Late last year, the federal government quietly approved the Sea Point Oil Terminal (SPOT), to be constructed 35 miles off the coast of Freeport, Texas, in the Gulf of Mexico not far from Galveston Bay. The facility, once completed, would be able to export up to two million barrels of oil per day, making it the largest oil export terminal in the country and increasing export potential by around a quarter of what the U.S. currently exports.
The approval marks the beginning of what could be a wave of five massive new deepwater oil export terminals along the Gulf Coast that service Very Large Crude Carriers, which are over 1,000 feet in length and can carry as much as two billion barrels of crude oil. The terminals aim to take advantage of the U.S.’s new role as a global leader in oil exports.
In the eight years since Congress lifted a long-time ban on crude oil exports, the United States has gone from barely exporting any fossil fuels to offloading millions of barrels of oil per day produced from a growing network of shale oil fields opened up by hydraulic fracturing. In 2021, the U.S. exported 8.5 million barrels of oil per day, and was a net petroleum exporter for the second year in a row for the first time since at least 1949. Due to the logistics of the oil trade, the U.S. still imports nearly as much crude as it exports, but the demand for U.S. crude oil abroad continues to accelerate.
A joint venture between three companies – Enterprise, Enbridge and Chevron – the Sea Point Oil Terminal is one of five offshore oil terminals proposed for waters off Texas or Louisiana, though it is the only one so far fully approved. The four other proposed deepwater oil terminals are the Texas GulfLink Deepwater Port (with a capacity of one million barrels per day), the Blue Marlin Offshore Port (1.9 million barrels per day), the Bluewater SPM Deepwater Port (1.9 million barrels per day), and the Harbor Island Marine Terminal (1.2 million barrels per day).The cumulative impact of these terminals would be an added export capacity of 8 million barrels of crude per day, 319 miles of new oil pipeline, and the construction of seven new support facilities to store and process the crude.
Whether U.S. oil refineries could live up to all this additional export capacity is not a sure thing. In 2022, President Biden urged oil and gas companies to increase production. However, U.S. refinery capacity at the beginning of 2022 was 17.9 million barrels per day, the lowest it’s been since 2014. While some facilities are restarting or adding new refining capacity, these additions are more than offset by closures and conversions. The Alliance Refinery in Louisiana ceased operations following flooding caused by Hurricane Ida and has been converted into a crude oil terminal. Shell’s Convent Refinery, also in Louisiana, was shuttered in 2020 and the company recently announced plans to convert it into an alternative fuels complex. Other refineries like Northern California’s Rodeo Refinery are converting to “renewable” diesel and other fuels production.
Oil and gas companies blame Biden for high prices, and say they cannot add refinery capacity because it is too expensive .However, these export terminals and associated pipelines and facilities cost huge sums. The Harbor Island Marine Terminal is estimated to cost $1 billion, and the Enbridge Ingleside Energy Center, an export terminal in Ingleside, Texas, was acquired by Enbridge for $3 billion in 2021. Despite the oil and gas industry’s desire to paint Biden as the cause of high gas prices and any financial woes, these companies continue to make huge profits and invest inexpensive new projects that will not increase oil availability in the U.S. directly.
In its approval of the Sea Point Oil Terminal in November 2022, the Maritime Administration, a wing of the U.S. Department of Transportation, referenced the increased demand for oil and gas from “allies” in the event of a market disruption, which can only be assumed to refer to Russia’s war in Ukraine and subsequent threats to the geopolitical energy landscape. In the decision, the agency states that the “construction and operation of the Port is in the national interest because the Port will provide a reliable source of crude oil to U.S. allies in the event of market disruption,” and “will benefit employment, economic growth, and U.S. energy infrastructure resilience and security.”
Joanie Steinhaus, Gulf Program Director for the Turtle Island Restoration Network, said the Sea Port Oil Terminal is simply not in the national interest.
“The Biden Administration has sold their soul to the industry and the big excuse is the war in Ukraine,” Steinhaus said. “It is nothing more than an excuse, and Biden needs to remember the climate crisis we are in and what this means for the future of our planet. ”
Steinhaus said the Biden Administration, as it reviewed and approved SPOT, failed to properly analyze the air emissions from loading vessels, the total volume of greenhouse gas pollution, and the likely harm from an increase in smog in the region.
In January, the Turtle Island Restoration Network and five other environmental and community groups sued the U.S. Department of Transportation over its approval of the Sea Port Oil Terminal, saying Maritime Administration didn’t “adequately assess the devastating oil-spill risk and species harms from SPOT’s construction and operation.”
The agency is accused of ignoring “new information about risks to Rice’s whales, among the most endangered marine mammals on Earth, with a population of fewer than 50 individuals exclusively inhabiting the Gulf of Mexico. ... Experts predict that SPOT will cause hundreds of oil spills during the project’s lifetime, which, along with increased vessel traffic and noise activities, could lead to the species’ extinction.”
The construction of SPOT would also include around 168 miles of land-based and underwater pipelines and an expansion at the existing Enterprise Crude Houston (ECHO) Terminal, as well as a new onshore oil storage facility known as the Oyster Creek Terminal. This would include seven above-ground storage tanks each capable of holding 685,000 barrels of oil, for a total storage capacity of 4.8 million barrels. Enbridge recently announced plans to build another crude oil terminal in Freeport, Texas, the Enbridge Houston Oil Terminal (EHOT), which would be able to store up to 15 million barrels of oil once fully built and would eventually connect to the SPOT deepwater port.
Lauren Parker, an attorney at the Center for Biological Diversity’s Climate Law Institute involved with the lawsuit, said one of the most concerning elements of SPOT’s construction is the harm it will pose to residents along the Gulf and in Brazoria County specifically, who are already overburdened with oil and gas infrastructure. In October 2022, the EPA reclassified the eight-county Houston-Galveston-Brazoria area as going from serious to severe nonattainment regarding federal ozone pollution requirements.
“The Maritime Administration needs to revisit this decision because the Biden Administration has committed itself to tackling environmental justice and climate change,” Parker said. “By allowing SPOT to move forward Biden is clearly jeopardizing his credibility as a global climate leader. Even with the rosiest projections for emission reductions offered by the Inflation Reduction Act, which is the administration’s biggest claimed climate victory to date, the U.S. is not on track to meet our national climate targets.”
Enterprise Products promotes SPOT by claiming it will provide safe and reliable long-term crude oil export services to the global market with a reduction in spill risk. Currently, four to eight smaller ships are required to load Very Large Crude Carrier oil tankers that arrive in the Gulf of Mexico, which increases the risk of spillage, according to the company. The company also argues that SPOT will also have a vapor control system that will “reduce crude vapor emissions from the loading activity by more than 95 percent.”
More than 44,000 people spoke out against SPOT’s construction during the Maritime Administration’s public comment period in 2021. Freeport resident Melanie Oldham, founder of Citizens for Clean Air & Water in Brazoria County, and three other activists were arrested in Washington, D.C., in November 2022 after staging a sit-in at the Department of Transportation in anticipation of the Maritime Administration’s decision on the terminal.
“We’re asking President Biden and Transportation Secretary Pete Buttigieg to step up and be climate leaders and not approve this oil export project,” said Oldham. “We hope they practice what they preach, what they told us in their campaigns.”
EIP Research Analyst Lottie Mitchell performed data analysis and records research for this report.
Lead photo: The crude oil tanker Hakata. Photo by Piet Sinke.