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EIA analysis: NGL production climbs, exports skyrocket in Oct as most prices rise
HOUSTON, January 4, 2017 (PCW) -- The Energy Information Administration’s most recent release of NGL data shows that NGL production in October rose some 7% month-on-month to 109.769 million barrels (3.54 million b/d). Additionally, exports shot up 23% during the same time frame to 37.735 million barrels (1.217 million b/d). During this period, spot prices were largely on the upswing, gaining 0.5-7.5 cpg, or between 2.2-9.9%. Natural gasoline was the sole loser as it shed 3.25 cpg, or 3%, during Oct.
In terms of production, ethane/ethylene production surpassed that of propane/propylene for the first time since July. Ethane/ethylene production was at 40.134 million barrels (1.295 million b/d), up 5.325 million barrels from September. Propane/propylene supplies came in at 35.96 million barrels (1.16 million b/d) in October, up 1.095 million barrels from September.
Going forward, production is expected to climb given that spot prices have risen 3.75-42 cpg (8-57%) through the end of December due to, incremental demand from petrochemical cracking, heating demand, gasoline blending and added export capacity coming online.
Exports, specifically, have proven quite bullish. Propane/propylene exports, in particular, rose 8.85 million barrels in October to 26.709 million barrels (861,581 b/d). Ethane/ethylene exports fell 656,000 barrels month-on-month to 2.81 million barrels (90,645 b/d) in October.
The drop in ethane exports in October was due to a fire at Ineos’ cracker in Rafnes, Norway, that halted production and slowed exports from the Marcus Hook terminal. Loadings were also slow going at Enterprise Product Partners’ Morgan’s Point facility as it awaited Reliance and Sabic to take delivery of its ethane vessels. Going forward, preliminary EIA weekly data for propane exports show a slight dip to around 821,500 b/d in November, before leaping to 945,500 b/d through December 23, largely on Asian demand.
The jump also coincides with the in-service of Phillips 66’s 150,000 b/d Freeport terminal. Ethane exports should also increase in December given the return to service of Ineos’ cracker and the recent loadings for Sabic and Reliance. -- Samantha Hartke