Enterprise Products Partners has not received enough customer interest to commercialize its Sea Port Oil Terminal (SPOT) crude export project off the coast of Texas, the CEO of the U.S. pipeline and storage operator, said on Tuesday.
The U.S. is the world’s largest oil producer and among the top exporters to global markets, with crude shipments surging after the country lifted an export ban in 2015. The lack of interest in the project underscores concerns that U.S. production growth is slowing and signals that the country’s export capacity may have peaked.
Enterprise’s SPOT in 2022 became the first of several proposed export terminal projects to receive a license from the U.S. maritime regulator for a deepwater port that could load two supertankers at a time, each of which can carry up to 2 million barrels of oil.
CEO Jim Teague blamed regulatory delays and Russia’s 2022 invasion of Ukraine, which rerouted oil flows, for the lack of interest in the project. He said the company will continue to promote SPOT but would shelve the project if customers do not materialize.
“A lot has changed since we entered our SPOT application in January 2019,” Teague said in an earnings conference call.
“In order to build SPOT, we know what we need is volumes, fees and terms… if we can’t achieve these within a reasonable amount of time, we will move on,” he said.
Forecasters had predicted that U.S. crude exports would climb to between 7 million and 8 million barrels a day by 2024, and that a majority of those would go to Asia on supertankers, Teague said.
U.S. crude exports averaged around 4.1 million barrels in the first 11 months of 2024, data from the Energy Information Administration showed.
U.S. Gulf Coast ports have a maximum crude export capacity of about 6 million barrels per day, according to ship tracking firm Kpler, though the actual figure is likely lower due to maintenance requirements and unforeseen disruptions.
Changing Oil Flows
About 47% of U.S. crude exports went to Europe last year, according to Kpler data, as Russia’s invasion of Ukraine led to higher demand from Europe. Asia’s share of U.S. crude exports declined to 38% in 2024 from 43% in 2019.
Crude to Europe can be shipped economically in smaller tankers, while increased demand from Asia would have led to higher usage of supertankers, the type that SPOT targeted for its project.
Flows of oil could shift again this year after a U.S. official said President Donald Trump would sign a presidential memorandum on Tuesday to restore his “maximum pressure” campaign on Iran to stop the country getting a nuclear weapon and drive down its oil exports to zero.
Trump has also laid out a sweeping plan to maximize U.S. oil and gas production and speed permitting by declaring a national energy emergency.
“I got to see it to believe that, frankly,” Enterprise’s Teague said when asked about how Trump’s permitting reform would impact the company’s growth strategy.
The company’s adjusted earnings before interest, tax, depreciation and amortization rose 4% to $2.6 billion in the three months to Dec. 31, helped by a rise in natural gas liquids pipeline transportation volumes.
Enterprise shares were down 0.9% at $32.82 in midday trading.
