So, the department of commerce has never bothered to look up the word “fungible” in the last 30 years?
CC
Shell paid Obama’s requested Jizya.
Stabalizers are NOT distillation towers.
What the government has clarified is oil and condensate, processed through a distillation tower, that is heated to vapor and separated into different products, is exportable without special licensing, just like it has been for years.
They have specifically stated that Stabalizing is NOT sufficient processing and cannot be exported without special licensing.
There has been no change in the rules, just added description to answer some of the frequently asked questions.
FAQs – Crude Oil and Petroleum Products December 30, 2014
http://www.bis.doc.gov/index.php/policy-guidance/faqs#navigation
4. What is required in order for liquid hydrocarbons to have been “processed through a crude oil distillation tower”?
Under Section 754.2(a) of the EAR, liquid hydrocarbons that have not been processed through a crude oil distillation tower are classified as crude oil. Liquid hydrocarbons processed through a crude oil distillation tower are classified as petroleum products (EAR99). 15 CFR 754.2(a).
Distillation is the process of separating a mixture of components according to their differences in boiling points. In order for liquid hydrocarbons to be classified as petroleum products, there must be material processing through a crude oil distillation tower. If there is no processing in the distillation tower, or the processing is de minimis, the liquid hydrocarbons will not qualify as petroleum products.
Processes that utilize pressure reduction alone to separate vapors from liquid or pressure changes at a uniform temperature, such as flash drums with heater treaters or separators, do not constitute processing through a crude oil distillation tower. Crude oil processed through such equipment remains classified as crude oil.
The factors BIS will consider in reviewing commodity classifications to determine whether the product has been “processed through a crude oil distillation tower” include, among others:
(1) Whether the distillation process materially transforms the crude oil, by using heat to induce evaporation and condensation, into liquid streams that are chemically distinct from the crude oil input;
(2) The change in API gravity between the input of the process and the output of the process;
(3) The change in percentage of different types of hydrocarbons between the input and output of the process;
(4) Whether the streams resulting from distillation have purposes other than allowing the product to be classified as exportable petroleum products, such as use as petrochemical feedstock, diluent, and gasoline blendstock;
(5) Whether the distillation process utilizes temperature gradients and has significant internal structures, such as trays or packing, and differentiated output streams;
(6) Whether the distillation uses towers with more mechanical complexity and heat, higher residence time, internal structures that promote condensation and better separation, and a consistent quality liquid streams (also called cuts or fractions) than equipment used to separate vapors and liquids for transportation needs.
These factors are not intended to be categorical or exhaustive. In reviewing commodity classification applications, BIS will look at the particular circumstances of each application to determine whether the output of a process can be considered a petroleum product under the current regulatory definition.