Sept. 23 (Bloomberg) -- Eagle Ford crude strengthened to the smallest discount to the U.S. Gulf Coast benchmark light crude as Texas regulators reported that production from the shale formation grew 36 percent from the year before in July.
Plains Marketing LP’s posted price for Eagle Ford light oil was $101.25 a barrel Sept. 20. The price relative to Light Louisiana Sweet strengthened by 81 cents to a discount of $3.81 a barrel, according to data compiled by Bloomberg. It’s the smallest level since Plains began posting prices in 2010.
The spread has narrowed 86 percent since reaching a year-to-date wide level of $26.46 a barrel on March 20.
The nine fields that make up the majority of Eagle Ford yielded 569,191 barrels of crude a day, according to preliminary data released by the Texas Railroad Commission, which oversees oil and gas drilling in the state. That is 36 percent more than he fields produced in July 2012.
May output was revised to 656,853 barrels a day from the preliminary report of 617,884, the commission said. Production totals typically increase in subsequent months as the state receives revised, corrected or late reports.
The Port of Corpus Christi, where much of the Eagle Ford crude is shipped to by pipeline, shipped out 367,535 barrels of oil a day in August, up 91 percent from the same month in 2012.
The Louisiana Offshore Oil Port, the largest waterborne petroleum import terminal in the U.S., received 2.4 million barrels of oil from Texas in June. LOOP received its first tanker of domestic crude in August 2012 after making modifications to one of its three offshore buoys to allow receipts from smaller domestic vessels, such as those carrying Eagle Ford crude out of Texas.
Growing production from Eagle Ford is helping fuel a renaissance in Texas crude. The state produced a total of 2.58 million barrels a day in June, the highest monthly level since May 1981, according to the Energy Information Administration, the statistical arm of the Energy Department. The EIA hasn’t released July production data for the state.
EOG Resources Inc. is the largest leaseholder in the Eagle Ford play, with 639,000 net acres. Chesapeake Energy Corp. is next with 485,000, according to data compiled by Bloomberg.
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