CORPUS CHRISTI, Texas — Experts are warning that Corpus Christi is behind on preparations to handle large amounts of oil coming from other parts of the state for export to other countries.
The warnings center on the lack of improvements that will allow for greater and greater volumes of oil as production is increased in the Eagle Ford Shale and pipelines are built from the Permian Basin.
Benjamin Salisbury is the managing director of Wayfinder Analytics, which has released a study showing that Corpus Christi is poised to become a premier U.S. export hub as crude production in the Permian Basin and Eagle Ford Shale accelerates. He said the report found that over the next five years, the supply of oil will grow by 80-percent.
That could mean billions lost by the industry if Texas infrastructure isn't improved.
"It's happening most recently in the Permian, where you don't have the ability to get the oil to the markets in Cushing or the refiners in the Gulf Coast," Salisbury said. "When you look at the price consequences of those bottlenecks, you not only have lost barrels that can't be shipped and the associated lost revenue. You actually have a shut in production where people drill fewer wells, hire fewer crews. So for the Permian region alone, a bottleneck of that magnitude could be $51 billion."
Meanwhile, Texas A&M University-Corpus Christi Economics Professor Dr. Jim Lee said this area is already behind on infrastructure, which could cause a bottleneck that will drive depressed oil prices even lower in the area.
"Obviously if we can't export there's not much to lose, but this is going to continue the depressed oil prices," Lee said. "And obviously gas will stay at the $2 level for the next, at least two years. It might be good for drivers and consumers but definitely not good for Texas. Not good for Corpus Christi."
Port of Corpus Christi officials said they agree. Board Chairman Charlie Zahn spoke with 3News Thursday from Austin, where Port officials are asking for support from State and federal officials to help with infrastructure upgrades.
"One is to deepen and widen our ship channel to accommodate the larger vessels that are going to transport that crude," Zahn said, "and secondly to grow the terminal capable of docking and facilitating the large, the VLCCs, the very large crude carriers that are going to come into the Coastal Bend."
Zahn said the New Harbor Bridge Project is an infrastructure upgrade in itself.
Three new oil pipelines will be built from the Permian Basin to the Coastal Bend. The first of those should be complete in about 18 months and Zahn hopes some of their export upgrades will be ready for as much as 3.3 billion barrels a day leaving Corpus Christi.