HOUSTON Aug 7 Plains All American
executives on Thursday stopped short of saying the company is
seeking a ruling from the U.S. government on whether Plains can
export a very light form of crude oil with minimal processing,
but said they'll be ready to do so.
Harry Pefanis, chief operating officer for Plains, told
analysts the company was "trying to get clarity" on what
processing is necessary for condensate to be excluded from the
decades-old U.S. crude export ban.
"We are certainly positioning ourselves to be able to move
condensate on our system and across our assets and into the
export market if the stabilization at Gardendale is sufficient
so the condensate wouldn't be subject to the export ban,"
Pefanis said during the company's quarterly earnings call.
Two other companies in March received approval from the U.S.
Department of Commerce to export lightly processed condensate,
saying that running it through a stabilizer to remove natural
gas liquids and other contaminants.
Before that, the industry believed crude and condensate
needed more sophisticated processing to qualify as an exportable
product, such as being run through a condensate splitter that
makes distillates and naphtha or a refinery that makes finished
Now the Commerce Department has put on hold several requests
for approval to export minimally processed condensate.
When an analyst on Thursday asked if Plains had applied for
a ruling from the Commerce Department, Chief Executive Greg
Armstrong declined comment.
But earlier, another analyst said: "There's no reason to
think your volumes wouldn't be eligible to be exported, but you
still have to go through the process to figure that out. Is that
a correct statement?"
Armstrong replied, "Yes. The only thing that may get in our
way is political arbitrariness."
Plains has an 80,000 barrels-per-day (bpd) condensate
stabilizer in Gardendale, Texas, that is being expanded to
120,000 bpd. That stabilizer's output can move to Corpus Christi
or Houston via pipelines that are joint ventures with Enterprise
Products Partners, one of the companies that received an
approval from the Commerce Department.
Plains' 310-mile, 200,000 bpd Cactus pipeline, slated to
start up in April next year, can move typical light crude, sour
crude and condensate from the Permian Basin in Texas - in
separate batches - to Gardendale, where it could enter the
(Reporting By Kristen Hays; editing by Gunna Dickson)