Ethane consumption, exports to rise

by Talk Business & Politics staff ([email protected]) 200 views 

U.S. consumption of ethane in the petrochemical industry is expected to exceed the combined consumption increases among all other petroleum and liquids products, including gasoline, distillate and jet fuel, according to the U.S. Energy Information Administration. Ethane exports should continue to rise as it’s exported by pipeline to Canada and by tankers to other countries worldwide.

Ethane is separated from raw natural gas at natural gas plants and is mostly used as a petrochemical feedstock to produce ethylene, which is used to build plastics, resins and other industrial products, according to the EIA. “As U.S. natural gas production has increased, the amount of ethane contained in raw natural gas production streams has exceeded domestic demand or the ability to export it abroad. This situation has led producers to leave some of the ethane in the natural gas stream, up to allowable limits set by natural gas pipelines and distribution systems, and to sell it as natural gas, rather than recover and market ethane as a separate product.”

Ethylene crackers, or plants that process ethane into ethylene, have been expanding and new ones have started operating. Also, pipelines that transport ethane and two ethane export terminals have been added, allowing U.S. ethane exports to rise. In 2017, construction was completed on three ethylene crackers, all along the Texas Gulf Coast. The new plants increased the United States’ capacity to consume ethane by 210,000 barrels per day. By the end of 2019, six ethylene crackers are expected to be completed, collectively increasing ethane consumption by 380,000 barrels per day.

In 2019, U.S. ethane consumption is expected to rise 33.3% to 1.6 million barrels per day, from 2017 levels. In 2019, ethane exports are expected to increase 72.2% to 310,000 barrels per day, from 2017 levels. U.S. exports are shipped to the United Kingdom, Norway, Sweden, India and Brazil. By the end of 2019, the exports could go to China, when a new ethylene plant there starts to operate.