The maximum capacity of crude storage at Cushing, Okla, has increased significantly in the past year, and more new capacities will come onstream over the next few years.
Total pumpable capacity at Cushing was raised to around 42-43 million bbl from an estimated volume of 35-39 million bbl a year ago.
The Energy Information Administration does not collect official data on terminal storage capacities at Cushing, but the federal agency is making plans to begin its own survey soon, sources close to EIA said. It is unclear when the survey will take place and when the results would be published.
The pumpable capacity at Cushing is significantly lower than the maximum capacity.
The maximum nameplate capacity at Cushing is pegged at 51.9 million bbl, but the actual available storage space is pegged around 48 million bbl due to safe fill and unpumpable bottom limits. The space used for actual oil storage could be even lower because some tanks are reserved for crude blending.
This would mean the near-record high Cushing crude inventory has a lot more space to cover before reaching tank-top.
Cushing crude inventory rose for four consecutive weeks to just 109,000 bbl off the all-time high of 37.945 million bbl set in mid-May. The push behind the crude storage increase is relatively lucrative contango play, backed by favorable financial economics such as low interest rates, bank term interest rate play and financial players happy to collect profits from rolling long positions to the next month.
The increasing storage volume has nothing to do with the market fundamentals, which support criticism of a disconnected NYMEX WTI price.
As of July, Enbridge has 14.8 million bbl of crude storage space at Cushing, Plains 14.2 million bbl, Magellan 7.8 million bbl, Blue Knight 6.7 million bbl, SemGroup 4.2 million bbl, Enterprise 3.1 million bbl, ConocoPhillips 0.8 million bbl and Sunoco 0.3 million bbl.
An estimated 8-10 million bbl worth of new capacities are expected to come onstream over the next few years.
“This (Cushing storage) is a growth industry,” a source said.