LPG World editorial: Think tanks

Market: LPG
01/10/24

LPG storage capacity continues to expand as the latest LPG World survey grows to more than 1,300 facilities across the world

China's petrochemical expansion continues to be at the forefront of global investments in new LPG storage capacity, although a shifting focus away from propane dehydrogenation (PDH) to cracking and more interest in exploiting ethane is altering the make-up of such projects.

The number of Chinese storage facilities in the latest Global LPG Storage Survey 2024 rises to 130 from 126 in 2023, while capacity reaches about 6.7mn t, up from close to 5.9mn t. The two most significant contributions come from new terminals in east and northeast China. Befar New Material's import facility in Binzhou, Shandong province, and Hengli Petrochemical's Dalian terminal in Liaoning province. Both are capable of storing 160,000t of LPG — 80,000t of propane and butane apiece — and will be used to support their petrochemical units, as well as providing them with more opportunity to sell domestically.

The refreshed storage survey exclusive to LPG World is the first to include ethane-specific terminals — as well as breaking down the large North American natural gas liquid (NGL) storage caverns into approximate capacities for LPG and ethane based on regional upstream yields. China is again playing the most prominent part in trying to seize growing volumes of cheap US ethane for its petrochemical sector through the development of new infrastructure across the supply chain, including ships. As a result, the survey includes Satellite Chemical's Lianyungang terminal in Jiangsu, which can store 320,000t of ethane, as well as Huatai Shengfu's facility in Ningbo, Zhejiang, which can accommodate 80,000t — both can also accept newly built very large ethane carriers (VLECs).

And China is also dominant in the survey's first ever devoted section to the most significant storage projects, being home to five of the 10 developments included. A trio of new LPG terminals in Guangdong province in south China will each add 120,000t of capacity, while a new 50,000t unit will open in Qingdao, Shandong, all of which are due to open next year (see table).

The Global LPG Storage Survey aims to provide the most comprehensive collection of larger LPG storage facilities currently available. With this in mind, those collecting and verifying the data have again expanded its scope, this time to more than 1,300 units with a combined capacity of 73.5mn t, up from under 1,300 and 68.9mn t last year, and from 1,120 plants in the previous survey in 2022.

The latest survey also captures three new Indian facilities, one of which opened in 2024 and the other two are expected to open over the next few years. The first, now established, storage capacity is found at LPG trading firm Petredec's new 1.4mn t/yr Krishnapatnam import terminal on India's east coast, which opened in April. The terminal has two storage tanks that can store about 17,600t and 18,200t of propane and butane, respectively. The terminal has received nearly 60,000t of LPG since opening — 23,000t from Saudi Arabia on board the Al Maryah on 1 April and then 34,600t from Kuwait on board the Delma on 12 August, Kpler data show.

Vote of confidence

VLGC owner BW LPG and Indian LPG distributor Confidence Petroleum's joint import terminal project in Jawaharlal Nehru on the west coast of India is added to the project list. The terminal will be able to store 62,000t of LPG and discharge VLGCs when it opens, and while the project is still in its early stages, a prospective start-up of 2026 has been given. And Indian gas company Gail is developing the country's first PDH plant in Usar, around 40km from the Jawaharlal Nehru terminal. This project includes 60,000t of storage capacity to service the new plant, which is due to start up in 2025. Brazil's LPG imports are also on an upward trajectory, prompting it to invest in new terminal capacity. Should its Suape project see the light of day, another 71,000t of storage will be added.

Related news posts

Argus illuminates the markets by putting a lens on the areas that matter most to you. The market news and commentary we publish reveals vital insights that enable you to make stronger, well-informed decisions. Explore a selection of news stories related to this one.

News

20/06/25

Gas carriers pool on both sides of Hormuz

London, 20 June (Argus) — The number of gas carriers idling on both sides of the strait of Hormuz has grown in recent days as operational risks mount with continued geopolitical tensions in the Mideast Gulf. Kpler shipping data show that seven gas carriers halted today, joining a pool of 23 vessels now idling near UAE and Oman, south of the strait. Of the total, 13 began idling on or after 13 June, when the first reported strikes on Iran occurred. The pool includes nine very large gas carriers (VLGCs), six medium gas carriers (MGCs) and eight smaller vessels. At least 11 of the 23 gas carriers have been previously linked to Iranian trade, Kpler data show. Some of the vessels have probably halted as a result of the increased operational risks in the Mideast Gulf, although several were idle before the start of the conflict and may be so for other operational reasons. A second pool of halted vessels has formed inside the Mideast Gulf, where six VLGCs, all with history of assumed Iran trade, have stopped since the airstrikes began. At least two vessels — Pyra and Gas Endurance — stopped after making U-turns shortly after the conflict escalated, Kpler ship tracking data show. Assumed Iranian LPG shipments consisted of 47 vessels in the first quarter of 2025, according to Kpler. Current disruptions could significantly impact this flow, especially to China as it has increased its reliance on Mideast Gulf cargoes following trade tensions with the US. Shipments via the strait of Hormuz — Iranian and from other Mideast Gulf producers — corresponded to 60pc of China's LPG imports so far in the second quarter, Kpler data show, up from 40pc in the previous quarter, as Chinese buyers sought to replace US product. Despite the vessel buildup, gas carriers continue to transit the strait. Chartering activity in the Mideast Gulf rebounded on 19 June following the release of Saudi Aramco's July loading acceptances. An Indian charterer moved quickly and secured vessels at rates nearing $90/t on a Ras Tanura to Chiba basis, a sharp rise from the $76/t on 13 June before the start of the current conflict. Volatility is likely to persist as some vessels remain unwilling to operate in the area, which could further support freight rates on limited competition. But this could be offset if high time charter equivalent (TCE) revenues — now significantly elevated due to the risk premium — lure more shipowners back into the region. By Yohanna Pinheiro Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Find out more

News

Keyera acquiring Plains' Canada NGL assets for $3.75bn

17/06/25

News

17/06/25

Keyera acquiring Plains' Canada NGL assets for $3.75bn

Houston, 17 June (Argus) — Midstream operator Keyera will acquire Plains All American's Canadian natural gas liquids (NGLs) business for C$5.15bn ($3.75bn). The transaction, which is expected to close by the first quarter of 2026, includes 193,000 b/d of fractionation capacity in western Canada, more than 1,500 miles of pipelines gathering 575,000 b/d of NGLs, 23mn bl in NGL storage capacity, and the 5.7 Bcf/d Empress straddle gas processing plant. The acquisition is expected to deliver C$100mn of annual synergies between the assets in the first year, according to Keyera. Plains said the divestiture will allow the US-based midstream operator to focus on its crude handling assets in both the US and Canada. Plains will keep nearly all of its NGL assets in the US. The acquisition of Plains' assets gives Keyera NGL fractionators and gas processing plants in Fort Saskatchewan, and at the Empress facility in western Canada as well as storage at Sarnia, Ontario. It also links Keyera's existing assets to takeaway agreements for LPG exports out of British Columbia. Keyera chief executive Dean Setoguchi said the acquisition "... brings key infrastructure under Canadian ownership, keeping value and decision-making closer to home." Plain's Canadian business is underpinned by fee-based contracts with an average remaining life of 10 years, Keyera said. Associated NGL production in Canada is expected to grow by 500,000 b/d by 2040, according to Keyera, as natural gas production in western Canada climbs by 6 Bcf/d during the same timeframe. By Amy Strahan Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

News

US ethane exports slump as China flows blocked

17/06/25

News

17/06/25

US ethane exports slump as China flows blocked

The EIA has revised down its forecast for US ethane exports following the introduction of licensing requirements, writes Amy Strahan Houston, 17 June (Argus) — US exports of ethane fell to a nearly five-year low in early June following the US Department of Commerce's restrictions on shipments to China , but market participants expect the trade dispute to be short-lived. The department's Bureau of Industry and Security (BIS) sent a letter to midstream firm Enterprise Products in late May requiring it as the operator of the 240,000 b/d (5mn t/yr) Morgan's Point ethane terminal in Texas to obtain a licence for future shipments to China citing possible military uses for ethane and butane. The US' largest ethane exporter, Energy Transfer, which operates the 180,000 b/d Nederland ethane terminal, then received a similar notice on 3 June. Enterprise's request for emergency authorisation to ship three ethane cargoes totalling 2.2mn bl (177,000t) was subsequently denied, sending ethane prices at the Mont Belvieu hub in Texas to a six-month low of 19.25¢/USG ($142/t) on 5 June. Around 198,000 b/d of US ethane loaded during the week to 26 May, after Enterprise received its letter, down from 410,000 b/d a week earlier and 547,000 b/d in the same week of 2024, Kpler data show. They are forecast to stand at 218,000 b/d over the week to 9 June. Ethane prices at Mont Belvieu had recovered to levels seen before the trade restriction by 10 June, owing in part to seasonal gains in Gulf coast natural gas prices but also because market participants expect disruptions to cargo loadings to be temporary, with the US and China holding trade talks in London this month. Very large ethane carriers (VLEC) that deliver ethane to China were on standby by mid-June. The Pacific Ineos Grenadier , which loaded ethane from Morgan's Point while Enterprise appealed against the BIS measure, has been moored at the company's nearby Houston terminal since 9 June. Satellite's Seri Erlang remains offshore Energy Transfer's Nederland facility, while its STL Qianji ang , which loaded at Nederland in the first week of June, is now heading to India. Another Satellite vessel, STL Yangtze , discharged in India in early June, possibly owing to maintenance at Satellite's cracker in Lianyungang , China, and is now returning to Nederland, according to Kpler. "We are all hoping the policy will be reversed soon," one market participant says, while another adds that it is likely to be resolved in days and not weeks. Restricted view US government agency the EIA has nevertheless attempted to forecast the impact the restriction would have on US ethane exports, revising down its forecast by 51pc to 310,000 b/d (6.4mn t/yr) for 2026. US ethane export capacity is on track to grow to as much as 900,000 b/d by the end of next year following the opening of new projects, including Enterprise's new 360,000 b/d Neches River ethane and propane terminal near Beaumont, Texas, and expansions at Morgan's Point and Energy Transfer's Marcus Hook terminals. Chinese buyers of US ethane are also hopeful of a relatively swift resolution owing to the mercurial trade policy of the Donald Trump administration. If it is not forthcoming, they may look to switch feedslates to LPG and naphtha when possible in the shorter term, and those that have invested in new VLEC fleets could repurpose them to LPG or ethylene in the longer term. Neither would be an attractive proposition given the substantial levels of investment in new ethane-fed cracking and VLEC capacity, but would ensure that domestic downstream derivative plants are kept running. Chinese companies are unlikely to begin importing ethylene instead given the margins would still be uncompetitive compared with cracking alternative feedstocks. In any event, buyers "do not want to make a big decision they will regret", one market participant says. Mont Belvieu ethane price Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

News

Q&A: Suburban's renewable quest continues

17/06/25

News

17/06/25

Q&A: Suburban's renewable quest continues

London, 17 June (Argus) — US LPG distributor Suburban Propane was the first company to sell a propane-renewable DME (rDME) blend in California in 2022 . The company has also pioneered sales of biopropane in the US and has since expanded into renewable natural gas (RNG) — also called biomethane — and hydrogen. Argus spoke with Suburban's vice-president of renewable energy, Douglas Dagan, about the push into renewables and the challenges ahead: Could you provide an update on Suburban's renewable DME sales? We continue to have a strategic partnership with Oberon Fuels , which produces rDME in the US. We are the only commercial seller of a propane-rDME blend — right now we sell to all of our forklift truck and autogas customers from our Anaheim, California, location. The product is a true drop-in replacement that can be used in all propane applications. The blend ratio is currently small, but we are testing higher percentages to determine the maximum drop-in blend level. We received an exemption from the California Air Resources Board [CARB] to run a pilot testing higher blend levels in vehicles. What is the current blend ratio and what is the maximum you are looking at? Our commercial blend is 4pc rDME. This ensures no issues as a drop-in replacement. We want to get to a 10pc maximum, but we've done a lot of testing and are delivering at 4pc in the Anaheim market. We are confident there are no issues on the customer side when a 4pc blend is used in an engine. Now we're looking to assess higher blend percentages. Getting CARB pilot approval was the first step. Why has the maximum fallen from previous estimates of 20pc and then 12pc? RDME has a lot of potential, but it's more challenging than anticipated. We started testing before the World Liquid Gas Association [WLGA] did. The belief was you could blend up to 20pc and everything would work. It turns out it's more like 10pc — lower than hoped — which means environmental benefits don't scale as fast. You have to ensure no issues arise from the oxygen content in DME, such as seal degradation causing leaks. There must be a high degree of confidence. On the supply side, different blend ratios require dedicated tanks and infrastructure — you can't switch between 4pc and 20pc easily — so it's very costly to have more than one blend. What are the latest in terms of your renewable propane sales? We are rapidly scaling — we've sold over 1mn USG [1,900t] of renewable propane in California, where we primarily offer renewable propane. Several programmes support renewable propane, but California credits are the most lucrative. We will sell outside California and are exploring expansion. The biggest challenge is availability. Many producers don't yet see value in separating renewable propane from the stream — it's a by-product, from renewable diesel or sustainable aviation fuel (SAF) production. We're building relationships to say: we have demand, and we'll pay. We just need more of it. How does Donald Trump's presidency and the resulting pressures on the regulatory environment for the energy transition affect Suburban's renewable plans? I think the Trump administration is supportive of what we're doing. It has different priorities from the Biden administration, but we still see support at both state and federal levels for our traditional product. On the renewable side, we're developing drop-in renewable propane, as well as RNG and clean hydrogen. There's support for all three. A Trump priority is domestic industry, and our plans are heavily domestic. Every administration brings new challenges. Lack of certainty is the biggest — knowing future policies is hard. Luckily we have a traditional product and a renewable platform that have support from both parties and we think the outlook for the future is good regardless of which party is in control. Can you explain why the carbon intensity (CI) metric could be an important tool for policy makers? It's a critical metric, though a bit technical. Policy makers deal with many issues — energy is just one. But the more people understand CI, the better the decisions. The CI scale, developed by Argonne National Lab, is a full life-cycle emissions calculation, covering production and use. Electric vehicles [EVs] are often seen as cleanest, but not always. CI reveals this — the lower the better. For example, if the electricity grid is dirtier than gasoline, switching to EVs worsens emissions. In most US states, the grid is dirtier than traditional propane. Gasoline and diesel score about 100, traditional propane around 80, and renewable propane 20-40. Suburban is moving into hydrogen and RNG. Is this a diversification strategy or do they somehow complement the core LPG business? We have a large RNG facility in Arizona using dairy manure and co-feed from organic waste. We can produce 1,000–1,500mn Btu/d of RNG sent via pipeline to California for engine fuel. Its CI score is a little better than minus 350 — phenomenally clean. We're building a new facility in upstate New York, and upgrading one in Columbus, Ohio, that uses food and organic waste. We're also evaluating other RNG opportunities. But we're also growing our LPG business. RNG is a great product — and part of a strategic platform. Digesters make biogas, which becomes RNG. But raw biogas can also be used to make rDME and renewable propane. And RNG can make clean hydrogen — or rDME/renewable propane that can be transported and reformed into clean hydrogen on site. These are all interconnected. Will the company retain its core focus as a propane supplier? Yes. Propane is a unique energy source that will remain critical. Many customers are in areas where large-scale grid decarbonisation isn't feasible, so propane as distributed energy is vital. [And] more extreme weather events take down grids. Propane is resilient — useful for heating, cooking and generating electrons to power EVs where the grid can't meet demand. If emergency EVs run on electricity and the grid fails, you need another way to generate electrons. [So, propane has a lasting role.] Have Suburban's traditional propane sales been pressured by warmer winters? Winter 2024–25 was much colder than the record-warm winter a year earlier, which had lowered demand. This winter, heating demand climbed and sales increased. But our strategy doesn't rely on cold weather. We're growing non-weather-related demand via traditional and renewable platforms — especially for engines and back-up power. Our goal is to grow both platforms and deploy capital for the greatest returns. What are your hopes for the rest of this year for the renewables business? We plan to keep growing RNG production. Output is rising at our Stanfield [Arizona] facility and the other two mentioned. We're also exploring hydrogen opportunities and expect that segment to grow. For renewable propane and DME, we've seen tremendous recent growth — especially in renewable propane. We're pursuing more supply and new markets outside California. Reaching 1mn USG in sales was a big milestone — and we want to keep building on that this year. Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

News

LPG prices jump as Israel-Iran conflict risks trade

17/06/25

News

17/06/25

LPG prices jump as Israel-Iran conflict risks trade

The market has readied for a shift in Chinese buying patterns, while cautiously watching for signals of Iran's response, writes Matt Scotland London, 17 June (Argus) — International LPG prices and VLGC freight rates surged on 13 June alongside crude benchmarks after Israel's attacks on Iran, raising fears of wider disruption to Middle Eastern energy trade. But prices stabilised on 16 June as the markets assessed the odds of attacks on energy infrastructure and shipping in the region. Northeast Asian propane import prices on the Argus Far East Index (AFEI) and the Argus Ningbo Index climbed by more than $30/t to $577/t and $636.25/t, respectively, on 13 June as the market geared for stronger Chinese buying interest for US cargoes if Mideast Gulf supplies are disrupted. The Mideast Gulf front-month propane contract price swap edged up to $588/t, cutting its discount to the AFEI swap to $16/t from $39.50/t, reflecting the shift in demand to US supply. US Gulf coast LPG prices also rose abruptly. The fob propane cargo price jumped by nearly $21/t to $442.20/t, and the Mont Belvieu LST price rose by more than $23/t to $423.30/t. Firming AFEI paper values earlier in the day widened the US-Asia propane arbitrage to about $147–150/t, helping to lift loading fees at Gulf coast terminals, which had been at close to cancellation levels on weak Asian petrochemical margins and US-China trade concerns. Northwest European propane import prices increased by $22.50/t to $485.50/t cif Amsterdam-Rotterdam-Antwerp, fuelled in part by concerns that growing Asian demand for US cargoes could reduce US availability for the region. But sentiment in the region was subdued with major petrochemical buyer Dow still offering a cargo. VLGC freight rates on the Ras Tanura–Chiba route from the Mideast Gulf to Asia climbed from $69/t to $76/t on 13 June and to $85/t by 16 June, while Houston–Chiba and Houston–Flushing rates from the US to Asia and Europe were steadier as shipowners became cautious about the growing risk in the Middle East, trimming vessel availability. A closure of the Strait of Hormuz — which accounts for 25-30pc of global crude and gas flows — would severely restrict Mideast Gulf exports. International LPG prices steadied on 16 June as the markets reflected on the latest conflict and likelihood of the Strait of Hormuz being shut off. Much will depend on Iran's current capabilities and how that might affect its strategy. Tehran has appealed to US president Donald Trump to halt Israeli strikes and resume nuclear diplomacy, but he appears reluctant to intervene. Only one confirmed strike has affected Iranian LPG facilities — a drone attack on two gas processing plants in Assaluyeh. These can produce 77,000 b/d of gas condensate, 2,900 t/d of LPG and 2,750 t/d of ethane. But only one train was hit, according to state media. A separate fire broke out at the Fajr-e-Jam gas processing plant, which can produce around 200 t/d of LPG and 80 t/d of natural gas liquids. The affect on Iranian LPG output should be limited as it has plenty of gas processing capacity and it is the summer off-season for demand, consultancy FGE's Iman Nasseri says. China is forecast to import around 4.6mn t of LPG from Iran in the first half of 2025, which would be more than a quarter of its total, Kpler data show. Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Business intelligence reports

Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.

Learn more