Enterprise Product Partners LP is looking to sell a year’s supply of U.S. ultra-light oil to the global market, signaling another challenge for OPEC as it contends with the U.S. shale boom.
The company in Texas is offering to export 600,000 barrels a month of condensate from March, according to a tender document obtained by Bloomberg News. Enterprise received government approval in 2014 to ship the lightly processed oil from U.S. shale formations. Rick Rainey, a Houston-based spokesman, didn’t respond to calls or an e-mail seeking comment.
The Obama administration last month signaled that companies can legally export stabilized condensate without government approval, a move that Citigroup Inc. said may encourage shale drilling and thwart Saudi Arabia’s strategy to curb U.S. production. With American companies pumping at the fastest rate in more than three decades, members of the Organization of Petroleum Exporting Countries are maintaining output to defend market share.
“The supply situation for U.S. condensate won’t change dramatically,” Ken Hasegawa, an energy trading manager at Newedge Group in Tokyo, said by phone. “They will continue to bring more cargoes into Asia. There’s a comparatively bigger pool of buyers here.”
The U.S. produced 9.19 million barrels a day through Jan. 9, the most in weekly records dating back to January 1983, according to the Energy Information Administration. The nation’s oil boom has been driven by a combination of horizontal drilling and hydraulic fracturing, or fracking, which has unlocked shale formations from Texas to North Dakota.