LP Gas, May 2017

PROPANE INDUSTRY NUMBERS T otal U S production of liquefied petroleum gases propane and butanes increased to 21 million barrels U S liquefied petroleum gases production by region thousand barrels per day b d 1400 PADD 1 1200 1000 800 600 net change 400 from 2010 150000 b d 200 per day bpd in 2016 But according to the U S Energy Information Administration EIA production of LP gas increased in 0 all regions of the United States last year except on the West Coast or in Petroleum Administration for Defense District PADD 5 Unlike other regions West Coast LP gas production has been on the decline since 2010 Refinery production in the PADD is down as production totaled 80000 bpd in 2016 Thats 10000 bpd less than in 2010 An increase in production at natural gas processing plants has driven much of the nations increase in LP gas production which has nearly doubled since 2010 Production was close to 18 million bpd in 2016 In PADD 5 though natural gas processing plant production was flat at about 34000 bpd last year According to EIA relatively low levels of in region production PADD 2 net change from 2010 259000 b d PADD 3 net change from 2010 361000 b d Source U S Energy Information Administration Petroleum Supply Monthly West Coast LPG rail receipts by origin thousand barrels per day 50 45 40 35 30 25 20 15 10 5 0 1 PADD REGIONS PADD 5 5 4 2 PADD 4 net change from 2010 79000 b d net change from 2010 10000 b d 3 2010 2016 2010 2016 2010 2016 2010 2016 2010 2016 Canada PADD 3 PADD 4 PADD 2 West Coast LPG exports by destination thousand barrels per day 5 4 2 1 3 2010 2011 2012 2013 2014 2015 2016 2010 2011 2012 2013 2014 2015 2016 Source U S Energy Information Administration Petroleum Supply Monthly and a lack of LP gas pipeline infrastructure have isolated the West Coast from the LP gas related industrial growth that has occurred elsewhere in the U S especially along the Gulf Coast PADD 3 As a result PADD 5 increasingly relies on rail transport for its LP gas supply Although LP gas exports are up since 2010 and despite the West Coast being just 14 days away by tanker from major East Asian ports only 6 percent of U S exports to those destinations derives from the West Coast according to EIA The Gulf Coast which is 28 days from East Asia accounts for the rest of U S exports Asia is the top destination for U S LP gas exports accounting for 44 percent of all volumes EIA adds Still despite its relatively small share of growing U S 50 45 40 35 30 25 20 15 10 5 0 overseas Canada Mexico exports LP gas export growth measured in absolute volumes from the West Coast to East Asian markets has drawn increasing supplies of Asia bound LP gas by rail into the region especially from Canada New data shows that the West Coast received 46000 bpd of LP gas by rail from Canada and other PADDs in 2016 Thats up from 16000 bpd in 2010 At the same time exports of LP gas from the West Coast rose by nearly 5000 bpd in 2016 to more than 37000 bpd Product ultimately exported to Asia accounted for most of the growth According to EIA an increased ability to transport LP gas by rail has allowed western Canadian producers who can no longer ship LP gas by pipeline to the Midwest to ship more LP gas to the West Coast where it can be exported to overseas markets LPG EIA offers look into dynamics of West Coast LP gas 30 LPGas May 2017 www LPGasmagazine com