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US will drive growth for oil storage industry in North America

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The US will drive most of the growth in oil storage industry in North America between 2018 and 2022, according to and analytics company, GlobalData.

US will drive growth for oil storage industry in North America

The country is set to add more oil storage capacity than any other country in the region during the outlook period.

GlobalData’s report, 'Oil Storage Industry Outlook in North America to 2022' shows that in 2017, North America had an oil storage capacity of 363 715 200 m3 and accounts for 27% of the total global oil storage capacity. The largest oil storage terminals of North America are Freeport V, West Hackberry and Big Hill, all located in the US.

North America is expected to have a total planned storage capacity of 9 072 300 m3 by 2022, and will account for 13.3% of the total global planned storage capacity. The region's storage capacity would therefore reach 376 948 100 m3 in 2022 at an average annual growth rate (AAGR) of 0.7%.

North America is expected to have estimated capital expenditure (CAPEX) of US$7.2 billion on new build projects, of which approximately 83% will be spent by the US and the remaining by Canada and Mexico, during the outlook period 2018 to 2022.

Among countries in North America, the US leads both in terms of capacity additions and CAPEX on new build oil storage projects. The US has planned investment of around US$5.9 billion to increase its storage capacity in the outlook period. The country’s oil storage capacity is expected to increase from 344 950 200 m3 in 2017 to 354 058 500 m3 in 2022 at an AAGR of 0.5%.

Soorya Tejomoortula, Oil & Gas Analyst at GlobalData, explains: “The US is ramping up its crude oil storage capacity to export growing shale and tight oil production. Many of these new terminals have been planned along the US Gulf Coast, mainly for exports to international customers.”

GlobalData identifies Canada as the second highest in North America in terms of capacity additions, and CAPEX on new build oil storage projects. Canada has a CAPEX of US$750 million on new build projects to increase the storage capacity from 18 170 600 m3 in 2017 to 21 583 800 m3 in 2022 at an AAGR of 3.4%.

Tejomoortula adds: “Growing crude production in Canada has resulted in complete utilisation of storage and pipeline capacities. New oil storage terminals have been planned in the country to cater to the demand of the domestic oil producers.”

Mexico accounts for roughly 6% of the region’s CAPEX on new build oil projects during the outlook period. The country will spend an aggregate amount of US$470 million on new build oil storage terminals during the outlook period. Mexico’s storage capacity is expected to increase by 711 000 m3 from 594 300 m3 in 2017 to 1 305 800 m3 in 2022 at an AAGR of 15.7%.

In terms of CAPEX, Pasadena VI, Guernsey III, and St. Landry Parish terminals in the US are the top planned oil storage terminals in North America for the outlook period. In terms of capacity, St. Landry Parish, Pasadena VI and Canada's Hardisty VI terminal will be the top three planned oil storage terminals by 2022.

Read the article online at: https://www.tanksterminals.com/storage-tanks/29082018/us-will-drive-growth-oil-storage-industry-north-america/

 

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