As Permian Basin oil manufacturing rises, so does the manufacturing of pure fuel related to that crude, filling the area’s pipelines.
Producers searching for a house for all that manufacturing are turning their sights on worldwide markets. And with nearly 2 billion cubic ft of pure fuel discovering its means from Permian Basin oil fields to Mexico, West Texas eyes are on our neighbor to the south. Mexico at the moment is the vacation spot for about 71% of US pure fuel pipeline exports.
Hoping to fill a part of Mexico’s demand for US pure fuel is ONEOK, whose subsidiary Saguaro Connector Pipeline has filed a presidential allow software with the Federal Vitality Regulatory Fee (FERC) to assemble and function services for the exportation of pure fuel at a brand new worldwide border-crossing on the U.S. and Mexico border in Hudspeth County.
The proposed border services would join upstream with a possible intrastate pure fuel pipeline, the Saguaro Connector Pipeline, which might be designed to move pure fuel from ONEOK’s current WesTex intrastate pure fuel pipeline system within the Permian Basin in West Texas to Mexico. Moreover, the proposed border services would join on the Worldwide Boundary with a brand new pipeline underneath improvement in Mexico for supply to an export facility on the west coast of Mexico.
The potential Saguaro Connector Pipeline would consist of roughly 155 miles of 48-inch-diameter pure fuel pipeline originating on the Waha Hub in Pecos County. The last word design capability of the potential pipeline could be roughly 2.8 billion cubic ft per day. Closing funding choice on the potential pipeline is predicted by mid-2023.
James Taylor, senior vitality analyst at East Daley Analytics, advised the Reporter-Telegram by e mail that ONEOK’s announcement was considerably stunning.
“Though there are a number of deliberate LNG services slated to be constructed on Mexico’s Pacific Coast and the probably supply for all that offer could be the Permian Basin, ONEOK has not specified which facility(s) they plan to provide and the pipeline on the Mexico aspect of the boarder nonetheless must be accredited and constructed. Solely Sempra’s Costa Azul LNG facility has been sanctioned,” he wrote. Which means, he added, that it will likely be a while earlier than the challenge is full.
Nonetheless, Taylor wrote, “if all of the LNG involves fruition, it might present a welcome vacation spot for Permian fuel and assist stability out (value) foundation versus Henry Hub.”