The proposed terminal is expected to be operational in late 2020, but the project is still subject to agreement on definitive documentation between the parties, satisfactory completion of due diligence and final approval from Carlyle’s investment committee, according to a joint press release issued by the port and Carlyle.
The proposed terminal is expected to include the development of at least two loading docks on Harbor Island, as well as crude oil tank storage inland across Redfish Bay on land secured by Carlyle.
“The terminal would be the first onshore location in the U.S. capable of providing export service to fully-laden very large crude carriers (VLCCs) and would further the port’s position as the preeminent global crude oil export hub,” according to the press release.
The Port of Corpus Christi claims to be the leading U.S. crude oil export port and the fourth largest port in the U.S. in terms of tonnage.
“Corpus Christi is certainly where the incremental barrels want to go as we have deep water, availability of land for development, and plenty of capacity to absorb the forecasted U.S. energy production growth in oil and gas,” said Charlie Zahn, chairman of the Port of Corpus Christi Commission.
Under the terms of the agreement, the port will work exclusively with Carlyle to bring together oil producers, marketers, pipeline operators and marine terminal operators to ensure a significant portion of the new oil production in Texas will have a reliable gateway to international markets, according to the press release.
Carlyle agreed to lead the construction and ongoing operations of the terminal on an exclusive basis and to arrange for a private funding solution for a dredging project to bring fully-laden VLCCs to Harbor Island.
Construction of the terminal will require no capital outlay from local taxpayers, and the port will realize significant regular rental payments, volume-based tariff income, land grants and other proceeds that will help the port fund other aspects of its operations.
Carlyle’s equity for this investment will come from its Global Infrastructure Fund.