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U.S.-based Continental Resources is seeking to sell Bakken crude oil to South Korea in a move being described as a major coup in the aftermath of the lifting of the U.S. crude oil export ban in January.
Continental Resources CEO Harold Hamm told an audience last week as an opener for a speech by Donald Trump that he had recently returned from South Korea where he was engaged in negotiations to deliver Bakken crude to the East Asian nation, Argus Media and National Gas Intelligence reported.
“And we are going to be able to do that. We are going to have Bakken oil going to South Korea,” Hamm opined.
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Continental Resources partners with South Korea’s SK Group in Oklahoma gas production. In South Korea, SK Group operates an 870,000 bpd refinery.
Still, no one’s quite sure how the U.S. company plans to get Bakken crude to South Korea. According to Argus, in the absence of a pipeline through the Rocky Mountains, crude would have to be shipped by railway to the Pacific coast or the U.S. Gulf coast before it could moved on to South Korea.
It’s an expensive endeavor, but some believe it could make economic sense in light of South Korean incentives for non-Middle East crude.
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Elsewhere, the lifting of the U.S. crude oil export ban has fallen flat. While Exxon Mobil was the first major to ship U.S. crude from Texas to its refinery in Italy, and while Geneva-based Gunvor commodities trader has also shipped U.S. crude to a storage terminal in Panama, nothing much has happened since the first quarter of this year.
Hellenic Shipping News says that less than 400,000 barrels per day is currently being exported by US producers, noting that “there are really no great incentives or competitive advantages for exporting crude from the U.S.”
By Charles Kennedy of Oilprice.com
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Charles is a writer for Oilprice.com