WWL>Topics>>7-5-14 12pm, Garland, Worldwide Oil Sales

7-5-14 12pm, Garland, Worldwide Oil Sales

Aug 5, 2014|

Is America opening the door for worldwide oil sales? Current law doesn’t allow the export of oil from the U.S... but the first tanker full of unrefined oil has sailed from Texas to South Korea.  What will that do to our price at the pump?

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Automatically Generated Transcript (may not be 100% accurate)

Welcome back to -- Think the. -- seeing there one thing of blurred. Who never ever ever never never never numbers say yeah I know and always say I think it's a prime example. All it did to him like code through four decade ban on exporting. US oil this crude. And follow the rules of federal law that the bar's -- -- those hoops overseas. And to troubleshoot journal review the for news Bloomberg. And x.'s ten taper of oil from Texas. The story threads -- in South Korea. And it's the pursuing restricted sales -- on re and American oil. And when I'm when Doug do little homework on that. On -- and oil and according this has not been shipped since the 1970s. So my immediate. Question would read this. Four week. Open up exports. To foreign countries because. We -- gonna hit the mother load with the acting process with -- -- natural gas offshore oil. And is is this beneficial to Louisiana's have been crucial to the United States. Or will depict in the jobless womb we look at the price of the -- As always when -- thinking about Entergy are good questions good professor Eric Schmidt trembling in should. And proposed from welcome back to show them all iron curtain that from prominent. So. Is that what what's caused this is is because its own reply and oil that we can be sure. Well -- first thing we have to be a couple like Bill Clinton uses it all depends what you mean be. This is a definitional issue. And basically. The working definition. Of the -- too broad product it's something that's industrial. Religiously keep bore hole water triggered to accurately in the morning or if you government insurance still in the backyard view which. -- -- government is separating alcohol from war that should distillation are. Indeed particular case -- partner here. The desolation has to do reports call stabilized and sort of crude contract on the ground. And it's got these volatile components that are too big worry for moving coral -- rail commuter and her. If her -- -- vapor pressures in the return to our. It come off as a -- controller. Chip and celebrate rather. Crude truth distillation. All political and should it was mentioned column in the field. And when that happens. They take off those late for -- actions were sort -- -- stabilized. Crude reached agreement with the real horror and quite an incentive to to where there refineries. Question has -- that this and that that source. Partner rulings to companies involved part in the year. And I'm not -- a press products went through the government insured. He's played distillation of the test this so technically still isn't horrible shipment overseas. Since Reagan or. Not always -- the ceremony as -- -- ripple and it's it can't export. Refined product or crude oil during the Reagan. Administration. Very relax a triple its contributions we can export refined products. And -- presumably the in the export control in our state -- -- -- the eighties we we you know relax the rules as far as performance products. Clarity should companies go to the government and -- A lot of private ruling nobody trusts. We planned to ship these things it's refined products -- countries. Which you defined is finding Prosser expert directorate situations -- Is that okay. The government came back and so yeah okay. Well in all fairness because it's not okay probably -- -- vulnerable should always have the impression. What they do Friday -- Saturday in vitro tests. It meets the rules and under our intention. To -- And even if -- -- -- -- in check for the bosses loan and I had a nun who -- don't think -- lower. But do's it's solid precedent does this opens. It's. Well actually happened as a result of that is like cattle company which have virtually. No question. Immediately put in court reporter -- -- developers developers -- and -- America should do. And there's there's a real interest in twists. There are other companies buildings sort of many foreigners support from congress to prosecution's maternal. That'll much further in the -- -- -- could be changed -- restaurant. -- -- -- circles splitters are still owe. Them more than stabilization problem. And these things were going north peace. The people. World you know what abilities while we need to do -- they'll stick section -- to do it exports. Export terror -- approval. The there -- troubled tactic and so there's uncertainty for people who are already planning to spend some money. And don't put this in perspective. Stabilization unit by gosh you know tens of billions of dollars and thirty billion dollars cute about it simple. A splitter but it's more complicated. Unit article 300 million dollars. And it's gonna -- four under -- three billion. Hurt matters in a lot of. And -- I've -- to the companies that made the reports -- Followed the and shipped to South Korea. Well we're very very you have. We're putting well -- and I think that's probably becomes political reality of catching up with you know. -- bureaucrats -- basically something. We acknowledged procedure course for not acting on right now we'll get back. And choose or lose that break and come back. Revoke professor Eric Smith threw an institute of energy in the -- of him and I know him on there's a we have book couple of cost lease facilities from UCL a coach. -- think they were built to import. And but. My question this. Does does he see exports. And are relatively near future and it's so. -- those units being used. -- -- -- It is seventy immortal what we. It's called because. We're doing me in the usual in the exporting. Or old to. Out of the United States -- foreign countries. In particular in analyze them. A federal issue -- shields in the region and. Taxes and a we're I think we're getting to a point where we considered -- not the top producer rule book energy in the world were were very close to talk. And notices store where a tanker left taxes. For South Korea. Loaded with -- on replying to oil. And I quote the most so there's got to be Cooper's maybe this opens the door. And I've professor Eric Schmidt -- -- institute of energy. And professor of -- was paying attention in class. I think you said this might have been comparable bureaucratic. Mistake. Where they've been -- The issue up to their bosses -- to the president. -- -- -- You would like to thank you wouldn't need to the president that it was pretty straightforward definitional issue of these people played by the rules but the public relations without asking -- -- -- -- they -- You know a couple of either try. To go in Tuesday that your current term surely is. Fine now. Future that ship and it's not I can't depression. Before -- And -- and now obviously full political standpoint. But wasn't -- what -- you know secretaries. President have gone so they're content scrambling. True. Get things -- kind of -- control book. Took their definition. And if you're bureaucrats. Equipped to do British. Don't took Obama to do but he should actually which can export import. Let's go and applied -- Award linked. To your. As ever -- earlier probably have that backwards. But don't we have -- the two. Facilities all of the on the Louisiana coast or off the Louisiana coast. Where we Goran to import natural guess Boone homered to an agreement. Now we're all -- up and markets are over lecture -- the biggest. Being -- -- which is the border between Texas and Louisiana and there'll NG receiving terminals -- -- -- -- war. Put some numbers which are also should. Here we go east there's also. A facility in there. -- And there's also hard to treat each corruption. And the last from getting him. In Boston and we have a number of import terminals available but who wants to import natural gas cheaper in the US can bar -- senior. The -- gonna have him we can move reverse engineer -- we start exporting. Well what you have to do it you know the answer. That question is yes. Would bring in billions of dollars were few Patricia to build these big with perfection trains -- take pipeline natural gas. And turned it into a cryogenic equipment that we can use a strange storage connections -- docks unloading or Portugal Russia. Hardware that's already there for the import terminal. We can convert it into an export terminal -- where you are really corporate election here are doing what will be the first long. That's fully converted -- gone on electronic screen. So it's economically feasible to do would -- global what does that bring in the way of money and off. Well these plans are very expensive. To -- of their departure construction are. And I'm of course very Brothers ran up. Triggered to operate these groups you know not thousands of people but it certainly hundreds of people. And then of course the -- those people produce. From those direct jobs. Close into the economy and that supports our current commander could induce structure. Most economists were targets agreed deal from from the United States to export LNG. Every -- we get as much as 800000. Barrels today. Brand just one of the minute you sort of fields pumping light or. Aural oral bleed. Into we're new here pumping oil Burnett for good as shrewd combination thereof. As Saudi Arabia. We are supposedly. In total about two million barrels to. That's counting the common equity capital employed -- Abduction and they usually measure would quit. Capacity. We have reached deals that are producing over a billion barrels to do it at all from actual field. So we're doing pretty well and -- that we consume about sixteen. Hello. It wouldn't when I hear about the army that being produced. I'm always amazed that this has a sustainable life to it. How long are we talking about withdrew with a fine and we know tens of decades of and more than forty years. You know I I think most of these -- you know party you have to measure of the traditional fields differently because. Each year's server creating your own right as -- -- -- -- play out more quickly than an actual. Congressional as well work. Spurt prosecutors think you know words -- part of it and essentially we -- we can keep in -- drilling and doing if he's horizontal wells and for recognition and produce pretty much a -- -- -- these great start in decades. It on one side when I think of oil exports I think while it's gonna improve the economy we're gonna get more money and in that every businesses. Concerned with -- know that can make our utility of those -- -- Plus troops rotation calls that -- on what are what are your thoughts. Well again. The economist. Listening to or reading. Are both trying to there'll be some small step in general as we. Export war -- world that construed. Suppress the price in the world market in the fact of matter is. When you fill up your car -- gasoline -- Alito based on the world price of more of them not to US protection you have expressed as a matter. In -- certain matters refiner -- gasoline has -- against the world price for more and Croatia it is. Generally higher than during the repression machine union -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- Question currently. Here these extra go up north collapse they're pulling out morally correct yeah. State in the control. It. Now. With the cost of oil out the barrel. Now -- drilled there and getting out. There and getting. Something laughs from well because -- have to play the transportation costs to -- to someplace you can monetize. Basically or the sole -- deliberate pace and so. When you see these prices the order -- -- restrictions should immediately work. That's the price of the world in the -- actually in Oklahoma. Who who who making it the extreme prop it that the federal government in these -- as per barrel. Yet they get worldly Barrow and they are also. Get paid big -- is where I am very racially award police -- the company before it ever drove well the government took that game. Now with these late tonight or or ultimately shall vote there indefinitely. -- -- caught -- very below the art wheelchair. Charging or. Getting in return for drilling. The other production offshore -- it's a little different mechanism where we give in the international arena. All right Erica -- basically. It's more like a joint venture deal and the government takes several of our US government taking. And the fifteen or 20% from valued partner or. -- happens over there is they take fifty or 60% it's relatively low cost or. Too liberal pro lifting. Whats the world some place -- -- two -- three dollars a barrel project zero program. Remember that has to go toward Asia can control the world certainly need. And they have to play and increased calls for shipping choke. Oil companies really don't like very much quality in terms of the -- produced productions -- Iraq. You know picture and major you know they have been able to. You know -- content of some of the instability it's like crowd -- concerned or whatever. But when you're in a war zone. The chances orient are committed a lot of punishment repercussions. So much higher cost to developing country. Protester always a pleasure be in your classroom. Have. Are. Good. Coming right back -- continued his subscription. Governor bill bigger celebrity immoral 53 you are welcome back we. We continue our competition in the composition. It is. Having grown up in the oil industry. And haven't done a thing about ten -- Joe's on it. I thought we had. A law against oil exports. From America and number one and as long and but I think it's been like since the 1970s. -- Thursday. Federal law that bars almost sold to the American. Cities. An -- a Bloomberg. View of the day. And it says that it tanker from taxes. -- is soon -- South Korea. And its. Total ship full of on replied and war oh and I'm restricted sale. And would rather -- thought no one little moments of change and number two. Is this the opening. Of exporting energy from the storage on the world. Written scores would have policy analyst at the economics department. Heritage Foundation's focus on energy producers and Erica appreciate the call. So what do you think is this slightly. Open door sports. And -- it. We're exporting right now -- this ultra light oil and of comments date kept coming out of a lot of the shale plays throughout the United States and because who were running into these problematic. Because of this explosion -- reduction in the United States. One of the ways to alleviate these parliament and create more market efficiencies to allow these -- -- and fortunately that the power Department of Commerce. The allowing -- -- export not fully hasn't given up for open to order these export but of the same time has allowed. More exports of this crew compensate oil which is a great thing and it and we should be. Appreciating that but also pushing for congress to really get get rid of the laws that prohibit crude oil. Or attempt I think give -- read correctly and only two companies were involved in the via. South Korean shipment or other companies being allowed to do this. No way. Partly the concern that other companies want to do it -- the Department of Commerce has been given the green light to all the companies to export compensated so. While this is the welcoming -- right direction we spoke a long way to go to get to where we want to be in terms well for crude oil exports. What's different swindle I crude and sweet crude. -- -- The same thing but this commentator -- exporting as this ultra ultra light crude so. And being produced in the shale region -- light sweet crude. Q it's going to make sense to export more of that content a lot of the refiners the United States are. Equipped to handle that have the sticker and power countered that come from into the middle lead or Canada or Mexico or Venezuela. So it's going to make cents and and our refineries invested you know hundreds of billions of dollars to handle it. Ticker -- oil. And sentiment -- lighter oil overseas and it's going to bring down gas prices in totality which is that you know it's a great thing for for US consumers. So what what's been allowed to been export -- In recent days in recent weeks has been as ultra away oil this sweet oil that's compensate. I think we've got a number of the soldiers -- had a number of facilities all of them with you on the coast. There were billed to import LNG liquid that -- Oh both moral and we we have the mobile with rocking and everything -- And I think one number of facilities. -- its growth -- new year. My words not a -- The technical. Technically correct term. I think they're reverse engineered. To where they can export natural gas or were -- conversion to those facilities. Yeah we are. It was kinda lucky enough even though they play an important enough to be at the -- line. For the nearby diversification. Prop the thing. After -- -- to be in the position exported to have their they're going to be first deadline to actually. Export natural gas they expect their ability to come online in 1815 and deliver shipment to the parties have contracts with. Companies in the number of different countries including Spain. And the UK. Not to deliver that now to depth and that we are going to see that because now Africa since there's so abundant lead cheap. In the United States and even in which building these multibillion dollar facilities and shipping it -- tankers that disparity. Played. Between the United States in part markets it's still so great that it's going to make sense that. Probably and number of these export facilities are going to be built there's over twenty companies that have applications and with the Department of Energy. Not to approve this process then and not all of them will be built. Good number of them -- All right -- let's -- -- Peru break when we come back the question obviously. Over the weekend in jesus' gonna meet jobs and and if so how many tens and hundreds and hundreds albums. And what does that mean -- the economy when you -- Shipped by pipeline and by a real road. Through Wednesday to overseas facility. Do we benefit financially. Coming right back of the -- brigades of putting him. 153. Yeah walking backward thinking about energy. Couple companies. They applied for and and I think the industry the people who ruled prize. Applied for the you have to the federal government troops and that it shipments of on the Brooklyn wallow. Just South Korea from taxes and -- -- and about four decade ban on exporting oil. From the United States anywhere left of federal law that bars moves that the CO. Bobo oil exports but they approved. And I think so far -- the country as a new other companies have been allowed duke as saying. But it's still being debated at this point. India. Federal bureaucracies. And we have nick Florence with this. Policy analysts in the economics department The Heritage Foundation focuses on energy. -- every dead. As much as 800000. Barrels a day comes from just one. Well maybe you -- -- group -- pumping like crumbs dislike war room. -- you mentioned. We're we're getting congress docked in the distribution. -- -- We've got some blocked it so. Yeah that's right. And because this oil production occurring in the United States produces that light sweet crude. Well which is great and mean it's some of the best the world you would want to -- is not but -- refineries. And didn't see -- coming obviously when they made there. Investment upgrade the couple decades ago and worked -- -- refined the media and have recurred again from Venezuela Mexico and Canada. We -- And that makes this match in this distribution in efficiency. Whereas exporting this to some of the refiners overseas would. Putting more oil in the market more refined petroleum product in the market. And thereby in the oil as a globally traded commodity and it makes up a large portion of that took place to hit upon. It would help bring down prices of gasoline in the future and saved consumers and motorists. A lot of money or time by export as well. What that's that's interesting because when I first heard. Of the potential possibility of exporting. A subway as Craig Morgan make a lot of money improve the economy. And then there's everything about businesses that said we're human -- -- utility who's gonna be doing that for a confrontation caught. Going up or -- the truth there. The truth is that they are going to go down and that that seems counter intuitive. Again when you think about exporting it to other markets you would think that that would drive the price dot but over the long term you know. Because these oil producers and receive higher prices and other one was. And produce more oil rather than shipping -- some of the production if they don't have any -- in the United States. That's going to make. -- it amounts of oil available globally. Which means there's going to be more gasoline and diesel being produced and again because all of this is that on the global markets going to reduce the prices. And then at the US consumers are not only gonna get the economic gains from expand production. And increased to facilities and does that generally increase in production also going to save money in terms of lower gas prices. And we mentioned forward took a -- can always you know we have some LNG liquid natural. Facilities that were built in and set up for importing the -- -- we're talking about exporting but at least one has converted. To be able to do exporting. If we get these up and running that we would -- -- number of jobs we talked about what kind of a commonly benefits come from. -- -- economic benefit both. Increase exports about death element in the crude oil band -- in terms. You know tens of billions of dollars increasing gross domestic product per year. Hundreds of thousands of jobs the I've seen estimates. In conjunction with what do in the crude oil export ban as -- Exporting more not a -- Support we have 500000. Jobs within the next decades these are significant job increases domestically. Again not to mention all of that is the increase in consumer. Welfare that we're going to get from a lower energy prices from increased economic growth because these are all things that benefit not to mention will be. Exporting energy. Countries where the prices are higher and that's going to bring down. Those prices so anything we import is going to cost what does well though in a preacher in the win win and you. Unfortunately we dole freely trade energy away while we would want to because that a government unnecessarily prohibited -- This at all that both economic and gains for both the countries were giving it to and the United States. Is there still -- of -- the cup and Cushing Oklahoma. But fortunately some of that in relieved. That are expanded pipeline through increased rail shipments. And and that southern portion of the keystone XL pipeline for instance helped relieve. Some of that parliament because it was built without the president's approval. Just some of that has definitely but the -- In time because we have this huge -- of this light oil. Oh because would end up being shot and production. If we don't have more air transportation and distribution capabilities that we don't have the ability to export. About the Canadian pipeline to Texas courts that is there and also -- -- that. Canada in an attempt to assume that. -- -- to the West Coast running into trouble with the indigenous straw in the the British Columbia. Think he'd done it though is. Still on hold would bring a -- -- 130000 barrels of oil per per day from. Candidate down the Gulf Coast refineries and right now there's. Some legal dispute in Nebraska -- that our administration -- using to kick the can down the road. And despite that this but the process that was really that'll multiple times by the department states payment was apparently made by. You I think when it comes attended. Target figure out ways to get that. A market one way or another whether it's overseas in China and its -- the united. It states it's played in a dramatic increase of rail -- that doesn't need the president's approval coming down the United States. And that pipeline would only do more. Efficiently and it paid in both economic way and environmentally safe way. So -- Did you quit stalling and build the pipeline and approve it. Unfortunately we have an administration that unnecessarily delay in the answer. Nectar a complicated subject you sort of people accused criminals and we can even think about it and yeah if you're at the time very -- that you agree it. -- right back over the deal brigades over the moral -- all right and thoughtful way and you'll you'll lose and that. I was adrift we're dimensions something you know. Tool people who do spreading. -- -- brings to beautiful police or acting. And I lived there would be given to -- the -- complicated things get. Even if they don't want that means every of that every other every. It doesn't want it doesn't have to do. And then instead and cheap for -- world and the whole lot more. Now pick up on the web sites through the. And it says Orange Bowl -- contiguous. To saint Tammany. Has been ranking. Since 2011. In this and whose call. Duke three wells that have been proven product there intangible. All of this or punching through and the same southern hills app world for system. That supplies. -- -- measuring can. So it's it's tough to get away from that even if you don't want it and if you make a move not to get it. There -- repercussions a lot of people just out of water. What do sure on that -- and Julie hill is next do not cool way governor bill bigger celebrity immortal by --