Plans are afoot to double and maybe triple the liquefied petroleum gas (LPG) export capacity of the Pacific Northwest — British Columbia, Washington State and Oregon — giving the region an enhanced role in what has been a booming business. Volumes being shipped to Asia out of the Ferndale marine terminal in northwestern Washington State are at near-record levels, and AltaGas and Royal Vopak are building a 40-Mb/d (and expandable) export facility in northwestern BC that is planned to come online in early 2019. Further, Pembina may be only months away from committing to the construction of a 20-Mb/d LPG marine terminal, also in BC. Today we continue our series on the expanding role of Western Canada in LPG exports with a look at plans for new propane/butane marine-dock capacity in BC.
In Part 1 of this series we discussed the fact that propane and butane — the two natural gas liquids (NGL) products generally referenced as LPG — are produced by the processing of natural gas to yield mixed NGLs and the fractionation of those NGLs into purity products. Refineries also produce LPG, but it is increased production of wet natural gas (with its high volumetric content of propane, butane and other NGLs) that has really been driving the market. As we said in Come on Down to My Boat, the U.S. five years ago flipped from its long-time status as a net LPG importer to a net exporter; by 2016 net exports averaged 785 Mb/d — several times where they stood in 2012.
We noted in that same blog that, with oceangoing exports of LPG taking off and becoming an increasingly important element of the U.S. LPG market, RBN about three years ago worked out an arrangement to collect ship tracking data that monitors in real-time the positions of virtually every vessel in the global LPG trade. With that data, RBN can determine (based on the LPG-carrying capacity of each ship) how much LPG is exported out of each individual U.S. terminal, and the ultimate destinations of the shipments. According to the June 20 (2017) issue of RBN’s twice-monthly NGL Voyager Report, U.S. LPG exports by ship have averaged just above 1.0 MMb/d so far in 2017. (For a free trial to NGL Voyager, click here). Of that, the vast majority (928 Mb/d, on average) was sent out from marine docks along Texas’s Gulf Coast; another 49 Mb/d was shipped from East Coast terminals and 26 Mb/d was exported through Petrogas’s Ferndale, WA terminal, which so far is the only operational LPG export facility on the West Coast of the U.S. or Canada. (Exports from the Gulf Coast were down hard in June, but that’s a story for another blog.)