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Q&A: Petredec pushes LPG to drive Africa clean cooking

  • Spanish Market: LPG
  • 16/07/24

LPG trading company and shipowner Petredec was recently unveiled as one of the founding members of the World Liquid Gas Association's (WLGA) Cooking For Life Africa Task Force (CFLA), following the in May. The company was one of the early international entrants to the sub-Saharan African LPG market and continues to pursue opportunities in the region. Argus' Oliver Binks spoke with Petredec's head of downstream, James Bullen, about the company's plans to help expand LPG's use across Africa:

Why did Petredec join the CFLA?

The task force is a direct response to the IEA's call to action following its summit in Paris in May. The IEA's ambition is to end cooking fuel poverty by making cleaner fuels accessible to all, thereby saving lives. The WLGA created the task force to focus on LPG's role in addressing this challenge. Although the problem itself is acknowledged to be surmountable, and not even particularly costly — in relative terms — the WLGA believes that LPG can largely solve the issue of clean cooking in Africa now. This is a belief that we not only share, but also through our work on the ground in Africa, fully understand first-hand.

LPG is well-suited to developing markets, such as those being highlighted as particularly problematic within Africa by the IEA. We believe that LPG's inherent benefits of being accessible, easy to deploy, well-understood and affordable make it the unparalleled choice for meeting the IEA's objectives.

What projects are the company involved in within the region?

Our strategy onshore has been to invest in markets where LPG is established and understood but market growth is in some way hindered. This is typically owing to a lack of investment in infrastructure, especially import infrastructure. We base our investment decisions on long-term opportunities for LPG and how we can alleviate these bottlenecks to facilitate growth.

Affordability is a significant barrier to fuel switching, so being able to import the cheapest possible product is a fundamental pillar of any investment plan we develop. And central to this is the necessity to select locations where the largest LPG carriers, VLGCs, can be accommodated to discharge cargoes. Big ships mean better freight economics, which means cheaper import prices and more affordable LPG for the consumer.

We have not announced the specific details of our new investments and are not in a position to do so yet, but the type of projects will come as no surprise to anyone familiar with our record. We have invested more than $200m in the past decade on medium to large-scale LPG infrastructure and it's fair to assume we will do more of the same.

What are the challenges to developing infrastructure in sub-Saharan Africa?

While working in each developing market has its own specific challenges, there are often common issues to navigate when large-scale infrastructure projects are under development. These include planning and permitting , environmental adherence and acceptance and navigating local bureaucracy, which can be multi-layered and onerous.

Delays are common and projects such as designing and constructing import terminals, distribution systems and break-bulk hubs are complicated and time-consuming. The key to overcoming these is consistency, perseverance, patience and commitment. Projects run late, budgets require amendments and remits change, but good opportunities are often difficult by nature. Keeping the end goal in sight and taking a long-term view are key.

What specific infrastructure in the supply chain needs the most investment?

Different regions and markets have different needs. Some countries have focused on one specific type of infrastructure investment while ignoring other key elements. Other countries are in need of modernisation across their entire supply chains. A problem we frequently come across is outdated and insufficient infrastructure stifling market growth.

While market participants' intentions to support the growth of LPG might be there, their efforts can be in vain if they are working with 50-year-old-plus import terminals with inadequate capacity to meet market demands, or an antiquated cylinder filling and distribution system.

How much LPG does Petredec supply to sub-Saharan Africa, and where does it source it from?

Petredec has supplied LPG to Africa since the 1980s, first in north Africa and then elsewhere around the coast of the continent. Annual quantities vary with supply contracts, but for many years now we have supplied significant volumes to South Africa, which we then distribute via road tankers across the southern part of the continent. From our import hub in Richards Bay, South Africa, our local subsidiary, Petregaz, transports LPG to nine countries across the region, often more than 2,000km in each direction.

We have always used our global trading, supply and shipping system to ensure that the most appropriate product is supplied to each market. This means as arbitrage opportunities open and close, product can originate from a number of locations, but for South Africa, we typically utilise our large offtake positions in the US Gulf to supply the market.

What other clean cooking options do Africans have apart from LPG, and why not pursue these over LPG?

We aren't aware of any alternatives as compelling as LPG when considered holistically as a "through the transition" energy option for developing markets. The IEA itself, in the report A Vision for Clean Cooking Access for All, identifies LPG as the primary solution to deliver clean cooking access, representing nearly half of the households gaining access by 2030. That is not to say that LPG is the answer to every problem in every market.

During the summit, we encountered new cooking stoves powered by solar energy and recycled pellets, both intriguing but reliant on electric power as a back-up fuel or for flame acceleration. Where we are talking about markets with limited access to electricity, neither of these are practical. The summit also highlighted a number of biofuels, some of which appear interesting, but developments are very early and at this point unproven. We do not believe that LPG's ready availability, low-cost set-up and easy scale-up can be bettered by any current alternative.

Which countries are the company focusing on for LPG market expansion across the region?

We are focused on expanding operations in our existing markets and new territories. We already deliver LPG to nine sub-Saharan African countries by road so fully understand the importance of multi-modal logistics. But we are keen to improve supply chain operations and are examining opportunities to utilise alternative forms of transport and enhance existing logistics in order to improve productivity and, most importantly, lower costs. Reduced logistic costs means cheaper deliveries resulting in improved affordability, which is crucial as we and our partners strive for market growth.

What are the company's objectives in terms of inland African LPG distribution this year?

The current project focus, particularly in South Africa, is on further optimisation of the supply chain to better serve our customers. Having acquired one of South Africa's largest dedicated LPG road logistics operators in 2023, we have now fully integrated that business into our operations and have set about further expanding the freight aspect of our offering. We expect to announce further developments in due course that will improve that level in terms of speed, cost and reliability.

Targeting new usage opportunities for LPG is also a key current focus, as we look to leverage the strong foundations we have laid since commissioning the Richards Bay terminal in 2020. Acute shortages of alternative energy options and an ongoing electricity crisis in South Africa have thrust LPG into the limelight as a viable substitute for power generation. We are engaged with several industrial and commercial businesses looking for energy security that are, for the first time, considering using LPG.

The company divested its Reunion business in 2023. Why and what lessons were learnt?

The business ran profitably throughout our 14 years of ownership, and together with our local partner, we had gradually managed to grow our market share and overall volumes. However, with our investment focus in the region shifting from the southern Indian Ocean to continental Africa, Petregaz Reunion had become somewhat isolated in our longer-term strategic growth plan. With their own growth strategy focusing on market consolidation and integrating operations, the business was a natural fit for Vivo Energy and a transaction suited all parties.


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02/04/25

Q&A: LGE still pushing EU for RLG concessions

Q&A: LGE still pushing EU for RLG concessions

London, 2 April (Argus) — European LPG association Liquid Gas Europe (LGE) continues to push to secure EU and member state support for renewable liquid gases (RLG) such as bioLPG and renewable DME (rDME) while protecting customers of LPG and autogas from policies intended to transition away from fossil fuels. Argus' Dafydd ab Iago and Matt Scotland spoke to LGE general manager Ewa Abramiuk-Lete: What is the EU's latest position on CO2-neutral fuels in road transport? The European Commission's 2023 regulation proposes a framework for registering vehicles after 2035 that operate solely on CO2-neutral fuels in accordance with EU law and climate neutrality objectives. Since then, the commission has been tasked with developing a definition of what CO2-neutral fuels are, but no official information has been released yet. Meanwhile, as part of the broader fuels industry, we've collaborated in a technical group to formulate a definition that encompasses all renewable fuels in line with the EU's renewable energy directive [RED III]. The group's report frequently makes reference to renewable LPG and DME. But will the commission consider anything other than e-fuels? Certain EU commissioners and commission president Ursula von der Leyen have emphasised the need for technological neutrality when revising CO2 standards for cars. The devil is in the details. At this point, there is talk, but we've yet to see any concrete proposals or indications from the commission. We are closely monitoring the current developments in the commission, primarily to determine whether the concept of technological neutrality is being practically implemented and if there is potential for more than just e-fuels and hydrogen. But the push for this concept should originate from member states. Failing to broaden the scope would be a missed opportunity to support a broader range of cost-effective, immediately deployable renewable solutions like RLGs and rDME. When could we find out what fuels are included? A decision may come later this year. Any initiative to reopen or amend EU legislation must come from the commission. Recent intense discussions in the European Parliament about the state of the automotive sector, as well as growing pressure from member states, could be enough to persuade the commission to act. What has been the reaction to the EU's clean industrial deal and state aid rules? We are still reviewing the new state aid proposals. At first glance, RLGs seem to be included. The commission indicates that all fuels compliant with [RED III] — such as bioLPG, biomethane and rDME — are eligible for support. Fossil fuels are generally excluded, with limited exceptions for natural gas under strict conditions. The justification for this is that natural gas is deemed cleaner than more polluting alternatives — an argument that equally applies to LPG. In which direction is the EU discussion on energy taxation heading? The European Council is still finalising the energy taxation directive. The matter lies with EU member states, which must vote unanimously on energy taxation. Progress is being made slowly. The current Polish Presidency of the Council of the EU will need to determine the next steps on critical issues before a consensus can be reached. For LPG, what is at stake is whether RLGs are fairly treated under the new tax framework — and whether the directive allows for differentiation between renewable and conventional fuels, and between business and non-business uses. How will the energy performance of buildings directive (EPBD) affect LPG? A lot is quite technical, but also vital for the sector. One key issue is the inconsistent implementation of the EPBD across EU member states. Guidance documents provide definitions of what constitutes a fossil fuel boiler, which is essential as several member states are preparing to phase out such boilers between 2035 and 2040. A significant question [is whether there will be] recognition of renewable-ready or renewable-compatible boilers, particularly those using bioLPG or rDME. We are analysing how member states are interpreting and implementing these provisions. In Italy, there is strong support for the continued use of bioLPG in heating, but this level of recognition varies significantly between member states. What is the latest on the EU's proposed restrictions on PFAS ? The European Chemicals Agency is conducting a socio-economic assessment as part of the EU's proposed restriction on PFAS under Reach, covering many industrial uses. In the LPG sector, PFAS — particularly fluoropolymers such as PTFE — play a critical role in cylinders, tanks and valves. These materials are essential for preventing leaks in systems that store and transport flammable gases. Some alternatives are being tested — including PFAS-free sealing techniques used by certain companies in Spain — but they are not yet widely adopted or validated across the EU. Promising developments are being made but require further testing to meet safety standards. Your recent RLG Outlook models European RLG output reaching 27.4mn t/yr by 2050 under the policy conditions. Is that not too optimistic given limited progress in the past two years and the dissolution of rDME joint venture Dimeta? While the dissolution of Dimeta was a setback, it does not change the long-term outlook for rDME. Our 2050 modelling shows that Europe could produce up to 27.4mn t/yr of renewable LPG equivalent, of which up to 40pc could come from rDME. The industry continues to see strong potential in rDME, and essential work is progressing on technical standardisation, and safety and blending rules. Our analysis also indicates that sustainable feedstocks are sufficient to fulfil this production potential. Out of 22 production pathways, we examined nine in detail based on a multi-criteria analysis. Only two are fully commercialised at present. This is why we are advocating for co-ordinated policy action — to accelerate commercialisation and mitigate investment risks. Will rDME be a core focus at LGE's Congress in Katowice over 20-22 May? RDME will be one of many key topics at the congress. The event will take place in Poland, drawing strong participation from central and eastern European markets, as well as from further afield, with delegates expected from the US, South America, Africa, Australia and Asia. [LGE] plans to present the RLG Outlook and explore opportunities for scaling up RLG production. In addition, sessions will focus on the role of LPG in agriculture, transport and heating — all critical sectors for the energy transition. Central Europe and Poland will be a core point of discussion, given its significant autogas market and ongoing energy security challenges. We will also address the impact of Russian sanctions on the Polish LPG market, with high-level representatives from the Polish presidency and industry ministry in attendance. Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Mexico GDP outlook falls again in March survey


01/04/25
01/04/25

Mexico GDP outlook falls again in March survey

Mexico City, 1 April (Argus) — Private-sector analysts lowered Mexico's 2025 GDP growth forecast to 0.5pc in the central bank's March survey, down by more than a third from the prior forecast, driven by increased concerns over US trade policy and weakening domestic investment. The latest outlook is down from 0.8pc estimated in February and marks the largest of four consecutive reductions in the median forecast for 2025 GDP growth in the central bank's monthly surveys since December. Mexico's economy decelerated in the fourth quarter of 2024 to an annualized rate of 0.5pc from 1.7pc the previous quarter, the slowest expansion since the first quarter of 2021, according to statistics agency data. Uncertainty over US trade policy has weighed on investment and contributed to the slowdown. Concerns have intensified in recent weeks with US president Donald Trump set to announce sweeping new tariffs on 2 April. Mexico is preparing its response, possibly including reciprocal tariffs, on 3 April. A key concern in Mexico is an expiring carveout to the tariffs for treaties aligned with US-Mexico-Canada (USMCA) free trade agreement rules of origin. Mexico's economy minister said last week ongoing negotiations aim to secure a "preferential tariff," including a continuance of that exclusion and lower tariffs for goods progressing toward USMCA compliance. The median 2026 GDP growth estimate fell to 1.6pc from 1.7pc in February. Analysts again cited security, governance and trade policy as top constraints to growth. Year-end 2025 inflation expectations edged lower to 3.70pc in March from 3.71pc in February. The central bank's board of governors cut Mexico's target interest rate by 50 basis points to 9pc from 9.5pc on 27 March, citing expectations that inflation will continue to slow toward the central bank's 3pc long-term goal and reach 3.3pc by year-end. The board said it would consider additional cuts of that size at future meetings. Mexico's consumer price index accelerated to an annual 3.77pc in February, as slower growth in agricultural prices was offset by faster inflation in services. The target interest rate is projected to fall to 8pc by year-end, compared with 8.25pc in February's survey. The median exchange rate forecast for end-2025 reflected expectations of the peso ending the year slightly stronger at Ps20.80 to the US dollar from Ps20.85/$1 estimated in the prior forecast. The end-2026 estimate firmed slightly to Ps21.30/$1 from Ps21.36/$1. By James Young Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

US propane prices remain firm as stocks fall again


01/04/25
01/04/25

US propane prices remain firm as stocks fall again

Inventories at a three-year low and strong demand for exports supported propane prices this month, writes Joseph Barbour Houston, 1 April (Argus) — US Gulf coast Mont Belvieu propane prices remained elevated relative to crude last month as domestic inventories declined to their lowest since 2022. Mont Belvieu LST propane prices averaged 54.3pc of Nymex WTI crude in March, up by 11.4 percentage points from a year earlierand 4.4 percentage points higher than the five-year March average. US propane stocks typically start to build from March as seasonal heating demand abates — the first stockbuild of the year took place in the second or third week of March in 2021-24, EIA data show. And support for prices from expectations of cold weather had largely subsided by early March, market participants said, with outlooks from the US' National Weather Service forecasting warmer than average weather for the first half of March. But US propane inventories fell for a 23rd consecutive week over the seven days to 21 March, dropping to 43.2mn bl (3.48mn t), their lowest since 29 April 2022, EIA data show. The latest stockdraw was largely because of stronger US exports, which offset weaker domestic demand. Propane exports averaged 1.91mn b/d (4.7mn t/month) in March, up from 1.83mn b/d in February, while domestic sales fell to 1.21mn b/d from 1.45mn b/d. Propane's value relative to crude reached a three-year high of 59.2pc by the end of February as strong heating demand tightened supply in the first half of the month and market participants appeared to cover short positions as it neared its end. Fading interest in prompt supply in March led prices to largely move in lockstep with crude until mid-month, but prices remained strong on tight supply and rose later in the month as buyers returned, peaking at 94.75¢/USG, or 57.6pc of Nymex WTI crude, on 24 March. As a result, propane will enter the summer off-season from its strongest quarter relative to crude in three years. US propane exports could remain high in April on strong petrochemical demand in China given rising production margins and delayed purchases from earlier uncertainty regarding US tariffs. But prices historically ease during the off-season and prompt Mont Belvieu backwardation suggests they could begin to fall soon. Mont Belvieu propane price, US propane stocks Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Carney backs Canadian fossil fuel sector


01/04/25
01/04/25

Carney backs Canadian fossil fuel sector

The prime minister's focus is on Canada becoming a superpower in conventional and clean energy, writes Yulia Golub Calgary, 1 April (Argus) — Canadians will vote for a new federal government on 28 April after recently assumed prime minister Mark Carney triggered an election on 23 March. The new leader has moved ahead in the polls and is running on more favourable policies for the country's fossil fuel industry, having already axed a carbon tax on the sector. Carney, who was sworn into office on 14 March after former prime minister Justin Trudeau stepped down, will face off against Conservative leader Pierre Poilievre. The Conservatives were widely expected to rout the Liberals and form the next government until a remarkable rebound in polling by the Liberals over the past two months, which has been attributed to the replacement of the increasingly unpopular Trudeau as well as rising anti-US sentiment linked to US president Donald Trump's tariffs on Canada and "51st state" rhetoric. Carney has removed a carbon tax on fossil fuels from 1 April, ending a contentious federal policy among the electorate. Abolishing the carbon tax has been one of Poilievre's campaign pillars. Canada will become a superpower in "both conventional and clean energies", says Carney, who has mentioned the need for more pipelines, trade corridors and energy infrastructure to diversify Canada's energy exports away from the US . The shift in energy policy priorities under the prime minister makes him more closely aligned with the Conservatives. Carney's strong opposition to the Trump administration is boosting his appeal, while Poilievre is increasingly being seen as having similarities to Trump. "We are facing the most significant crisis of our lifetimes because of President Trump's unjustified trade actions and his threats to our sovereignty," Carney said on 23 March when he announced the election. Speaking four days later after Trump said a new 25pc tax on imported vehicles and vehicle parts would be "permanent", the prime minister declared the "old relationship we had with the US... is over". Canada imposed retaliatory 25pc tariffs on select US goods from 4 February, subsequently delayed until 4 March, and says it plans to introduce additional tariffs if Trump follows through with his pledge to slap even higher taxes on the US' trading partners from 2 April. The two leaders held their first call on 28 March, in which they agreed to negotiate new economic and security agreements after the 28 April election. "We had a very, very good talk," Trump said. The US' 10pc tariff on Canadian energy imports remains in place. Canada's largest oil and gas firms have asked the government to declare an "energy crisis" to expedite new pipelines, ports and LNG facilities, while bolstering trade relationships beyond the US, streamlining regulation and reducing project approval timelines. Propane pain Propane costs for consumers in Canada and the US are expected to rise as a result of the 10pc tariff, panellists at the Canada Clean Fuels Summit said on 25 March. "Even if the tariffs are eventually lifted, there is no guarantee added costs will disappear," the Canadian Propane Association's vice-president of government relations, Katie Kachur, said. The tariffs could cost propane suppliers up to $200mn/yr, she said. Canada is exporting more propane by sea to Asia but most — about 62pc in 2024, customs data show — heads to the US, Kachur said. Canadian LPG term contract prices for the 2025-26 contract year starting on 1 April are falling owing to uncertainty over the 10pc tariff and forecasts for rising domestic production. Producers and buyers usually finalise deals early in the year but negotiations this year are yet to be concluded. Prices for propane from western Canada's Edmonton hub are being discussed at 23-25¢/USG ($120-130.50/t) discounts to equivalent prices at the US midcontinent hub of Conway, compared with 19-25¢/USG discounts for 2024-25. Term contracts for Edmonton butane are being discussed at 39-41pc of the calendar month average of Nymex WTI crude, down from 40-44pc. Canada's Pacific coast LPG terminals Canada LPG exports by destination Canada LPG exports by freight type Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

US ethane output, demand at records in 2024: EIA


21/03/25
21/03/25

US ethane output, demand at records in 2024: EIA

Houston, 21 March (Argus) — US ethane production rose to a record last year on higher prices relative to natural gas, while exports and domestic consumption climbed to new highs on increased petrochemical demand, the US Energy Information Administration (EIA) said Thursday. US ethane output in 2024 rose by 6.8pc to an all-time high of 2.83mn b/d, up from 2.65mn b/d in 2023, according to EIA data. Most of the production increase came from the Permian basin, with Texas inland output increasing by 139,000 b/d to a record 1.58mn b/d and New Mexico refining districts rising by 9,000 b/d to 191,000 b/d, also a record. In the US east coast, the Appalachian No. 1 refining district, comprising much of the Marcellus shale formation in Pennsylvania and West Virginia, increased production by 37,000 b/d to a record 327,000 b/d, accounting for 12pc of total US production, up from 11pc in 2023. The production hike resulted from higher rates of ethane recovery from the natural gas stream, EIA said. Recovery was incentivized as ethane prices strengthened relative to natural gas. During 2024, Mont Belvieu, EPC ethane's premium to its fuel value — based on day-ahead natural gas at the Waha hub in west Texas — averaged 17.91¢/USG, up from 13.64¢/USG in 2023, even as outright ethane prices averaged 5.55¢/USG lower at 19.02¢/USG, according to Argus data. The increase in Permian ethane recovery resulted in large part from negative Waha gas prices for large swaths of the year. US consumption rises 8.4pc Product supplied of ethane, a measure of domestic consumption, rose last year by 8.4pc to a record 2.33mn b/d, up from 2.15mn b/d in 2023, according to EIA data. Consumption rose to records in the US east coast and Gulf coast regions, driven entirely by higher cracker operating rates, as no new ethane crackers came online during the year. Ethane consumption in the US Gulf coast rose by 109,000 b/d to 2.1mn b/d, while consumption in the US east coast nearly tripled to 103,000 b/d, up from 37,000 b/d in 2023. The east coast surge was driven by Shell's 1.6mn t/yr Monaca, Pennsylvania, ethane cracker ramping up production after coming online near the end of 2022 . Exports climb 4.5pc US ethane exports last year rose by 4.5pc to a record 492,000 b/d, up by 21,000 b/d from 2023, the EIA reported. China took the bulk of shipments and saw the largest increase in imports, spurred by increased petrochemical demand and ramped-up construction of import infrastructure. The US exported 227,000 b/d of ethane to China, up by 14,000 b/d from 2023. Ethane exports to Canada rose to 76,000 b/d, up by 11,000 b/d from 2023, while exports to India fell by 9,000 b/d to 65,000 b/d. Ethane shipments to Mexico averaged 21,000 b/d last year, up from 17,000 b/d in 2023. The Asia-Pacific region last year took nearly 60pc of US ethane exports, followed by the Americas at just over 20pc and Europe at just under 20pc. The Americas were broadly responsible for most of the growth in imports from the US year-on-year, with receipts up by 17,000 b/d and the proportion of the total rising for the first time since 2020. The proportion of exports going to the Asia-Pacific region fell for the first time since 2018, in part because attacks in the Red Sea slowed exports to India during the first half of 2024. Ethane exports from the US are poised to rise further in the next three years, as Enterprise Products' new Neches River terminal in Texas, which will be able to ship up to 360,000 b/d of ethane or propane, is scheduled for operations in starting in 2026. Energy Transfer's Marcus Hook, Pennsylvania, export terminal, which can ship 75,000 b/d of ethane, is adding refrigeration to boost its capacity to 90,000 b/d. By Joseph Barbour Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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