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Permalink Reply by Skip Peel - Mineral Consultant on August 10, 2015 at 11:04

Although it varies, the US imports about 290,000 barrels of crude a month. About 10,000 barrels a day.  That's not much but it could be less.  The majority of imports, about 67%, come from non-OPEC countries.  Unless you are suggesting the nationalization of the US and Canadian refining industries I don't think you can keep them from buying the best product at the cheapest price available.  OPEC doesn't have the influence in the global crude market that they once enjoyed.  They will face increased competition in the future from countries that develop their own unconventional petroleum reserves.  

http://www.eia.gov/dnav/pet/pet_move_impcus_a2_nus_ep00_im0_mbbl_m.htm

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Permalink Reply by JHH on August 11, 2015 at 13:43

This should have happened years ago.  But "we" haven't been treating our friends very well lately.

We have everything working in our favor.  I hear... when Congress returns... limited oil exports might be approved.  One phase could include sweet crude exports to Mexico for refining... and an equal amount of their more "sour" oil to the U.S. for refining.  Would be an interesting start to a North American energy alliance.

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Permalink Reply by Skip Peel - Mineral Consultant on August 11, 2015 at 13:59

Over 37.5% of US crude imports come from Canada now.  Mexico can barely produce enough for their own domestic needs and that's why their nationalized O&G industry has been opened to foreign investment recently.  Their E&P technology is mid-20th. century.  NG pipelines to connect Texas production to Mexico end users are on the horizon.  There is no panacea to be had in a North American cartel.  Crude will still be priced on the global market and refiners will buy the best fit crude at the cheapest price regardless of country of origin.

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Permalink Reply by jeff on August 12, 2015 at 4:28

Yes I am imagining a panacea. What if our refiners were mandated to purchase and fulfill North American production at 65-75 per barrel. Thus keeping our domestic E&P companies both large and small in a secure business environment. After keeping us happy let them purchase all they want at what ever prices from who ever.

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Permalink Reply by Skip Peel - Mineral Consultant on August 12, 2015 at 4:34

That is called Socialism.  Good luck achieving that panacea.

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Permalink Reply by jeff on August 12, 2015 at 4:51

I didnt want to say it . just dreaming of a better world.

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Permalink Reply by Skip Peel - Mineral Consultant on August 12, 2015 at 4:58

There isn't a better word.

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Permalink Reply by jeff on August 12, 2015 at 5:00

World not word

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Permalink Reply by Skip Peel - Mineral Consultant on August 12, 2015 at 5:03

LOL!  My typo.  I am afraid both are a dream.

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Permalink Reply by Skip Peel - Mineral Consultant on August 13, 2015 at 3:41

San Antonio energy firm to proceed with U.S.-Mexico pipeline

Aug 12, 2015, 8:54am CDT Updated Aug 12, 2015, 11:23am CDT  .bizjournals.com/sanantonio

Howard Energy Partners and Grupo Clisa will proceed with the development of a new cross-border pipeline that will connect Howard’s existing hub in Webb County, Texas, and the Mexican National Pipeline System in Escobedo, Nuevo Leon.

The two companies will build a 200-mile, 30-inch Nueva Era Pipeline that will have the capacity of transporting 600 million cubic feet of natural gas per day to help fuel combined-cycle power plants near Monterrey. Through this pipeline, U.S. producers will be able to supply natural gas directly to Mexico’s electric power industries.

Mexico’s Comision Federal de Electricidad, the government-owned electric power generation compny will be the initial shipper on the pipeline. It has committed to ship 504 million cubic feet of natural gas per day. However, because of the initial interest so far in the pipeline project, Howard will conduct a second open season on the pipeline to gauge whether there is enough business to warrant expanding the size of the pipeline.

Beginning today and lasting through Sept. 15, Howard Energy is soliciting interest from potential shippers in addition to Mexico's CFE. However, Howard already has a permit from the Federal Energy Regulatory Commission that will allow the pipeline capacity to be expanded from 600 million cubic feet up to 1.12 billion cubic feet per day, if needed. Construction on the pipeline will begin early next year. The pipeline should be completed by June 2017.

San Antonio-based Howard Energy Partners owns and operate natural gas gathering and transporting pipelines and related midstream assets. Grupo Clisa is a Mexican business group with expertise in the importing and marketing of natural gas.

 

Permalink Reply by Joe Aldridge on August 13, 2015 at 9:05

Jeff,

The only way I can see something like this happening is a support price or tax on oil that would set the minimum price at $65.00 per barrel. Anything below that price would be taxed at the rate between the then current price and $65. At the current difference in price ($40 and $65) the tax to the Fed would bring in $1 trillion+ per year. That would support the industry with a known price per barrel and provide revenue to the Government. The problem with taxes of this type would be: Is the money being spent wisely?

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Permalink Reply by Skip Peel - Mineral Consultant on August 13, 2015 at 9:17

There is another problem.  The Congress would never pass such a tax.  It would be entertaining to see such a bill introduced just to witness the stammering, obfuscating and indignation from both sides of the isle.

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