Qatar, UAE's LNG ambitions to boost LPG output by 2030

Spanish Market: LPG
04/02/25

LPG imports to Asia from the two countries are forecast to rise by around a third by 2030, writes Ieva Paldaviciute

LPG output from the Middle East's leading exporters Qatar and the UAE is due to rise significantly by the end of this decade, primarily driven by the development of LNG-related projects in both countries.

Qatar produced around 10.7mn t of LPG in 2024, but output is likely to grow by around 75pc to 17.6mn t/yr by 2030, Argus Consulting forecasts. This will be driven by state-owned QatarEnergy's North Field expansion project that intends to gradually boost the state's LNG production capacity to 142mn t/yr by 2030, from the current 77mn t/yr. Even though geared towards boosting LNG output, the North Field expansion will simultaneously increase LPG production as it is a by-product of LNG extraction and processing.

The project will be developed in three phases — 32mn t/yr North Field East (NFE), 16mn t/yr North Field South (NFS) and 16mn t/yr North Field West (NFW). The NFE phase is due to start commercial operations by mid-2025 and will yield around 4.2mn t/yr of additional LPG production from 2026, Argus Consulting estimates. NFS will add around 1.96mn t/yr of LPG by 2027, and NFW will add close to 1mn t/yr LPG in 2030 and another 1mn t/yr in 2031. QatarEnergy sells its LPG through spot and term deals, with supplies heading almost exclusively to Asia.

Meanwhile, the UAE produced around 12.5mn t of LPG in 2024, with output forecast to grow by around 20pc to 15mn t by 2030, according to Argus Consulting. This growth will primarily stem from three large projects that are now under development by state-owned Adnoc Gas. The 9.6mn t/yr Ruwais LNG project on Das Island will more than double the UAE's LNG capacity of 5.8mn t/yr. The project is scheduled to start operations in the second half of 2028 and it will simultaneously boost LPG production.

Adnoc's Meram — maximising ethane recovery and monetisation — project aims to increase ethane extraction from Adnoc Gas' onshore facilities in the Habshan complex by 35-40pc by constructing new gas processing facilities, as well as "enable and optimise feedstock supply" to the Ruwais industrial complex. Adnoc Gas anticipates Meram to be completed in 2026, with Argus Consulting forecasting the project to start yielding close to 700,000 t/yr of LPG from 2026.

Adnoc Gas is also nearing completion of the second phase of its integrated gas development expansion project (IDG-E2), which will enable the Habshan plant to process an additional 370mn ft³/d (3.8bn m³/yr) of offshore gas. This expansion, expected to be finalised in the first quarter of this year, could lead to an increase in associated gas products such as LPG.

These three projects together will raise both gas and liquids processing capacities by around 30pc by 2029, but Adnoc Gas notes that additional pre-final investment decision projects will further contribute to growth post-2029.

All roads lead to Asia

These new developments should significantly increase the amount of LPG exports from Qatar and the UAE. Qatar has been exporting around 10mn t/yr of LPG since 2015, while the UAE's exports stood closer to 11mn t/yr in 2023-24, Kpler data show. Almost all LPG exports from the Middle East head to Asian countries, led by India, which took around half of all exports from Qatar and around 70pc from the UAE's exports in 2024.

The UAE and Qatar appear to be confident that the growing appetite of Asian importers will provide a home for the increasing LPG supplies. Imports to Asia are likely to rise by around a third to 108mn t by 2030 from 2023, Argus Consulting data show. Rising supplies in the Middle East will allow the region to compete with the US, which may be increasingly important should a new US-China trade war unfold, although the Middle East would be unable to fill the needs of China as well as India.

Qatar LPG exports by country

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.

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.

US ethane cracking margins at 10-month low

20/03/25

US ethane cracking margins at 10-month low

Houston, 20 March (Argus) — US ethane cracking margins have fallen to the lowest in 10 months on rising ethane cash costs and falling spot ethylene prices at Mont Belvieu, Texas, according to an Argus generic model. Ethane cracking margins on Wednesday fell to 10.5¢/lb, the lowest level since May 2024. Margins have steadily narrowed from a peak of 24.75¢/lb two months ago, when a freeze took several US Gulf coast crackers off line and spiked ethylene prices to 35.25¢/lb in a trade at the Enterprise Products Partners (EPC) system at Mont Belvieu. The decline in cash margins largely follows falling domestic ethylene spot prices as US crackers have incrementally restarted and ramped up production since mid-January. US spot EPC ethylene traded Wednesday at 24.75¢/lb, the first trade below 25¢/lb since late November. The more than 10¢/lb decline in ethylene spot prices does not fully account for eroding ethane cracking margins. Ethane costs have risen by more than a third through February and into March, hitting an 18-month high last week of 31.1875¢/USG. Higher ethane costs have largely followed higher natural gas prices at the benchmark Henry Hub, which hit a two-year high at $4.491/mmBtu on 10 March stemming from tightening US gas inventories. Natural gas prices serve as a price floor for ethane because it is separated from raw natural gas during processing. The 60pc drop in ethane cracking margins over the past two months is unlikely to affect ethane-based ethylene production, as margins of at least 4-5¢/lb are generally still profitable for cracker operators. US ethane cracking margins in 2024 averaged 14-15¢/lb, according to Argus data. Ethane structurally remains the most advantaged feedstock on the US Gulf coast and was last surpassed briefly by a competing feedstock more than 18 months ago. Propane cracking margins are currently negative and the butane cracking margin has ranged from 3.5-8¢/lb this month. By Michael Camarda Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Dangote suspends refined product sales in naira

19/03/25

Dangote suspends refined product sales in naira

London, 19 March (Argus) — Nigeria's independently-owned 650,000 b/d Dangote refinery has "temporarily halted" the sale of petroleum products in the country's naira currency, according to a statement seen by Argus today. The decision was taken to "avoid a mismatch between our sales proceeds and our crude oil purchase obligations, which are currently denominated in US dollars", the statement read. Dangote said refined product sales in naira "have exceeded the value of naira-denominated crude" the refinery has received, and it will resume naria-denominated product sales as soon as it receives a naira-denominated crude cargo. Nigeria's state-owned NNPC recently said it is in negotiations with Dangote refinery about extending a local currency crude sales arrangement. By George Maher-Bonnett Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

India’s giant LPG pipeline project faces further delay

18/03/25

India’s giant LPG pipeline project faces further delay

The world's largest pipeline has been beset by delays but promises to shorten transportation times within the country, write Rituparna Ghosh and Matt Scotland Mumbai, 18 March (Argus) — The commissioning of the world's largest LPG pipeline in India is unlikely to happen in June and may not take place until at least the second half of the year because of technical issues at Kandla port, according to local industry sources. The 2,800km Kandla-Gorakhpur pipeline project that connects the country's import terminals on the west coast to inland demand centres all the way to northern India has been snagged by technical challenges at the site around Kandla port in Gujarat state, the sources say. The project has been postponed a number of times since prime minister Narendra Modi laid the foundation stone at Gorakhpur in 2019, in large part owing to the Covid-19 pandemic. Project engineers in early 2023 when the worst of the pandemic was over had put its estimated start at the end of the year , but by the end of 2024, state-controlled refiner IOC's pipelines director Senthil Kumar said it would be ready by March this year . Recent local media reports citing Kumar suggest the project would now be completed by June. But this deadline is unlikely to be met given the issues at Kandla, industry sources say. The opening of the pipeline is not expected to significantly boost LPG imports given terminal capacity constraints on the west coast, but it will reduce transportation times for LPG shipments to inland markets that are currently carried by trucks, they say. IOC — which is developing the project alongside peers Bharat Petroleum and Hindustan Petroleum with shares of 50pc, 25pc and 25pc, respectively — is reducing the number of trucks it operates that carry LPG from Kandla to northern India this year, the industry source say. The pipeline will transport around 8.25mn t/yr of LPG, around 25pc of India's total demand, IOC says. Around 340mn residential consumers in Gujarat, Madhya Pradesh and Uttar Pradesh will benefit from uninterrupted and cost-effective supply, the company says. Total investment will be around $1.2bn. LPG will be fed to the line from import terminals in Kandla, Dahej, Pipavav and Mundra, as well IOC's 276,000 b/d Koyali and BPCL's 156,000 b/d Bina refineries. The pipeline will deliver to 22 bottling plants in India's three most populous states, with the added supply intended largely for lower-income rural users under the PMUY subsidy scheme. India's ceramics industry in the Morbi region close to Kandla also stands to benefit from propane shipments made by the pipeline, which will travel through the area, the sources say. Demand for propane in Morbi currently stands at about 4mn m³/d of natural gas equivalent while PNG use is 3mn m³/d, with prices of both similar on an energy equivalent basis, local market participants say. Demand for propane from the region's industrial sector is expected to grow in the coming years as more is imported on India's west coast . The Kandla terminal received 3.2mn t of LPG last year, while the Dahej facility took in 1.38mn t, the Mundra terminal 812,000t and Pipavav 625,000t, Kpler data show. Around 1.53mn t of this came from the UAE, 710,000t from Qatar and 592,000t from Saudi Arabia. Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

AltaGas highlights need to target non-US export markets

18/03/25

AltaGas highlights need to target non-US export markets

The Canadian upstream firm is refocusing its LPG exports on markets in Asia as US tariffs are due to come into force early next month, writes Amy Strahan Houston, 18 March (Argus) — The US' possible implementation of a 10pc tariff on Canadian energy imports underscores the benefit of shifting as much LPG exports as possible to markets other than the US, according to Canadian midstream company and seaborne LPG exporter AltaGas. "With US tariffs, it's even more critical to connect Canada's energy exports to Asian markets," AltaGas chief executive Vern Yu said on 7 March. US president Donald Trump repealed his administration's implementation of the 10pc tariff for another month on 6 March after they officially came into force on 4 March. Yet the uncertainty still led to buying interest at the LPG trading hub in Edmonton, Alberta, withering as market participants tried to gauge when the 10pc tax might be introduced while simultaneously trying to negotiate term contracts for next winter. AltaGas says it does not expect any significant impact on its natural gas liquids (NGL) operations from the tariffs but has stopped short of giving any financial guidance past the first half of this year, citing slower-than-normal term discussions and subsequent delays to its hedging programme for full-year 2025. "Tariffs will have a negative impact on the cash flows of our upstream customers, but tariffs will be partially offset by a stronger US dollar," Yu says. "As a result, we do not expect material changes to natural gas and NGL production volumes." The Calgary-based firm expects Canadian natural gas production to rise by 25pc by 2030 as domestic producers, similarly to those in the US, ramp up operations to supply upcoming LNG export projects. Canada exported 123,600 b/d (3.64mn t/yr) of propane by rail to the US in 2024, the Canada Energy Regulator (CER) says, with a fraction of this — about 23,000 b/d — transiting to Mexico, based on data from the US EIA. Canada faces the same growing LPG supply length as the US linked to gas production expansion, and while seaborne exports to northeast Asia from terminals on its Pacific coast are rising, it is still reliant on deliveries over the border to the US — seaborne to rail are split. As a result, propane prices at Edmonton trade at a discount to equivalent prices at the US midcontinent hub of Conway to maintain southbound flows. The US tariffs are expected to weigh on LPG prices in western Canada, according to market participants and AltaGas. "Canadian NGL prices will partially discount to offset the cost of tariffs while Asian prices will remain unchanged. This will cause a wider Canada to Asia LPG spread, which we expect to be modestly additive to our merchant export margins," Yu says. AltaGas exported 122,200 b/d of LPG from its Pacific coast terminals in Ridley Island, British Columbia, and Ferndale in the US state of Washington, during the fourth quarter of 2024, up by more than a third on the year. Exports from the two terminals over the whole of last year rose by 15pc from 2023, the firm says. Northeast Asian delivered propane prices under the Argus Far East Index (AFEI) averaged an $18.85/bl premium to US Gulf coast Mont Belvieu LST prices in the fourth quarter, compared with a $26.44/bl premium a year earlier. Roughly 87pc of AltaGas' LPG exports loading in the first half of 2025 are under long-term deals or hedged on an AFEI basis against US pricing at $18.61/bl. Corral Reef The company continues to work on expanding its exports after reaching a final investment decision on its new 56,000 b/d (1.8mn t/yr) "Reef" LPG terminal, adjacent to the Ridley Island propane terminal, last year and plans to open it in 2026 . AltaGas is also working on removing methanol from its propane shipments although it has not provided a timeline. Once completed, propane loaded at Ridley Island will meet quality specifications for more markets in South Korea and Japan, as well as propane dehydrogenation facilities in China, Yu says. Canada LNG and LPG infrastructure Canada LPG exports by freight type 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