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2016 International Trade and Customs Conference Export Prospects - - PowerPoint PPT Presentation
2016 International Trade and Customs Conference Export Prospects - - PowerPoint PPT Presentation
2016 International Trade and Customs Conference Export Prospects Eric N. Smith Associate Director Tulane Energy Institute 3-30-16 Global Production, Consumption and Exports Saudi Production: Historically, Saudi production tends to ramp up from
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Global Production, Consumption and Exports
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Saudi Production: Historically, Saudi production tends to ramp up from the beginning of the year into a summer time peak, to adjust for domestic crude burn at power stations and in an effort to maintain crude
- exports. The three year average production increase from January to June is ~300MBbl/d
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1.59 mm bbl./d
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OPEC Monthly Oil Market Report, February, 2016
Demand for OPEC crude is projected to increase by 1.8 mb/d to 31.6 mb/d. 1Q16 and 2Q16 are expected to increase by 1.5 mb/d and 1.7 mb/d, respectively, while 3Q16 and 4Q16 are projected to increase by 2.1 mb/d and 1.6 mb/d.
The Call on OPEC in 2015/16
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$40 95
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9.43 mm bbl./day
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Light/Med Crude dominates in the major basins. Heavier Oil, in Ca.
Limited Heavy Oil Production
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4.5 6.0
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Atmospheric Distillation Unit Vacuum Distillation Unit
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Existing North American Crude Oil Pipelines
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Crude Oil Imports
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Crude Oil
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Crude Oil
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Crude Oil
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Crude Oil
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Crude Oil
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Crude Oil
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PADD 2
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PADD 3
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Refined Product and Crude Oil Exports
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Congestion pricing caused by either infrastructure bottlenecks (pipelines) or government export restrictions leads to domestic prices that are lower than world prices.
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However, the equilibration may take a decade.
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Evidence, the price spread between Brent and WTI is disappearing
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3.8 mm bbl/d 3.3 mm bbl/d 2.7 mm bbl/d 2.2 mm bbl/d .682 mm bbl/d
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ethane has a heat content of 1,770 Btu/cf. propane has a heat content of 2,516 Btu/cf.
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heat Component content % Contribution Methane 1010 96.0% 970 Ethane 1770 3.0% 53 Propane 2516 1.0% 25 Composite for US 1048 Typical Effect of Wet Gas components on Aggregate Heat Content
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U.S.
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One of the eight new bulk Ethane transporters designed to supply INEOS’ converted crackers in Grangemouth, Scotland and Rafines, Norway with Marcellus/Utica Ethane.
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LPG = Propane, Butane, Isobutane, Pentane, and Pentanes +
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Growth across the board but highest in Asia
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Conclusions:
- US is now positioned to export light and medium crude oil, although the US will continue to
remain a large importer of sour heavy crudes.
- Refineries will continue to see high utilization with further modifications to handle increased
light ends and to increase octane in order to convert surplus Naphtha into gasoline for
- export. Naphtha Crackers will not be the preferred route to Ethylene.
- We will continue to export surplus Ethanol.
- Exports of Ethane and Propane will both expand significantly, driven by increasing wet shale
gas production in the US and lack of domestic consumption growth.
- Exports of olefins derived from Ethane and Propane will expand, with added cracker capacity,
and exports of bulk plastic chips derived from olefins will also expand, despite added polymerization capacity.
- Continued conversion of dry natural gas to Methanol will lead to increased exports, for
example to China to feed their Methanol to Olefins (MTO) technology.
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