Higher domestic crude production and US refining
The EIA is reportedly developing a series of analyses that address the implications of current limitations on crude oil exports for prices, including both world and domestic crude oil and petroleum product prices, and for the level of domestic crude oil production and refining activity.
Recent report
The most recent report, ‘Implications of Increasing Light Tight Oil Production for US Refining’ considers how refining activity in the US might respond to low and high scenarios of increasing US light tight oil production. For this the EIA retained Turner, Mason & Company ™ to conduct the analysis using. The analysis considers operational changes and investments in capacity expansion that domestic refiners would likely make to process increasing volumes of light oil. The analysis considers two domestic production scenarios provided to TM by EIA, and two crude oil export policies. The analysis covers 2014 – 2025 and uses 2013 as the base year.
One paring, combining low crude oil production and unrestricted crude oil exports, was considered but ultimately not included in the analysis, as the results were not materially different from those obtained for low crude oil production under current crude oil export restrictions. In all the considered cases, higher domestic crude oil production leads to a decline in crude oil imports, an increase in refinery runs, new investments to expand processing capacity, and higher crude oil and petroleum product exports. However, the magnitude of the changes and the complexity of the new processing units added vary across the scenarios.
While most of the ultimate uses of increased production are similar in the two cases developed using the higher domestic crude oil production path, there is one key difference. Under current policy, where US crude oil exports are restricted, a significant amount of new refining capacity is built. However, if export policy restrictions were relaxed, almost 2.3million bbls of crude oil could be exported by 2025.
Edited from press release by Claira Lloyd
Read the article online at: https://www.hydrocarbonengineering.com/refining/08052015/eia-domestic-crude-and-refining/
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