Gulf Coast Refineries Supported by Eagle Ford Crude

Gulf Coast refineries are increasing margins as they absorb more domestic crude from the Eagle Ford Shale. Lighter crudes and condensates produced in the Eagle Ford directly offset imports to the Gulf Coast Region. For those counting, that means more jobs in the U.S.

Light crude can be refined into products more easily than many of the heavy crudes imported from South America. Easier means cheaper, which in turn makes Gulf Coast refineries more competitive on a global basis. If you’ve missed the past few years, owning a refinery hasn’t been the best of the business world. Production expectations from shales and a lighter crude slate look to be shifting the winds for refineries. 

The booming Eagle Ford shale deposits in southeast Texas offer regional refiners the opportunity to whip up a crude cocktail cheaper than imported and domestic offshore competition.

The cost benefits will get even better when new pipelines enter service that will bypass current bottlenecks and give refiners access to surging supplies of cheap crude from North Dakota and Canada.

Shale oil from the Eagle Ford deposit in southeast Texas has come on strong this year, rising to 272,000 barrels per day (bpd) in June from 70,000 bpd in April, according to energy consultancy Bentek. Some experts say it could top 400,000 bpd by 2013, enough to virtually back out all the region’s imports from Nigeria.

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R.T. Dukes

R.T. Dukes

Managing Editor at
R.T. is the managing editor of In prior roles, he advised major oil companies on strategy, the macro business environment, and opportunity screening. 2503 Robinhood, Houston, TX, 77005, U.S.A. | Telephone: 832.429.4790

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