Texas expansion will make ExxonMobil US refinery leader, ACC testifies for potential US-UK trade agreement, US to export more energy than it imports by 2020
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Expansion to Beaumont refinery will make ExxonMobil refinery leader in the US
ExxonMobil began construction to a third crude unit at its refinery in Beaumont, Texas on January 29 after reaching a final investment decision on its expansion.
The expansion, expected to start up in 2022, will increase the refining capacity at the site by 65% or 250,000 bbl/day, the company said.
Exxon Mobil previously announced that it was planning for the additional unit, which will allow it to process light crude. Most of the refineries on the U.S. Gulf Coast process heavy crude.
But light crude is flowing from the Permian Basin in West Texas at a rapid pace.
“With access to terminals, railways, pipelines and waterways nearby, the Beaumont refinery is strategically positioned to benefit from Permian production growth,” said Bryan Milton, president of ExxonMobil Fuels and Lubricants.
ACC testifies on US chemicals industry priorities for potential U.S.-UK Trade Agreement
A new trade agreement could eliminate tariffs on $5.7 billion in two-way chemicals trade, reduce costs and create efficiencies through greater regulatory cooperation, the American Chemistry Council (ACC) said.
The ACC shared the U.S. chemical industry’s recommendations for a successful trade agreement with the United Kingdom (UK) should the UK be eligible to negotiate a trade deal following its scheduled withdrawal from the European Union in March.
The UK, a longtime trading partner to U.S. chemicals manufacturers, imported $2.8 billion in U.S. chemicals in 2017 and serves as a regional hub for the globally integrated and efficient chemicals manufacturing supply chain. As evidence of that integration, a significant portion of the $5.7 billion in U.S.-UK chemicals trade is to related parties – 54% of chemical imports from the UK, and 39% of chemical exports.
“A trade agreement that eliminates U.S. tariffs on chemical imports from the UK could save U.S. chemical manufacturers $88 million per year,” Ed Brzytwa, ACC director of international trade, said in testimony before interagency officials at the Office of the United States Trade Representative (USTR). “Eliminating UK tariffs on chemical imports from the U.S. would reduce tariffs paid in the U.K by $84 million. The cost savings from the elimination of tariffs would help boost economic and job growth.”
Brzytwa also encouraged U.S. officials to work to eliminate the Section 232 tariffs on steel and aluminum imports from the UK. “Any potential UK retaliatory tariffs targeting chemicals would limit the ability of U.S. chemical manufacturers to access the UK market,” Brzytwa said. “We also urge both countries to avoid imposing quotas of any kind on imports of UK steel and aluminum, which would impede the construction of chemical manufacturing plants in the United States.”
Earlier in January, ACC filed public comments which outlined several of its member companies’ priorities for a trade agreement with the UK.
One of ACC’s stated priorities is to build on progress already made in talks related to regulatory cooperation during the Transatlantic Trade and Investment Partnership (TTIP) negotiations. “The goal of regulatory cooperation is to explore opportunities for creating efficiencies within and between regulatory systems while maintaining high levels of protection for human health and the environment,” Brzytwa said. “Regulatory cooperation should not undermine or weaken regulatory mandates. Rather, it can help to ensure that those mandates do not result in unnecessary barriers to trade.”
Brzytwa concluded his testimony with a call to both the U.S. and UK governments to work together to address trade-distorting practices by other countries. “ACC and its members stand ready to assist the Administration in the creation of a coalition of allies in the WTO to protect and enforce WTO trading principles around the globe.”
The US will export more energy than it imports by 2020
The U.S. Energy Information Administration (EIA) projects that, for the first time since the 1950s, the U.S. will export more energy than it imports by 2020 as increases in crude oil, natural gas, and natural gas plant liquids production outpace growth in U.S. energy consumption.
The United States has been a net exporter of coal and coke for decades and began exporting more natural gas than it imports in 2017 and is projected to export more petroleum and other liquids than it imports by 2020.
The U.S. has imported more energy than it exports on an annual basis since 1953, when trade volumes were much smaller.
Since then, when imports of energy totaled 2.3 quadrillion British thermal units (Btu), gross energy imports generally grew, reaching a peak of 35 quadrillion Btu in 2005. Gross energy exports were as low as 4 quadrillion Btu as recently as 2002 but have since risen to more than 20 quadrillion Btu in 2018, largely because of changes in liquid fuels and natural gas trade.
EIA’s projected changes in net energy trade are driven mostly by evolving trade flows of liquid fuels and natural gas.