Moda Midstream Eyes Second TX VLCC Berth
Moda Midstream LLC is considering building a second berth at its Ingleside, Texas, crude export terminal to accommodate booming shale oil production on the Gulf Coast, the company's chief executive said on Thursday.
The expansion to the terminal that loads oil tankers will come as three major pipelines open in the second half of 2019, CEO Bo McCall said in an interview. Moda is also increasing the facility's crude storage capacity to 10 million barrels from 2 million.
"When these new pipelines come online, there is going to be close to 3.5 million barrels a day coming into the market," McCall said. "Demand is very strong. And we're working very fast."
Moda will decide if it will modify additional berths within three months, McCall said. Once approvals are received, the berths could go into use within two years.
U.S. crude exports hit a record 3.36 million barrels per day (bpd) in late February, according to the U.S. Energy Information Administration, as a shale boom lifted production to 12.1 million bpd. The United States began exporting crude in 2016 after Congress halted a 40-year-old export ban and has become a major supplier to global markets.
McCall said he expects U.S. oil exports to rise sharply after new pipeline projects advanced by Plains All American Pipeline LP, EPIC Crude Pipeline LP and Enbridge Inc start service.
Moda purchased the Ingleside facility from Occidental Petroleum Corp last August. The terminal can partially load very large crude carriers, which have the capacity to carry as much as 2 million barrels of oil.
The U.S. Army Corp of Engineers this year is expected to award a contract to dredge the Corpus Christi ship channel to the Ingleside facility to a depth of 54 feet from 47 feet, which would allow Moda's loading ability per supertanker to rise to 1.5 million barrels.
Reporting by Collin Eaton and Florence Tan