NEW YORK - The Louisiana Offshore Oil Port is soliciting offers to build additional oil storage, Dale Rollins, vice president of business development for LOOP, said on Dec. 8.
"LOOP in the future will start another project to expand its tank farm," Rollins said in an online seminar introducing the New York Mercantile Exchange's new sour crude futures contract, which uses LOOP as its delivery point.
LOOP is the largest private storage facility in the U.S. with 53 million barrels of underground storage through eight caverns. It also has an above-ground tank farm that can hold 7.2 million barrels. Rollins said LOOP is considering the construction of further tanks.
"We have been talking to people over the past couple of months to see if there is additional interest for people needing their own tankage," Barb Hestermann, business development representative for LOOP, told Dow Jones Newswires.
CME Group Inc. (CME), which owns Nymex, launched a sour crude futures contract on Dec. 7, initially aimed at capturing the needs of Saudi Arabia's customers. The kingdom in October decided to switch to pricing oil sold in the U.S. off of a sour crude benchmark, rather than an assessment of the Nymex's light, sweet futures contract. Sour is an oil industry term used to denote lower-quality crude.
Hestermann said LOOP had been contemplating new storage prior to the introduction of the new sour futures contract, with fresh interest generated by the launch.
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