U.S. Crude Exports 3.7 million barrels/day. Only limited by VLCC Export Terminals.

[Jabbar + 465]

Week ending 18 October set an average daily crude oil export record just shy of 3.7 million barrels a day (3.683). 

No shortage of oil. Last week Chevron CEO Michael "Boom Boom" Wirth stated he was confident of DECADES of booming shale production.  

Those heralding the demise of U.S. shale would be wise not to confuse a pause or transition period for a decline. One would have thought the consolidation would have been completed by now.  It now looks like 2020 will be the year of consolidation.  

U.S. only has one offshore VLCC Export terminal. At least three of the 9 vying for viability will be built ( Trafigura, Phillips, Enterprise Products). Carlyle withdrew from Corpus Christi project after they failed to get approval to deepen channel to 75 ft.  Channel will be deepen to 54 ft which does not cut it.

An off shore terminal can load a 2 million barrel VLCC on 24 hours.  Today's land export terminal use reverse lightering to load VLCC that can take 10 days.  The question is what is the U.S. crude export terminal capacity .  The soonest offshore terminals best case online by 2022.

Another interesting tidbit.  WSJ article described new mini bonds derivatives.  These bonds are issued to shale companies for a specific well or group of wells.  The covenants state that the bond issuers are paid first from well production.  The drillers must use the latest reserve mapping, resevoir engineering and completion technology. Along the same idea their are small shale drilling companies startups that now have access and use the latest technology that will take on projects with similar terms.  They get first payment.  Looks to be working.

 

 

Edited October 26, 2019 by Jabbar

[El Nikko + 2,145]

It's not going to die off but it wouldn't hurt if the wall street types that fancy having a go in an industry they don't know about to clear off a bit, other wise it will be a continued boom and bust. It does seem like investors that like to ride the wave of the next big thing are leaving shale which is good news for everyone.

[Jabbar + 465]

29 minutes ago, El Nikko said:

It's not going to die off but it wouldn't hurt if the wall street types that fancy having a go in an industry they don't know about to clear off a bit, other wise it will be a continued boom and bust. It does seem like investors that like to ride the wave of the next big thing are leaving shale which is good news for everyone.

It's will pause or maybe even plateau for a while. Lack of VLCC Export terminals could provide a reprieve for OPEC depending on export capacity available now.  

Remember when the shale Boom first started the U.S. economy and stock market were struggling.  The shale boom was the only bright spot around for jobs and investment. Their big mistake was they believed oil prices would be 100 dollar plus forever.  It wasn't just Wallstreet that believed this the Oil Majors,OPEC and 95% of the "experts" believed the same thing.

Some still believe we will go back to 85 dollar to 100 dollar oil price. 

Will not happen unless Mideast war.

Edited October 26, 2019 by Jabbar