Operations have begun at Enterprise Products Partners LP’s expanded liquid propane gas (LPG) export facility on the Houston Ship Channel, and another one could be in the works as demand for U.S. propane continues to increase, the partnership said.
The marine terminal complex where the facility is sited is owned by Oiltanking Partners LP. Enterprise said the two companies “have significantly expanded the scope of their long-term terminal service agreement, which runs through 2026.”
Expansion of the facility increases Enterprise’s capacity to load fully refrigerated LPGs (propane, butane and isobutane). The loading capacity for low-ethane propane increases from the current rate of almost 4 million bbl per month to about 7.5 million bbl per month, providing customers with improved access to export domestically produced LPGs to growing international markets.
The amended terminal service agreement with Oiltanking will provide Enterprise additional operating flexibility, including an increase in the number of docks available to load LPG export vessels. Access to the additional docks would support further expansions of Enterprise’s LPG export facility. Enterprise is evaluating an additional expansion that would increase propane export capacity up to 10 million bbl per month and could be in service as soon as the beginning of 2015, it said.
“There is strong international demand for U.S. propane, and we continue to receive strong indications of interest for long-term commitments from customers that could underwrite another expansion of the export facility,” said Jim Teague, COO of Enterprise’s general partner.
Last month during a conference call with financial analysts, Teague said Enterprise would grow propane exports from 40 million bbl in 2012 to 60 million bbl this year (see NGI, Feb. 4). “What we have targeted to sell over our export dock, we have sold,” Teague said. “But we have purposely left open a slot a month for spot opportunities or operational issues and have been enjoying even greater margins on our spot cargoes.”
The export facility is connected with Enterprise’s Mont Belvieu, TX, natural gas liquids (NGL) fractionation and storage complex. The complex is connected with purity NGL pipelines that deliver product from fractionators around the country as well as pipelines that transport mixed NGLs from liquids-rich production areas.
Two additional NGL fractionators are under construction at Mont Belvieu and are expected to increase capacity to separate mixed NGLs from 485,000 b/d to more than 650,000 b/d by the end of the fourth quarter, Enterprise said.
Access to Asian markets for LPG exports is expected to improve when an expansion of the Panama Canal is completed some time during the second quarter of 2015, Enterprise said.
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