Outlook for industry forecast as guarded
Aug 1, 2004 12:00 PM
A FORECAST of “guard optimism” for the storage and terminal industry market was presented by Ed Lewis of Industrial Information Resources, Houston. He used the term because of what he described as continuing market volatility.
However, he said continued growth in Canadian oil sand will have a positive impact on US crude oil distribution and storage markets. In addition, Canadian companies have begun massive infrastructure construction for refined fuels facilities.
Despite gasoline imports declining, they are expected to increase as foreign refineries meet new US market specifications, said Chris Paschall, also of the firm.
Although in the last 10 years, more US storage and terminaling facilities have closed than have opened, storage tank construction is currently on the increase, said Ed Weatherly, also of Industrial Information Resources.
With new regulations for low-sulfur fuels in place, refineries and terminals may be required to install still more new tanks to protect product purity and avoid cross contamination.
Also on the upside is the development of liquefied natural gas (LNG) terminals on the Gulf Coast, sparked by improved, lower-cost technology.
LNG is expected to begin trading as a global commodity as demand grows in manufacturing operations.
Another product receiving headlines is ethanol. About 800 million gallons of ethanol production capacity is expected to be added by the end of 2004. Seven new plants started up in 2003, four have come online in 2004, and 11 new plants are expected to be completed by 2005.
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