Ethylene steam cracker projects are driving the expansion in Chinese LPG and ethane storage, prompting big investments
China's natural gas liquids (NGL) storage capacity continues to expand at pace, driven by growing petrochemical production capacity and diversified feedstock requirements, the latest Global LPG Storage Survey finds.
The number of Chinese LPG and ethane storage projects has risen to 13 with a combined capacity of 721,300t in the quarterly survey, which updates Asia-Pacific, from one of 120,000t from the previous update in May. These are set to start up from the second half of this year to 2028. Projects linked to ethylene steam crackers are driving the expansion, accounting for 61pc of new capacity.
Four cracker-related storage projects with a combined capacity of 441,000t can store ethane, while the feedstock accounts for 305,000t, or 42pc, of the total project capacity. Chinese operators of flexible crackers have been retrofitting their facilities to use ethane since 2025 owing to its price competitiveness relative to naphtha and LPG. The added feedstock demand lifted China's ethane imports by more than two-thirds on the year to 4.8mn t in January-June, Kpler data show.
This greater need for US ethane has prompted three companies with cracker projects to invest in ethane storage. These include Secco's 1.1mn t/yr naphtha and butane-fed cracker in Shanghai, Huatai's 850,000 t/yr propane and ethane-fed cracker and Sinopec Zhenhai's 1.2mn t/yr naphtha, LPG and ethane-fed cracker — both in Zhejiang. The ethane storage at these sites totals 255,000t combined.
Secco plans to use 480,000t of ethane to substitute about 1mn t of naphtha each year. Huatai completed its cracker retrofit and has been importing ethane since 2024. The firm is building a new 100,000t ethane storage tank after converting its same-sized propane tank to ethane in 2024. And the Sinopec Zhenhai refinery is installing a 65,000t ethane tank for its integrated crackers.
Sanjiang is building a new LPG and ethane import terminal and storage site capable of holding 136,000t of LPG and 80,000t of ethane in Ningbo, Zhejiang, to reduce feedstock costs for its 1mn t/yr naphtha, LPG and ethane-fed cracker. The site will be able to accept cheaper full VLGCs and very large ethane carriers.
China's propane dehydrogenation (PDH) sector is still investing in new propane storage infrastructure, adding 110,000t from three projects combined. This includes a new LPG terminal being built in Cangzhou, Hebei, to serve Haiwei's 500,000 t/yr PDH unit and Kaiyi's 660,000 t/yr MTBE unit that will be able to store 40,000t each of propane and butane. The firm has been buying trucked propane from Shandong or Tianjin for the PDH plant, with supply disruptions and weaker margins from higher truck prices forcing the unit's intermittent shutdown — its utilisation stood at 33pc in 2025 compared with the 71pc national average.
Grand opening
A new 28,800t refrigerated butane tank in Dongguan, Guangdong, for Grand Resources, which operates two 600,000 t/yr PDH units, is under way and will allow the firm to buy full VLGCs from the Middle East, which are often split propane-butane loads, as it has a 69,800t propane tank. China has imported more LPG from the Middle East since April 2025, when it announced retaliatory tariffs on US LPG. China's LPG imports from the Middle East rose by 25pc on the year to 17.8mn t in 2025, while imports from the US fell by 35pc to 11.6mn t, Kpler data show.
China's growing fleet of crackers and PDH plants has seen a 9pc increase in the country's NGL storage capacity to 8.5mn t from 7.8mn t in 2024. Cracker and PDH-linked projects contributed 377,000t and 340,000t of this capacity, respectively.
Two terminal and storage facilities have opened this year. An LPG project in Huizhou, Guangdong, started operations in June, and can store 64,000t each of propane and butane. Another terminal in Lianyungang, Jiangsu, which can store 89,000t of propane and 44,500t of butane, is selling trucked LPG to Shandong.
