Argus AFEI-Edmonton and AFEI-Ripet netbacks

The AFEI-Edmonton and AFEI-Ripet netbacks

The AFEI-Edmonton and AFEI-Ripet netback calculations allow users to quickly compare Edmonton, Alberta propane prices relative to netbacks into Japan based on the AFEI (Argus Far East Index).

The netback calculations take into account VLGC freight from the Ridley Island Propane Export Terminal (Ripet) to Chiba, Japan, estimated Ripet terminal and other rail-loading fees, and rail costs from Alberta to British Columbia, to provide a comparison between the AFEI and the domestic market in Canada.

What’s the advantage of the AFEI-Edmonton and AFEI-Ripet netbacks?

The AFEI-Edmonton and AFEI-Ripet netback calculations help inform decision-making processes for Alberta gas producers and midstream operators considering whether to sell propane into the export markets or whether domestic prices at Edmonton are more competitive.

The netbacks can be used as tools to aid longer-term strategic decision-making on trade flows, as well as investments into LPG processing plants.

How are the AFEI-Edmonton and AFEI-Ripet netbacks used?

Producers of propane in Canada can use these netbacks to identify best value for their product in either their domestic market or in the key export market of northwest Asia (Japan and South Korea)

Producers of propane in the US can use these netbacks to assess how competitive their prices are compared to Canadian producers, including shipping and freight. 

Petrochemical plants can use these netbacks to assess potential supply from western Canada and when deciding where to source propane from

Governments and regulatory bodies can use the calculations to inform their assessments of the market for propane in Canada