U.S. ethane exports rise, export capacity to increase

by Talk Business & Politics staff ([email protected]) 1,151 views 

U.S. exports of ethane have risen from almost zero in 2013 to an average of 260,000 barrels per day through the first 10 months of 2018, accounting for about one-sixth of U.S. exports of hydrocarbon gas liquids, according to the U.S. Energy Information Administration. Ethane is a feedstock for petrochemical manufacturing.

The United States became the top exporter of ethane in 2015 after surpassing Norway, which is the only other country to ship ethane internationally. All U.S. ethane shipments went to Canada in 2014 and 2015, but in 2018, the United States sent ethane to 10 countries.

Ethane is produced by separating it from raw natural gas at processing plants, and ethane production rose as natural gas shale resources were developed in the United States. Ethane production rose 74% to 1.7 million barrels per day in the first 10 months of 2018, from an average of 1 million barrels per day in 2012, according to the EIA. Over the same period, ethane consumption in the United States rose to 1.5 million barrels per day, from 0.9 million, because of new demand sources and new infrastructure allowing ethane to reach consumers.

As a result of the increased supply and lower prices of ethane, the U.S. petrochemical industry invested about $200 billion to expand capacity at existing plants and build new petrochemical steam crackers.

The United States started to export ethane by pipeline to Canada in early 2014, and infrastructure additions have allowed ethane exports to rise. In early 2018, two more pipelines to Canada and two marine terminals that can ship super-cooled ethane overseas started to operate. U.S. export capacity has risen to nearly 450,000 barrels per day, and the United States sends ethane to Brazil, Canada, India, Mexico, Norway, Sweden and the United Kingdom.

Ethane exports from the Marcus Hook facility in Pennsylvania are expected to rise when the Mariner East 2 pipeline is completed to the terminal. Energy Transfer Partners, the parent company of Sunoco Logistics, has plans to build a second ethane export terminal along the Gulf Coast in Nederland, Texas. The Orbit Ethane Export Terminal should be completed in late 2020 and will have the capacity to export 175,000 barrels per day, with 150,000 barrels per day of that capacity committed to Satellite Petrochemicals of China for its two new petrochemical crackers.

Recently, American Ethane, a Russia-funded enterprise, broke ground in Beaumont, Texas, on a terminal that can export 480,000 barrels per day of ethane. The joint venture with Texas-based Martin Midstream Partners is expected to supply ethane to petrochemical crackers in China and is seeking governmental approval to start construction.

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