightly Friday

05/06/2002 Crude oil futures prices rose slightly Friday amid lingering uncertainty about a possible disruption of Middle East supplies, although tensions in ...

Gulf of Mexico oil service sector showing signs of an upturn

05/06/2002 The Gulf of Mexico oil service sector is experiencing the signs of an upturn, analysts with Simmons & Co. International, UBS Warburg LLC, and RBC D...

OTC: Industry, national agencies need to work together to make FPSOs work in the gulf

05/06/2002 Over the coming years, the oil and gas industry will have to keep an open line of communication with national agencies such as the US Coast Guard a...

Market watch: Energy futures prices fall as Iraq lifts embargo

05/07/2002 Crude oil futures prices fell Monday after Iraq announced plans to lift a self-imposed export embargo with exports expected to resume by Wednesday.

Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!

 

Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected