We help enable better policy, regulatory, refining and logistics decisions at the regional, national and international level using our unique, integrated WORLD (World Oil Refining and Logistics Demand) modeling approach. WORLD’s ability to capture the interactions among supply, demand, regulatory, fuels, logistics, trade and refining and between global regions has led to a 28 year track record of successful application to high profile questions/developments. These analyses range from world/regional investment and trade outlooks, to market implications of alternative logistics and crude exports scenarios, to assessments of marine fuels regulations, global catalyst markets and carbon regimes.
Keystone XL Pipeline Assessments for the Dept. of State
EnSys has undertaken a series of analyses to support the Departments of Energy and State on issues relating to the Keystone XL pipeline. In 2010, EnSys conducted an evaluation of the impacts on U.S. and global refining, trade, and oil markets of the Keystone XL pipeline project to bring additional Canadian crudes, including oil sands, into the United States. For this first study (“Keystone XL Assessment”) EnSys employed its WORLD model to address the potential impact on refining activities, crude slates, investments, margins and CO2 emissions, crude and product trade, and import dependency and supply costs under several pipeline scenarios centered on constructing or not constructing Keystone XL and/or other potential key pipelines. The model provided integrated analysis and projection of the global petroleum industry, combining top-down scenarios for projected oil price/supply and demand over the next 20 years with bottom-up detail on crude oils, biofuels, NGLs, refining operations, CO2 emissions and costs, transportation, product demand and quality.
In a 2011 “No Expansion Update”, EnSys was asked to examine in more depth a scenario where the Keystone XL pipeline and other major projects do not go ahead. In this study, EnSys and marine specialist Navigistics prepared a detailed evaluation of the potential for modifications to existing pipelines plus new rail, barge and tanker routes to ship western Canadian crude in the absence of major pipeline expansions. What this analysis projected – major growth in crude-by-rail plus extensive use of existing pipelines and rights of way as the basis for expansion – is to a large degree what has played out in the market.
In a third study performed at the end of 2013, EnSys was requested to examine petroleum market changes since the 2011 Final EIS and whether these altered the original conclusions. Changes took into account increases in domestic crude oil production, decreases in expected demand, and changes in infrastructure, particularly the increase in oil transport by rail. Again, this was a WORLD–based study that examined a range of scenarios. Incorporated as an appendix volume in the Department of State FSEIS, this market analysis provided quantitative projections of crude flows, refining and market impacts across Reference, High Resource, Low/No Net Imports and High Latin American Supply scenarios.
U.S. Crude Oil Exports Study for the American Petroleum Institute
In 2014, the API released the study “The Impacts of U.S. Crude Oil Exports on Domestic Crude Production, GDP, Employment, Trade, and Consumer Costs” prepared by ICF International and EnSys Energy. By employing econometric modeling in conjunction with global supply demand projections and the WORLD Model, ICF and EnSys were able to assess both industry and economy impacts allowing for the “feedback” effects of price elasticities and other factors. The study shows that exports of crude oil would have significant impacts on both the US economy and industry trade patterns and economics. Allowing exports could create up to 300,000 additional U.S. jobs in 2020 and shave billions off fuel costs for consumers. EnSys WORLD Model analyses correctly projected – as has happened – that WTI-Brent differentials would narrow sharply, with or without crude exports, because of the build-out in pipeline and rail crude transport infrastructure. WORLD modeling also projected crude exports growing to and potentially exceeding 2 million bpd but in the form largely of enabling a swap trade whereby exports of the lightest crudes and condensates – as is happening to Canada and elsewhere – would be partially offset by continued imports of heavier, sourer crudes better matched to US refineries. As the WORLD modeling also demonstrated, allowing crude exports would avoid the need for US refineries to operate and invest non-optimally to process very light crudes and condensates. Such non-optimal operation was shown to force up costs to produce gasoline while allowing crude exports would have the opposite effect.
EnSys’ Integrated Global WORLD Model
EnSys’ World Oil Refining Logistics and Demand (WORLD) Model is utilized by EnSys for strategic, regulatory and other assessments. The Model extends analytical boundaries by bringing the key parameters of the downstream into one system. The WORLD Model is highly flexible, with the ability to model short, medium, and long-term forecasts. WORLD captures and simulates the global and interlinked nature of the present and future petroleum industry, providing projections for global refining activity, investments, margins, and utilizations, crude and product flows, and pricing/differentials across alternative scenarios.