So Many Stories On So Many Levels -- July 30, 2019

Updates

August 4, 2019: Permian doesn't look so hot as producers hit snags -- Bloomberg.

• Concho plunges after being forced to slow down oil production
• "This is a big event for the sector."
• the 23 wells that make up Concho's "Dominator" project in the Permian Basin were spaced too closely, and production will have to slow to avoid overshooting budgets

August 3, 2019: the "University of Houston Energy White Papers" are linked here. The most recent one, dated 02.2019, "Opportunities and Challenges" in the Permian" will download as a pdf. I haven't been able to "catch" its URL, although I assume it can be done (I've done it numerous times in similar situations).

The white paper is superb. It's a keeper.

I had not heard of the "Marfa Basin" or the "Marfa Sub-Basin" before (or if I had, I had forgotten). It looks like the one of the earlier references to the "Marfa Basin" was back in 2010 by Drilling Info. Science and Technology, 2019, also references the "Marfa Basin."

I've added "Marfa Basin" to the sidebar at the right (which will bring it back to this post).

On another note, a cheesy, cheesy link, but for the archives. I don't want to lose this particular link.

Original Post 

This really is incredible, the headline, from Rigzone: "Permian output is getting unwieldy for Gulf Coast ports."

Despite all the growth in Gulf Coast infrastructure ...

A new study from the University of Houston (UH) concludes that U.S. refiners and other domestic customers will be unable to absorb growing Permian Basin production.

It also finds most Gulf Coast ports are not ready to handle the largest – and most cost-effective – ships for exporting crude oil.

Prepared by UH Energy and the UH Department of Industrial Engineering, the study finds that the Port of Houston likely will be unable to handle very large crude carriers (VLCCs). UH researchers cite the relatively shallow depth of the Houston Ship Channel and air quality considerations as key limitations to introducing VLCCs at the port.

UH also noted that the Port of Corpus Christi – destination for much export-bound Permian crude – is expanding and adding VLCC handling capabilities. Currently, the only Gulf Coast port that can fully load VLCCs is the Louisiana Offshore Oil Port (LOOP), the university added.

The authors maintain that delays in expanding export capacity will slow Permian production – a particularly burdensome development for independents, who already face pressure from the majors’ expanding operations there.

This, of course, also has huge implications for the Bakken. 

Huge implications for:

• the US; 
• for Europe;
• for Saudi Arabia;
• for China.

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