Condensate causes confusion

US officials told Iran’s crude buyers – China, Iran, Japan, South Korea, Turkey and Taiwan – that Washington would not object to monthly fluctuations in purchases of Iranian oil, as long as the average over the six month period represented no increased from the 1 million – 1.1 million bpd before the six month nuclear agreement between the US and Iran was reached.

The agreement covered only crude, not condensate. However, Amos Hochstein, deputy assistant secretary of state for energy diplomacy, told a subcommittee of the US House of Representatives’ Foreign Affairs Committee that Iranian import data may include shipments of condensate and other products.

In differentiating between condensate and crude, the State Department has adopted a markedly different approach from the US Commerce Department, which defines condensate as crude when enforcing the US’ own oil export restrictions.

Some lawmakers were surprised to learn that the US administration is distinguishing between crude and condensate when calculating allowable Iranian oil exports: “In determining whether or not they are violating sanctions law, we use their definition instead of our own”, representative Ted Deutch said.

Senate Energy and Natural Resources Committee ranking Republican Lisa Murkowski (Alaska) has been encouraging the US administration to ease the restrictions on condensate exports, arguing that condensate is chemically unlike crude. Hochstein’s comments appear to give support to Murkowski’s argument.

A Murkowski spokesperson said: “This distinction is certainly ironic and highlights how the US renaissance in hydrocarbon production has outpaced our energy policies”.

Adapted from a press release by Emma McAleavey.

Read the article online at: https://www.hydrocarbonengineering.com/gas-processing/16062014/condensate_confusion_717/