As the U.S. oil boom shows no signs of slowing down in the near future, two Texas companies have received approval to ship unrefined oil to overseas buyers, potentially opening the door for expanded oil exports.
The Wall Street Journal reports that the U.S. Department of Commerce’s Bureau of Industry and Security issued separate private rulings allowing Irving-based Pioneer Natural Resources Co. (NYSE: PXD) and Houston-based Enterprise Products Partners LP (NYSE: EPD) export a type of ultralight oil known as condensate, which could begin as soon as August.
Although the rulings only apply to the two companies and the Commerce Department said there has been “no change in policy on crude oil exports,” the department is “working on industrywide guidelines that could make it even easier for companies to sell U.S. oil abroad,” the WSJ reports.
As a result of the exploding U.S. oil output, producers have been lobbying Washington to strike down the decades-old oil export ban, which restricts most exports of crude oil. Oil producers say lifting the ban would continue to boost domestic production and help create hundreds of thousands of new jobs. However, supporters of the ban say ending it would drive up U.S. gas prices for consumers.
Even with the ban in place, U.S. crude exports recently reached their highest level in 15 years, according to a federal analysis. Most of the exports went to Canada.
The increase in crude exports is largely the result of rising U.S. production, which reached 8.2 million barrels per day in March. South Texas’ Eagle Ford Shale reached the 1 million barrel-per-day milestone in October and could be on track to double its output by 2020.
Enterprise and Pioneer applied to export processed condensate from the Eagle Ford, the WSJ reports.
Enterprise is the Houston area’s third-largest public company based on revenue, according to Houston Business Journal research.
Article and Image sourced from bizjournals.com June 26th, 2014.