A South Texas onshore crude oil export terminal capable of servicing fully laden very large crude carriers (VLCC) could be up and running by 2020, the Port of Corpus Christi and The Carlyle Group said Monday.

As envisioned, the world-class export terminal, to be sited on Harbor Island near Corpus, would be the first U.S. location capable of providing onshore service to VLCCs, which can transport up to 2 million bbl per voyage.

Fully loading a VLCC in the United States now requires multiple ship-to-ship transfers, aka STS, which are performed in lightering zones out to sea. The Louisiana Offshore Oil Port, aka LOOP, can accommodate fully loaded VLCCs in its lightering zone.

“VLCC access at the Port of Corpus Christi will open the global markets for U.S. oil producers, pipelines, their supply chains and customers,” Port officials said. “The result could produce up to a $50 billion annual reduction to the national trade deficit. Importantly, the City of Corpus Christi would benefit from the thousands of direct and indirect jobs as well as billions in incremental economic activity.”

Port officials agreed to 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.”

Carlyle would lead the construction effort and ongoing operations of the terminal, as well as arrange for private funding for a required dredging project to allow at least a 75-foot main channel depth.

“A project of this magnitude further underscores the vital role the Port of Corpus Christi plays in the global energy markets and as an important economic generator for the great state of Texas,” said Port CEO Sean Strawbridge. “In partnering with such an experienced and well capitalized firm as The Carlyle Group, the market should take notice and have a high degree of confidence of this project’s success.”

The partners did not disclose how much the project could cost nor when they would issue a final investment decision. The project is subject to definitive documentation between the parties, completing due diligence and final approval from Carlyle’s investment committee.

However, as the Permian Basin’s oil production continues to build, much of it wending its way via multiple pipelines to the Gulf Coast region, finding an overseas outlet is considered paramount.

“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,” Port Chairman Charlie Zahn said. “Corpus Christi is open for business.”

According to Port officials, the terminal’s construction would require no local taxpayer capital outlay, as it would realize “regular rental payments, volume-based tariff income, land grants and other proceeds” to help fund its operations. If all goes to plan, the terminal could be operational in two years.

The terminal as initially designed is to include developing at least two loading docks on Harbor Island as well as crude oil tank storage inland across Redfish Bay on land secured by Carlyle.

Carlyle’s equity for the investment would come from its global infrastructure fund.

“Providing VLCC access at the Port is of critical importance to the United States, and we will collaborate with all stakeholders to ensure such service is provided,” said Carlyle’s Ferris Hussein, managing director of the global infrastructure team.

The Port’s project with Carlyle is not the only one contemplated for the Corpus area.

Last August, commodity trader Trafigura Group Pte Ltd. proposed building a deepwater port near Corpus Christi also to load oil supertankers. The firm has applied for a permit through Trafigura US Inc. subsidiary Texas Gulf Terminals Inc.

Meanwhile, Port Houston has several expansion projects underway to accommodate more cargoes. However, for now it is opting against additional dredging to accommodate VLCCs only as the costs would exceed $1 billion.

Also in the mix is Enterprise Product Partners LP, which in July said it was considering an oil export terminal to expand deliveries overseas that would be capable of loading VLCCs. Front-end engineering and design has begun, with initial work underway for permitting.