Intercontinental Exchange Inc. and Magellan Midstream Partners LP on Feb. 14 announced the launch of a new auction for a portion of multimonth Permian West Texas Intermediate crude oil storage capacity at Magellan's East Houston terminal.
The East Houston crude oil terminal, which is owned and operated by Magellan, is among the largest in the region with 8 million barrels of active capacity and the ability to further expand storage. Recently, a total of 1.5 MMbbls of Permian WTI storage at the East Houston Terminal were leased on the ICE trading platform, with an average of 400,000 barrels leased per month.
ICE and Magellan hope that the auction will help bring additional transparency and efficiencies to the storage and transportation of crude oil in the U.S. Gulf Coast.
"At a time when North America is producing and exporting record amounts of crude oil, this opportunity brings together the trading technology and risk management capabilities of ICE's auction model and futures markets with Magellan's extensive oil storage and transportation operations in the Gulf region," said Jeff Barbuto, global head of oil sales at ICE.