Corpus Christi plays to its strengths in handling energy cargoes
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No one can say the Port of Corpus Christi is low-energy. The South Texas port is riding a wave of bulk and project cargo with a common theme: the energy industry.
Corpus Christi is home to three oil refineries — Koch, Valero and Citgo — but the port’s connection to energy extends to petrochemicals, liquefied natural gas and components for electricity-equipment windmills. “We’re the No. 1 port in the United States for wind energy,” said John LaRue, the port’s executive director.
Corpus Christi in 2015 handled more than 70 ships carrying windmill blades, rotors and related components, mostly imports from Scandinavia and Brazil. LaRue expects a similar number this year.
With its wide-open spaces, Texas has more wind energy installations than any other state. But with rail connections on BNSF, Union Pacific and Kansas City Southern, Corpus Christi handles wind energy equipment destined for points deep into the Midwest and as far west as Oregon.
Corpus Christi has had a long involvement in oil– and gas-related cargo and in agricultural commodities such as cotton, but over the years it also has dabbled in automobiles, containers and other sectors.
Two years ago, the port commissioned a strategic plan that identified Corpus Christi’s primary strength as energy. “When we looked at what we were, what the market was, and what the risk was, we decided that was a better bet for us,” LaRue said.
Corpus Christi has a position in several energy sectors. Wind energy is one. Oil refining is another. The shale oil and gas production boom has added a dimension: Corpus Christi is fewer than 100 miles from the Eagle Ford shale formation, which has helped generate billions of dollars in investment in petrochemical plants attracted by low-cost natural gas.
The biggest such investment in the region is a $12 billion-plus gas liquefaction plant that Cheniere LNG is building at Corpus Christi. Some 3,000 workers are building the plant, which will use giant refrigeration units, called trains, to cool natural gas for shipment in tankers. The plant’s first phase is scheduled to open in late 2018.
LNG tankers will be among the first vessels to benefit from the Panama Canal’s larger locks that are set to open on June 26, LaRue said. The new locks will accommodate 85 percent of the world’s LNG tanker capacity, compared with 15 to 20 percent for the canal’s older locks, he said.
Construction at Cheniere and other plants in the area has generated a steady stream of project shipments, many of which Corpus Christi has handled.
Three current projects include an $800 million iron ore reduction plant being built by Austria’s Voestalpine, an expansion of Italy-based M&G Chemicals’ $1.2 billion polyethylene resin plant, and a $1.3 billion oil and gas pipe plant under construction by China’s Tianjin Pipe Co.
The Voestalpine plant concentrates iron ore into dense briquettes that will be shipped in bulk to Europe. M&G’s product is shipped mainly in railcars. The port, state and railroads spent $46 million to develop a railyard to handle the plant’s 15,000 to 18,000 annual railcar moves. Tianjin Pipe’s plant is scheduled to begin production in the first quarter of 2017.
Though the oil and gas sector has been battered by oversupply and low prices, these and other projects should keep cargo volume healthy for several years, LaRue said. “We think there’s still a lot of opportunity,” he said.
The port plans $1 billion in capital spending during the next five years. One big-ticket item already underway is a $325 million project to deepen the port’s 45-foot channel to its authorized 52 feet. The port also is considering development of a multipurpose dock that would handle breakbulk, project cargo, heavy-lifts and roll-on, roll-off cargoes and possibly dry bulk.
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