BHP Billiton will soon take advantage of a loophole in American law to export an oil product from Texas.
Export of oil from the biggest state in the US has been banned for 40 years, but AAP reported that BHP has “deduced” that they can legally export ultralight sweet oil known as condensate without first seeking government approval.
The company said they would export processed condensate that had been fractionated in distillation towers at their Eagle Ford operations.
The revelation came during the US summer when the commerce department gave two texas companies permission to export condensate without refining.
BHP has been selling ultralight oil to one of the companies concerned, Enterprise Product Partners, for several months.
Bloomberg said analysts and members of Congress “have privately said they don’t think Commerce understood the full import of its ruling and the way the market would interpret it.”
Since June US crude exports have jumped from over 75,000 barrels a day to a staggering 411,000.
“We plan to export processed condensate that has been fractionated in distillation towers at our Eagle Ford operations in south Texas,” BHP said in a statement.
“We took the necessary time to thoroughly examine the issues involved and ensure that the processed condensate was eligible for export.”
It remains illegal to export petroleum and crude oil from Texas, a ban which was introduced in the wake of the Arab oil embargo of the 1970s which raised global concerns about energy security.