The Port of Corpus Christi said it is one step closer to cementing itself as the oil-export leader in the U.S. with Friday's Phillips 66/Trafigura announcement to join forces in an offshore deepwater port project.
Phillips 66 and the Trafigura group, two companies who at one time had proposed similar Very Large Crude Carrier (VLCC) projects in the area, said Friday they have formed a joint venture to build two single-point mooring buoys approximately 21 nautical miles east of the entrance to the Port of Corpus Christi.
Port of Corpus Christi CEO Sean Strawbridge estimates the venture, which would allow for the loading of crude oil, could deposit $40 million to $50 million a year into the local economy.
"As the leading export of energy from the U.S., this type of announcement continues to propel our growth and solidify our position as the energy port of the Americas," Strawbridge said.
The port said its role is to provide oversight to the project, called Bluewater Texas Terminal LLC, ensuring it runs an "environmentally sustainable infrastructure" and leasing land and rights-of-way.
"All facilities will be in federal waters," Strawbridge said. "However, the Bluewater Texas Terminal facility that Phillips 66 and Trafigura have announced will be connected back to the Port of Corpus Christi and land we will be leasing to them."
Just a year ago, Trafigura proposed to independently create an identical project. The Port vehemently opposed it, going as far as to request the Corpus Christi City Council pass a resolution in opposition.
Trafigura proposed to build its VLCC terminal in the Gulf of Mexico off of the portion of Padre Island National Seashore in Kleberg County. It would have been located 12 miles offshore, in federal waters and away from Texas regulation.
The port came out in support of Phillips 66's similar proposed independent project, though, a move McComb questioned because he said the projects sounded similar to him.
“I don't want us to think that we were manipulated into a position of opposition, not necessarily for the right reasons,” said McComb in July 2019.
The port cited air quality and other environmental concerns as key differences between the two projects.
But now that Trafigura has partnered with Phillips 66, it's a proposal the port is willing to stand behind.
"I think the distinction between the proposed project they had, and now -- them joining forces with Phillips 66 -- is really about the responsible operations that Phillips 66 brings to the market," Strawbridge said.
Crude oil currently sits at $50 a barrel, which could mean $15 billion worth of exports for the port. The project currently is awaiting a license from the U.S. Department of Transportation's Marine Administration (MARAD) to move forward. The application could take another four to six months to review.
"One of the reasons why the buoys are coming to fruition is because coastal conditions can't keep up with demand," Strawbridge said.