Latest news with #ethane
Reuters
3 days ago
- Business
- Reuters
US ethane exports to China hit new roadblock with licence requirement
SINGAPORE/HOUSTON, May 30 (Reuters) - Chinese purchases of U.S. ethane, a key petrochemical feedstock, face fresh uncertainty after the Commerce Department told exporters to seek licences to export to China, according to trade sources and shipping data. Washington ordered a broad swathe of companies to stop shipping goods, including ethane and butane, to China without a licence and revoked licences already granted to some suppliers, Reuters reported on Wednesday. The move is the latest disruption in Chinese purchases of U.S. ethane, which hit a record of 492,000 barrels per day in 2024, or nearly half of U.S. exports, according to the U.S. Energy Information Administration. Early last month, China increased levies on imports of U.S. goods to 125% but waived the tariff for petrochemical producers who rely on the United States. for almost all their ethane imports. At least two Very Large Gas Carriers were waiting at U.S. ports to load ethane this week while 13 more tankers are headed to, or waiting off, the U.S. Gulf Coast to load about 460,000 metric tons of ethane in June, Kpler data showed. "It's going to be a major issue if all exports are suspended," said a Chinese ethane importer, who sought anonymity because he is not authorised to speak to media. "We are cautiously watching if exporters can obtain new export licences soon." VLGC Pacific Ineos Grenadier was supposed to load ethane for Ineos at Enterprise Products Partners' (EPD.N), opens new tab Morgan's Point terminal at La Porte, Texas, has docked there since last Friday, Kpler and LSEG data showed. Stl Qianjiang is anchored near Energy Transfer's (ET.N), opens new tab Nederland terminal, due to load ethane for Chinese petrochemical firm Satellite Chemical, the data showed. Enterprise, Energy Transfer and Ineos did not immediately respond to requests for comment outside office hours while Satellite Chemical could not be reached for comment. "The market disruption could be immediate," Julian Renton, an analyst at East Daley Analytics, said in a note. A trade source said Ineos, which also buys ethane for its plants in Europe, may divert its cargo there. In a a filing Enterprise, a top handler of ethane and butane, said it was evaluating its procedures and internal controls and could not determine if it would be able to get a licence. Traders said there may be limited near-term impact on Chinese operators, as they have sufficient stocks. East Daley's Renton said if the restriction holds, Chinese petrochemical plants could face critical feedstock shortfalls, while projects may stall. Chinese petrochemical firms use ethane as a cheaper feedstock alternative to naphtha, while U.S. oil and gas producers count on China to buy their natural gas liquids as domestic supply exceeds demand. Shares of ethane importers Satellite Chemical ( opens new tab were down 3.1% on Friday, while Wanhua Chemical ( opens new tab stock lost 1.3%.
Reuters
3 days ago
- Business
- Reuters
US terminal operator warns its ethane, butane exports to China could fall
May 29 (Reuters) - Enterprise Products Partners (EPD.N), opens new tab on Thursday said its ethane and butane exports could be hurt by a U.S. Department of Commerce requirement that it apply for a license to export to China. The United States has ordered a broad swathe of companies to stop shipping goods, including ethane and butane, to China without a license and revoked licenses already granted to certain suppliers, Reuters reported on Wednesday. The Bureau of Industry and Security, an agency of the Department of Commerce, informed the company that exports of ethane and butane pose an unacceptable risk of military end-use in China. Ethane and butane, liquids separated from natural gas, are used to make plastics and chemicals and also for heating and cooking. Chinese petrochemical firms use ethane as a feedstock because it is a cheaper alternative than naphtha, while U.S. oil and gas producers need China to buy their natural gas liquids as domestic supply exceeds demand. Enterprise, one of the top U.S. handlers of ethane and butane through its port terminals, said in a regulatory filing it was evaluating its procedures and internal controls and could not determine if it will be able to obtain a license. In 2024, Enterprise's terminal on the Houston Ship Channel loaded about 213,000 barrels per day (bpd) of ethane, of which about 85,000 bpd, or 40%, went to Chinese markets, the company said. Enterprise cautioned that it cannot determine how alternative markets and uses will develop nor the potential impact on ethane and butane prices. It also said it was uncertain how this restriction may indirectly impact U.S. crude oil and natural gas production and prices as natural gas liquids are byproducts of oil and gas drilling. Enterprise also warned that it was currently unable to ascertain whether these restrictions will have a material adverse effect on the company's financial position, operations, and cash flows. U.S. exports of ethane to China rose to a record 227,000 bpd in 2024, according to U.S. Energy Information Administration data, while those of butane rose to a record 26,000 bpd. Those exports have been seen as one way to reduce China's trade surplus with the U.S.
Reuters
3 days ago
- Business
- Reuters
Enterprise Products says its China exports could fall due to license requirement
HOUSTON, May 29 (Reuters) - Enterprise Products Partners (EPD.N), opens new tab on Thursday said its ethane and butane exports could be hurt by a U.S. Department of Commerce requirement that it apply for a license to export to China. The United States has ordered a broad swathe of companies to stop shipping goods, including ethane and butane, to China without a license and revoked licenses already granted to certain suppliers, Reuters reported on Wednesday. Enterprise, which owns and operates marine export terminals that handle ethane and butane, said in a regulatory filing it was evaluating its procedures and internal controls and could not determine if it will be able to obtain a license. Enterprise's marine export terminal on the Houston ship channel loaded about 213,000 barrels per day of ethane in 2024, of which about 85,000 BPD, or 40%, were exported to Chinese markets, Enterprise said.
Zawya
21-05-2025
- Business
- Zawya
WGC: QatarEnergy sees big growth in chemical industry, CEO says
BEIJING: QatarEnergy plans to more than double its capacity for plastics raw materials globally as it sees big growth in the chemical industry, Chief Executive Saad al-Kaabi said on Wednesday. The state-owned company expects its U.S. ethane cracker project to start production in the first quarter of 2027, he told the World Gas Conference. The project, a joint venture with Chevron Phillips Chemical, had been expected to begin operations in 2026, according to the U.S. company's website. It will include a 2.08 million metric tons per year (tpy) ethane cracker and two 1 million tpy high-density polyethylene units. Ethane is a byproduct of shale gas production. More petrochemical producers globally are building ethane crackers or reconfiguring their plants to process more ethane to reduce costs and capitalise on rising U.S. supplies as they face thin margins and global oversupply. Qatar, one of the world's three largest exporters of liquefied natural gas (LNG), expects its North Field East natural gas expansion project to begin production in mid-2026, he said, repeating comments on the timeline he made in a statement on Tuesday. Gas is needed for industry, for power, for chemicals, for food, Kaabi said, adding that gas is going to be the backbone for the next century for all societies around the world. "Anyone who's burning fuel oil or diesel for power can easily make the conversion from a cost perspective to gas," he said. (Reporting by Colleen Howe; Writing by Florence Tan; Editing by Tom Hogue and Christian Schmollinger)
Reuters
19-05-2025
- Business
- Reuters
Asian petrochemical producers chase ethane gains as margins dwindle
NEW DELHI, May 19 (Reuters) - Several petrochemical producers in Asia plan to reconfigure their crackers to process more ethane to reduce costs and capitalise on rising U.S. supplies as they face thin margins and global oversupply, company executives said. These include South Korea's largest cracker operator YNCC and SP Chemicals in China. In Japan, Mitsui Chemicals is studying the use of ethanol at existing crackers. The change will allow operators to keep their feedstocks flexible with U.S. ethane exports forecast to rise by about 7% in 2025. Ethane, a byproduct of shale gas, is typically cheaper than the more widely used naphtha. South Korea's YNCC is re-evaluating its investment plans to improve cost efficiency at its crackers, which have been running at minimum utilisation rates of 70–80% so far this year, its CEO You-Jin Lee said at the Asia Petrochemical Industry Conference (APIC) in Bangkok last week. "One of the ways we can do it is by increasing (the) use of ethane," said Lee. In China, SP Chemicals is studying plans to increase ethane use at its petrochemical complex in eastern China's Jiangsu province to up to 90% from 75%. "Flexible crackers will ultimately be the fittest to survive when margins are plunging," said a source at an east-China naphtha cracker who declined to be named because they were not authorised to speak to the media. "New entrants into the market will want to import cheap U.S. ethane," Armaan Ashraf, global head of natural gas liquids, at consultancy FGE, said, referring to petrochemical projects in the Middle East, Russia and Asia. Thailand's PTT Global Chemical will begin to use U.S.-ethane as an alternative feedstock at its petrochemical complex, securing 400,000 tons annually starting in 2029, the company said in a report released at APIC. In Europe, where global chemical giants have announced closures due to high operating costs and weak margins, INEOS is building a 1.45 million tons per year cracker, the U.S. Energy Information Administration said in its May 6 report. EIA expects this project to utilise up to 75,000 barrels per day of ethane when it comes online in mid-2026. Other importers, such as India, will have to build infrastructure including storage and ships to boost the use of ethane at their plants, an Indian industry source said. For example, ONGC ( opens new tab is seeking partners to build large ethane carriers to ship in 800,000 metric tons per year from May 2028 for its western India petrochemical plant. EIA expects U.S. ethane production to rise to a new record 3.1 million bpd in 2026 from 2.9 million bpd in 2025. This will increase U.S. exports to 540,000 bpd in 2025 and 640,000 bpd in 2026, EIA said. EIA expects Wanhua Chemical's newly started cracker in eastern China's Yantai city, which can process ethane or naphtha, to add 50,000-75,000 bpd of U.S. ethane export demand this year.
