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02 06, 2020 by Lori LeBlanc for BIC Magazine
The U.S. became a net exporter of crude oil and refined petroleum products in September 2019, exporting 89,000 more barrels per day that month than it imported, according to a recent report from the EIA.
This was the first full month since record-keeping began in 1949 that U.S. exports exceeded imports, a tremendous milestone for a nation well on its way to energy independence. It's an accomplishment that many never would have dreamt of in the 1970s, when we found ourselves at the mercy of unfriendly oil-producing regions to fill our gas tanks and heat our homes.
"This is a very big deal, not just rich in symbolism but marking a major and tangible benefit to the U.S. economy," remarked Daniel Yergin, Pulitzer-winning author of "The Prize," which recounts the history of the oil industry. We at LMOGA couldn't agree more.
Just 10 years ago, the U.S. was importing 10 million more barrels per day of crude oil and petroleum products than it was exporting, and imports were coming from as many as 37 foreign sources each month. Fast-forward to 2019, when the U.S. exported oil and petroleum products to as many as 31 destinations per month, and foreign sources for imports fell to 27 or fewer in any month.
While this contrast over a short 10-year period is astounding, the change did not happen overnight. Key policy initiatives, technological advancements and infrastructure expansions long championed by organizations like LMOGA have helped to fuel this intense domestic oil and gas production activity, and the future looks even brighter.
Congress opened the door to crude oil exports in December 2015 with the passage of an appropriations bill that included a provision to end the export ban on most types of crude oil that had been in place since 1975.
As Sen. Lisa Murkowski (R-Alaska) said before this epic vote, "We need to act before the crude export ban raises problems and hurts American jobs."
Lifting the export ban opened global markets to U.S. oil and gas producers, rejuvenating production, expanding jobs in the oil and gas industry and support businesses, and sending more money to the Treasury. A good deal of the oil and gas production increase has been realized in the shale basins, and the Gulf of Mexico continues to contribute 17 percent of U.S. production totals.
It's not just about producing the oil, however. As an exporter, the U.S. must have a way to transport the crude to foreign customers. That's where the Louisiana Offshore Oil Port (LOOP) comes in. Since 1981, the port's primary purpose has been offloading imported oil from supertankers and transmitting it to storage tanks and caverns before the oil flows by pipeline to refineries across the U.S. One year ago, LOOP began loading crude onto supertankers at its facility, located 18 miles south of Port Fourchon, Louisiana, marking the changing dynamic of our energy economy.
Likewise, pipeline operators Enterprise Products Partners from Houston and Enbridge from Canada have announced plans to develop another Gulf of Mexico offshore crude oil export terminal in the Gulf, 30 miles from the eastern coast of Freeport, Texas.
All of this growth and development leads the EIA to forecast that U.S. net petroleum exports will continue to increase, averaging 751,000 bpd in 2020. Rystad Energy also predicts that last September's net-exporter achievement is just the beginning. According to the energy research firm's projections, by 2030 -- only 10 years from now -- U.S. energy production will outpace domestic energy demand by about 30 percent.
"The emerging energy surplus will make the U.S. less vulnerable to foreign energy-related politics and facilitate growing exports," explained Sindre Knutsson, vice president of gas markets at Rystad Energy.
The future sure is bright, thanks to American-made oil and gas and the men and women who help fuel our nation and the world.
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