The Permian, the world’s largest NGL-producing region, is poised for continued growth across the NGL value chain. With domestic demand offering limited room to grow, can downstream infrastructure keep pace? Today, we examine the projects helping turn rising Permian production into global supply.
The Permian is the country’s largest NGL-producing region, and its output is expected to keep growing. By 2035, the basin is forecast to account for 53% of U.S. NGL production. Handling that growth will require a complex network of pipelines, fractionators and other infrastructure.
The oil pipelines from the Permian to Corpus Christi have been very crowded, but two recent expansion projects are adding nearly 200 Mb/d of capacity to Corpus Christi, providing a bit of breathing room. Gray Oak wrapped up a two-part 120 Mb/d expansion in May, and Plains All American completed its 75 Mb/d expansion of Cactus III (formerly EPIC), which just went into service in August.
The U.S. propane market typically follows predictable trends. With much of domestic demand occurring in the colder months, storage builds in the summer and is withdrawn in the winter. But since mid-April, storage levels have increased by only 1.2 MMbbl. Today, we explore what is going on and why.
The U.S. propane market is in a unique position. Production has continued to grow while domestic demand remains stagnant. The only solution for the market to balance is exports; however, those have been constrained by capacity at the dock. Today, we continue our examination of the propane market.
Supply disruptions in the Persian Gulf have sent global propane prices soaring, sharply widening the spread between international and U.S. prices. That has created a major opening for U.S. exporters, but with spot terminal fees at record highs as key export hubs already running near capacity, upside is constrained by loading capacity.
Houston and Corpus Christi dominate crude oil exports, but the balance between the two hot spots has been shifting in interesting ways recently. In Houston, Enterprise could extend its lead and in Corpus Christi, South Texas Gateway is fighting for the top spot after adding a new pipeline connection last fall.
The long-anticipated return of Enterprise’s Midland to ECHO 2 Pipeline to crude service is underway, bringing 220 Mb/d online for the first time since the end of 2023. This coincides with Enterprise’s new NGL line, the Bahia Pipeline, which began operations in December.
U.S. Gulf Coast ethane exports were up sharply in September thanks to the startup of new export terminals in Texas. The surge in export volumes contributed to an 8% increase in ethane prices between July and September and a similar jump in the ratio between ethane and natural gas. In today’s RBN blog, we look at how the recent additions to export capacity have impacted prices and review the basics of ethane economics.
A crude oil leak last Tuesday at the Enterprise Crude Houston (ECHO) terminal disrupted regional flows and caused crude differentials to move higher over the course of the week. While the spill was swiftly addressed by terminal owner Enterprise Products Partners, it still affected inbound and outbound operations for a few days. In today’s RBN blog, we discuss the role of the ECHO terminal and show how even an isolated incident can quickly have an impact on the market.
