Crude Supply Creates Demand for Storage Projects on USGC

WSJ: Newest and Largest Oil Storage Facility Slated for Houston, TX
Salt Dome Storage Facility

Salt Dome Storage Facility | Click to Enlarge

The largest new oil storage facility along the Texas Gulf Coast is slated for Houston, TX, according to the Wall Street Journal (WSJ).

The paper’s blog identified Houston-based Haddington Ventures LLC, a midstream oil and gas investment firm, as the designer/builder for the Pierce Junction crude oil storage project. Currently, the company is seeking a buyer for a majority stake in the project, which has already been designed and is slated for construction in late 2014.

Since 2008, crude inventories from the tight oil and shale gas revolution, have been piling up in Cushing, Oklahoma, a major oil trading and storage hub. However, TransCanada’s Gulf Coast Pipeline, which came online in January of this year, helped significantly reduce inventories in Cushing, but pushed the crude to the U.S. Gulf Coast (USGC) area. As a result, crude inventories in the USGC have recently climbed to record levels according to the Energy Information Administration (EIA), hitting¬†207.2 million bbl on April 11, 2014. The EIA says the USGC region has about 275 million bbls of current capacity, but projections are for total U.S. oil production to continue growing, and more midstream projects pushing oil to the USGC have been scheduled.

Haddington’s Pierce Junction project, which will be in Southwest Houston, will utilize naturally existing salt domes in the area. The way it works is a¬†well is drilled into the formation and large amounts of water are cycled through the well dissolving the salt. The brine is extracted, leaving a large empty space in the formation for storage purposes.

According to WSJ, a Houston investment bank predicts by 2016 projects along the Gulf Coast will accommodate an additional 55-million bbl. The Pierce Junction Project is included in that estimate.


Valero Refinery Expansions Pushed Forward by Eagle Ford Production Growth – $730 Million

Valero Will Spend $730 Million on Two Expansions Along the Gulf Coast
Valero Refinery Map

Valero Refinery Map – Partial | Click to Enlarge

Valero plans to build crude topping units at its Corpus Christi, TX refinery and its refinery in Houston.

The two expansions come with a price tag of $730 million, but will likely be needed if the growth of light-sweet crude oil from areas like the Bakken, Eagle Ford, and Permian Basin continue.

Read more: Valero Houston Refinery Expanding for Eagle Ford Crude [Read more…]

Magellan Midstream Buys West Columbia Pipeline From Shell

The Deal Improves Magellan's Ability to Move Eagle Ford Barrels Effectively
Magellan Houston System Map

Magellan Midstream Houston System Map | Click to Enlarge

Magellan Midstream Partners has acquired a 15-mile, 16-inch Houston area pipeline from Shell. The pipeline is bi-directional, with capacity of 150,000 b/d.

The pipeline moves crude from Genoa Junction to/from a Magellan terminal in East Houston. [Read more…]

Calfrac Acquires Eagle Ford Assets With Mission Well Services Deal – $147 Million

Calfrac Gains Offices In Fairfield, Houston, and San Antonio
Mission Well Services Frac Spread

Mission Well Services Frac Spread | Click to Enlarge

Calfrac Well Services has agreed to acquire Eagle Ford service company Mission Well Services for $147 million.

Mission Well Services is a privately held hydraulic fracturing and coiled tubing service provider in Texas. With the acquisition, Calfrac gains locations in Fairfield, Houston, and San Antonio. [Read more…]

Eagle Ford Shale From Space – Updated NASA Photo

Rig Lights In The Eagle Ford Rival Metro Areas

A new Eagle Ford Shale satellite photo from NASA shows just how many rigs are active in the area.

At the time the photo was taken there were about 260 rigs drilling in the area. Eagle Ford rigs account for almost 15% of all drilling in the U.S.

Eagle Ford From Space

Eagle Ford From Space | Click to Enlarge

[Read more…]

OTC Sheds Light On New Technologies

Statoil Showcased A Remote Welding Device That Can Tie Into Live Pipe
OTC Awards Banquet

OTC Awards Banquet | Courtesy Barchfeld Photography

The Offshore Technology Conference (OTC) has really outgrown its name. While the name indicates an offshore focus, you’ll find companies who service the oil & gas industry in all walks on and off shore. [Read more…]