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Viewpoint: Canadian propane exports poised to rise

  • : LPG
  • 24/12/31

Canadian propane exports to Asia are expected to continue growing in 2025, driven by increased export capacity and natural gas liquids (NGL) production, as producers ramp up drilling to meet rising demand ahead of the LNG Canada export facility start up.

Propane and butane exports from Canada to Asia average about 153,000 b/d in the third quarter of 2024. AltaGas exported 128,272 b/d of propane and butane to Asia during the quarter, with about 50,000 b/d leaving its Ferndale, Washington, terminal and 70,000 b/d from the Ridley Island Propane Export Terminal (RIPET) in British Columbia (BC). Additional exports came from Pembina's 25,000 b/d propane export terminal at Watson Island near Prince Rupert, BC.

Midstream operators are investing in an additional 70,000 b/d of propane and butane export capacity in the next few years. AltaGas is advancing the construction of its Ridley Island Energy Export Facility (REEF) adjacent to RIPET, which will have an export capacity of 55,000 b/d in its first stage, potentially operational by 2028. Pembina is also considering a 15,000 b/d expansion of its propane export terminal, but a final investment decision (FID) has not yet been made.

Another potential increase in export capacity could come if Trigon Terminals repurposes its 18mn t/yr coal export terminal on Ridley Island for NGL exports. There has been no FID on this project, and the company is in litigation with the Prince Rupert Port Authority (PRPA) over export rights. If approved, the project could be operational by 2028, according to the company.

The growth in export capacity is driven by rising natural gas production, stemming from expectations of increased LNG exports from Canada. The 14mn t/yr LNG Canada export terminal began commissioning in late August and is expected to start shipping LNG cargoes by mid-2025. Located in Kitimat, BC, it is only 120km from the country's Pacific coast LPG export hub near Prince Rupert.

Another LNG facility under construction is the 2.1mn t/yr Woodfibre LNG export terminal near Squamish, BC, north of Vancouver. This joint venture between Canadian midstream operator Enbridge and Singapore-based Pacific Energy is expected to be completed in 2027. Additionally, the Indigenous Haisla Nation and Pembina Pipeline reached a final investment decision for their 3.3mn t/yr Cedar LNG floating facility in Kitimat, which is set to open in late 2028.

Fractionation capacity also grows

The increase in natural gas production will result in higher NGL output, with about 90pc of Canada's NGL production coming from natural gas. This has driven increased demand for fractionation services in western Canada.

Keyera plans to debottleneck its second fractionation unit at Keyera Fort Saskatchewan (KFS) in Alberta, adding 8,000 b/d of capacity to the existing 66,000 b/d. Keyera expects to make a final decision early next year, with potential completion by late 2026. The company has also secured customer backing to build a third KFS fractionator, which it hopes to commission in 2028.

Pembina continues to advance its 55,000 b/d Redwater IV fractionation facility at its Redwater complex (RFS) in Alberta, which is expected to be online in the first half of 2026. Currently, RFS has three fractionators with a total capacity of 210,000 b/d. Calgary-based Wolf Midstream reached an FID in July to build phase two of its NGL North complex, which will include a 90,000 b/d fractionation facility, including 60,000 b/d of ethane capacity.

Canadian propane exports increased to 64.9mn bl in January-October, compared with 58.7mn bl during the same period in 2023.


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Mexico inflation slows to 4-year low in January


25/02/10
25/02/10

Mexico inflation slows to 4-year low in January

Mexico City, 10 February (Argus) — Mexico's consumer price index (CPI) eased to an annual 3.59pc January, the lowest in four years, as deceleration in agriculture prices offset faster inflation in energy and consumer goods prices. This marks the lowest annual inflation since January 2021 and a significant slowdown from July's annual peak of 5.57pc, which was driven by weather-impacted food prices. The result, reported by statistics agency Inegi on 7 January, was slightly below than the 3.63pc median estimate from 35 analysts polled in Citi Research's 5 February survey. It compares with the 4.21pc headline inflation in December, marking five months of declines in the past six months. Mexican core inflation, which excluded volatile energy and food, sped slightly to 3.66pc in January from 3.65pc in December, while non-core inflation decelerated to 3.34pc from 5.95pc the previous month. Movement, in the non-core, said Banorte, was mostly explained by a positive basis of comparison, and "will reverse as soon as the second half of February to push the headline metric above 4pc," said Banorte. Core inflation accelerated slightly to 3.66pc in January from 3.65pc in December, marking the second uptick after 22 consecutive months of deceleration. Services inflation slowed to 4.69pc from 4.94pc, while consumer goods inflation ticked up to 2.74 from 2.4pc. Non-core inflation slowed sharply to 3.34pc from 6.57pc in December. This was largely due to base effects, Banorte said, adding these base effects are likely to fade this month to speed headline annual inflation back above 4pc. The base effects most clearly impacted fruit and vegetable price inflation, contracting 7.73pc in January from 6.65pc annual inflation the previous month. Moving forward, agriculture prices are highly exposed to the coming hot, dry season in Mexico, with the La Nina climate phenomenon, adding a layer of uncertainty. Meanwhile, energy inflation accelerated to 6.34pc in January from 5.73pc the previous month, driven by higher LPG prices. Electricity inflation, meanwhile, sped to 4.32pc in January from 2.65pc in December, while inflation slowed to 0.02pc in January for domestic natural gas prices from 5.67pc in December. Monetary policy The January inflation report followed the central bank's decision Thursday to reduce its target interest rate to 9.50pc from 10pc. This was the bank's sixth rate cut since March 2024, winding down from 11.25pc. The 4-1 decision marked an acceleration in the current rate cycle, opting for a half-point reduction rather than the previous five 25-basis-point cuts. In board comments with the announcement, the bank cited "significant progress in resolving the inflationary episode derived from the global shocks" in 2021 and 2022. These triggered rate hikes from 4pc in June 2021 to 11.25pc in April 2022, the target rate's historic high. Taking into account the "country's weak economic activity" and this progress in reducing inflation, the board said it would "consider adjusting [the target] by similar magnitudes" at upcoming meetings. By James Young Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Australia's Beach cuts FY24-25 oil, gas output target


25/02/06
25/02/06

Australia's Beach cuts FY24-25 oil, gas output target

Sydney, 6 February (Argus) — Australian independent Beach Energy has narrowed its oil and gas output guidance for the year to 30 June 2025, given delays in bringing the Western Australian (WA) 250 TJ/d Waitsia gas plant on line. Beach will produce 18.5mn-20.5mn bl of oil equivalent/d (boe/d) in 2024-25, it said in its half-year results to 31 December. It revised the top end of its previous forecast of 17.5mn-21.5mn boe down because of delays at Waitsia, which is operated by joint venture partner Japanese trading house Mitsui. Beach has maintained its guidance for first sales gas at Waitsia in April-June. The Adelaide-based firm last month reported its output at 10.2mn boe in July-December 2024, 15pc higher on the year, leading Beach to raise the bottom end of its guidance. The five Waitsia LNG swap cargoes that Beach has executed to date have brought forward revenue for the firm, which reported A$139mn ($87.1mn) from the two shipped in July-December 2024. A fifth cargo was lifted from Australian independent Woodside Energy's 14.4mn t/yr North West Shelf (NWS) LNG terminal in January, while a possible sixth may occur before the end of June. "We have opportunities for additional swaps in the market and we're looking very closely… I'm hoping to get another [cargo] out before the half-year," chief executive Brett Woods said on 6 February. About 35pc of the gas exported via swap cargoes to date were from Beach's own 20 TJ/d (534,000 m³/d) Xyris gas plant, meaning it will not need to be swapped back, Woods said. Beach expects 8-10 cargoes/yr of Waitsia gas to be shipped until 2028, with scope to further extend the project's LNG exports following the WA government's changes to onshore gas export rules. Waitsia partners hold a gas processing agreement with the NWS JV running until the end of 2028. Beach will start its Offshore Gas Victoria programme in 2025 as part of its ambition to become a major domestic gas supplier. This includes drilling the Hercules gas prospect in Victoria state's offshore Otway basin in April-June, described as a "large scale opportunity" with prospective reserves of 100bn ft³ (280mn m³). No change was made to Beach's 2024-25 capital expenditure guidance of A$700mn-$800mn. By Tom Major Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

India’s LPG use could contract after record 2024


25/02/04
25/02/04

India’s LPG use could contract after record 2024

Consumption is expected to fall as more households take up piped natural gas and LPG subsidies are unwound, writes Rituparna Ghosh Mumbai, 4 February (Argus) — India's LPG consumption may contract this year after reaching another record high in 2024 unless new demand centres for use as a clean cooking fuel emerge, budget documents show and industry officials say. Urban use of LPG as a cooking fuel in India is likely to be further eroded this year by the development of piped natural gas grids while rural sales could be affected if the government decides to remove subsidies. Households account for over 90pc of India's LPG demand. India's overall LPG consumption rose to a record high of 31mn t in 2024, up by 7pc on the year, according to oil ministry data, on the back of an election year that prompted several LPG incentives from the ruling BJP party. The government's target of adding 7.5mn more low-income households under the Pradhan Mantri Ujjwala Yojana (PMUY) subsidy scheme a year ahead of schedule also supported the growth. A total of 329mn households use LPG as of 1 January, government data show. India's LPG imports increased by 13pc to a new high of 21mn t in 2024 on growing consumption and flat production of about 12.8mn t. LPG use in urban areas is expected to contract as piped natural gas (PNG) becomes increasingly available, with household connections rising by 16pc to nearly 14mn last year, according to the oil ministry. PNG for households is subsidised by the government. Delhi expects the rural sector to drive demand growth as more users switch from harmful solid biomass fuels to LPG for cooking. But households that have switched fuel often return to cheaper firewood — a government survey shows that less than half of India's rural households use LPG for cooking, with the annual cylinder refill rate stagnating at three/yr since 2022. The government also plans to reduce LPG subsidies in its latest budget for 2025-26 beginning in April. Subsidies for low-income households will fall by 28pc to 91bn rupees ($1.04bn) in the next fiscal year from Rs127bn in 2024-25. India's overall LPG subsidy declines to Rs121bn from Rs147bn. The decline in subsidies will hurt LPG demand in price-sensitive areas — nearly 129mn people in India were living in extreme poverty in 2024, according to a World Bank report. No poll pull Elections are a major demand driver for LPG in India as federal and state governments often reduce rates or offer free refills during their campaigns. State-run refiners slashed 14.2kg cylinder prices by Rs100/cylinder in August last year to Rs803/cylinder ($9.20/cylinder) in Delhi, where they have remained since. LPG subsidies of Rs300/cylinder were also extended for low-income households, which is due to expire in March. Several state elections in late 2023 announced free cylinders, boosting demand for LPG throughout 2024. But the government may now look to wind down subsidies with no critical elections to contest in the near future, as it did after the 2019 election. Increasing government repayments due to state-run refiners for lowering prices may also force it to raise cylinder prices again, analysts say. The government made no provision in its budget proposal to compensate the refiners for losses incurred in selling domestic LPG to households at below cost. The losses accrued by refiners IOC, BPCL and HPCL from LPG sales during the April-December 2024 period are estimated to be around Rs285bn combined, according to their company reports. This would equate to Rs390bn for the entire fiscal year 2024-25. The oil ministry meanwhile forecasts India's LPG consumption to grow by 4.7pc on the year to 33mn t in 2025-26. India kept 14kg LPG cylinders at Rs803 in Delhi for a 10th consecutive month for January but cut commercial 19kg cylinder rates after five straight months of hikes by Rs14.50 to Rs1,804, according to state-run refiner IOC. India LPG fundamentals Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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


25/02/04
25/02/04

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

LPG imports to Asia from the two countries are forecast to rise by around a third by 2030, writes Ieva Paldaviciute Dubai, 4 February (Argus) — 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 Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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