Asian oil refineries are reportedly now shying away from shale oil imported from the United States due to its poor quality when compared to crude from other sources. The complex system that the United States uses to transports its oil to and from its source and export terminals, which is what helped it become one of the world's top oil producers in the first place, is apparently now causing it a lot of problems.
According to reports, the shale oil being exported out of the United States is often times heavily contaminated with numerous types of metals and a specific class of chemical compounds called oxygenates. These contaminants greatly reduce the quality of the fuel that is produced from the crude oils. These contaminants seep into the oil through the various pipelines scattered around the continent. Crude coming from shale fields throughout the country pass through these pipelines before reaching oil tankers in export terminals.
The problem also extends to the transportation of the crude to the giant supertankers laying in wait in the Gulf of Mexico. Some chemicals, such as those used to clean the inside of tanks, can also make its way into the oil before it reaches its destination. Stabilizing materials in various containers also seep in, adding to the contaminations.
Two major refineries in South Korea, which are currently the top importers of shale oil from the United States, have reportedly rejected a number of oil shipments claiming that it was too contaminated to process. SK Innovation Co. and Hyundai Oilbank Co. reportedly rejected shipments from Eagle Ford in January and February citing quality issues. The shipment of oil was sold by BP Plc.
Importers are also claiming that the contaminants actually damage their refining equipment. According to the senior vice president of Hanwha Total Petrochemical Co, a South Korean refinery firm, the oil they usually get from the United States is of lesser quality than what they get from the Middle East.
Middle Eastern oil is typically less prone to contaminant given the fact that each oil variety does have its own transport infrastructure. The United States, on the other hand, uses the same pipelines to transport different types of oil. The US currently exports more than 2.5 million barrels a day, which is a big jump from the 100,000 barrels a day it used to ship in 2012. South Korea is one of the biggest importers of oil from the United States, buying more than 550,000 barrels per day.
