Sentinel Midstream is answering the call for more crude oil export infrastructure. While supply disruptions tied to the Iran conflict have accelerated a shift in global trade flows toward the US Gulf Coast, they have also exposed a key bottleneck: the limited ability to fully load very large crude carriers (VLCCs). Sentinel and its Texas GulfLink will tackle this hurdle.
Sentinel announced last Tuesday (May 5) that it will move forward with construction of the deepwater project, marking a milestone in the effort to meet growing global demand for US crude oil.
For buyers seeking to diversify away from Middle East supply chains, US barrels offer both reliability and scale. The key question is no longer whether the US can supply incremental crude, but whether the industry can efficiently move those barrels onto the water.
Today, the Louisiana Offshore Oil Port (LOOP) is the only US facility capable of directly loading a VLCC to capacity. Elsewhere, export volumes rely on a combination of partial loadings at docks and offshore lightering to top off tankers. The system has worked at current export levels, but it creates incremental costs, scheduling complexity and congestion risk, all factors contributing to growing spreads between US and global oil prices. As exports push higher, these inefficiencies increasingly define the marginal cost of moving US crude to global markets.
In the Crude Hub Model, East Daley Analytics estimates the system still has roughly 1–2 MMb/d of export headroom. But capturing that capacity becomes progressively more difficult without improvements in loading efficiency. In practical terms, the next tranche of export growth is less about upstream production, and more about reducing friction at the dock.
Sentinel Advances First Export Dock in Years
Texas GulfLink will directly address the dock constraint, enabling VLCCs to fully load in a single operation while bypassing congested ship channels.
The final investment decision comes after the project secured a license from the Maritimes Administration on Feb. 18 to build and operate a deepwater port for crude oil exports. The Trump administration said at the time that Japan would also
Dallas-based Sentinel is coordinating the project with the Department of Commerce and the government of Japan. Funding will be underwritten in part by commitments from the US-Japan Trade Agreement signed on Sept. 4, 2025, the company said.
Texas GulfLink will be located about 32 miles offshore Freeport, and will connect to an onshore crude oil terminal in the Houston market via a 42-inch pipeline. The project will allow VLCCs to moor and receive up to 2 MMb/d of crude oil.
Sentinel will lead the construction and commercial operations. Executives told Reuters they are targeting completion by 4Q28. The project has a commercial agreement with Freeport Commodities supporting demand.
Other Deepwater Projects Struggle
Increased global demand for US barrels tied to the Iran war and the closure of the Strait of Hormuz have highlighted the limits in US export infrastructure. While Sentinel has broken through, other deepwater proposals have languished for several years. These include Enterprise Products’ (EPD) Sea Port Oil Terminal (SPOT), Energy Transfer’s (ET) Blue Marlin, and the Phillips 66/Trafigura Bluewater project (see map above).
Within this group, SPOT has a potential advantage due to its regulatory progress. Enterprise received a deepwater port license and a final approval for SPOT in 2024. However, EPD did not reference the offshore terminal project during its latest 1Q26 earnings call.
Blue Marlin and Bluewater offer different paths to market, with an emphasis on leveraging existing infrastructure and integrating with trading and refining networks. Ultimately, differentiation across these projects will come down to execution and the ability to secure long-term volume commitments.
The broader takeaway is that US crude exports are entering a new phase where logistics — not supply — sets the pace of growth. If current trade flow shifts prove durable, more offshore export infrastructure like Texas GulfLink could move from a deferred investment to a critical component of the Gulf Coast system. – Rob Wilson, CFA, Keland Rumsey and Andrew Ware Tickers: EPD, ET, PSX.
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