LPG World - Argus Media€¦ · © 2012 Argus Media Ltd Page 2 Argus LPG World 21 August 2012 Europe’s network of refineries is both a source of LPG supply and demand, using LPG

T W I C E M O N T H L Y NEWS, PRICES AND ANALYSIS VOLUME XVIII, ISSUE 16, 21 AUGUST 2012

LPG World

© Argus Media Ltd www.argusmedia.com

Editorial: Refinery fallout 2

News/inventories

Thailand to increase autogas prices 3

Opec sees European demand contraction 3

DCP output rises 4

Copano sees further midcontinent weakness 4

Asian propane rises over butane 5

Taman starts exports 6

Odessa suffers from defections 6

Features

Japanese autogas misses growth targets 7

Pakistan eases duty on equipment imports 7

Autogas impresses academic 8

European propane in tight supply 9

US propane exporters eye opportunities 10

Data

Shipping 11

Market review — Europe 12

Market review — Asia 13

Market review — Americas 14

Prices 16

Inside

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The Panamanian government has, as expected, approved higher toll rates for the Panama Canal, ahead of the expected completion of a project to expand the conduit

The Panamanian government has approved toll increases for ships tra-versing the Panama Canal, along with a restructuring of shipping segments.

The new tolls take effect in two stages, in October this year and October 2013, the Panama Canal Authority (ACP) says. “The new structure offers price sta-bility to Panama Canal clients during the next two years, while the approved tolls remain below the value it offers as a safe, reliable and efficient route,” ACP chief executive Alberto Aleman Zubieta says.

ACP will increase tolls for seven seg-ments, including LPG and chemical tank-ers, as well as general cargo, dry bulk, tanker, and vehicle carrier and roll-on/roll-off, among others.

October hikesThe canal currently charges a laden tanker $4.46 per Panama Canal/univer-sal measurement system ton for the first 10,000t. A net Panama Canal ton is equivalent to 100ft³ of volumetric capac-ity. Under the new formula, these rates will rise by 5pc to $4.68/t in October and by 10pc to $4.92/t in October 2013.

The new tolls will be in force when US natural gas liquids giant Enterprise and Japanese importer Eneos Globe begin a new 200,000 t/yr LPG supply deal in 2014. And a massive expansion of the Panama Canal is expected to be completed at around the same time (LPGW, 24 July, p9).

The Asian Shipowners Forum, which represents shipowner associa-tions across Asia-Pacific estimated to control about 50pc of the world’s mer-chant fleet, had lobbied unsuccessfully against the toll hikes.

The canal’s new structure increases the number of shipping segments from eight to 10, including LPG, full container, dry bulk, passenger, vehicle carrier and roll-on/roll-off, tanker, chemical tanker, and general cargo. The container/break-bulk segment, which was included in an original proposal, has been eliminated. It also breaks down the tanker segment into three separate groups.

The canal is currently undergoing a $5.25bn expansion that will enable all existing very large gas carriers and all those on order to pass through it. But canal toll rates are a key factor in the overall profitability of shipping LPG from the US to Asia-Pacific.

Panama rates rise

Balboa

PanamaCity

Vacamonte

Cocoli

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Cocosolo bay

PA N A M A

Main ship routePort

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Bahia Las Minas

Taboguilla islandMelones island

toUS Gulf

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Panama Canal

‘At some point, the carbon performance of compressed natural gas gets overtaken by that of LPG’ — German academic Professor Thomas Heinze (see p8)

Page 2© 2012 Argus Media Ltd www.argusmedia.com

21 August 2012Argus LPG World

Europe’s network of refineries is both a source of LPG supply and demand, using LPG in various refinery processes and — in the case of butane — as a gasoline blendstock.

The loss of refinery capacity through temporary maintenance, closures or con-solidation can have a significant impact on LPG, but only if other factors add to the supply tightness.

This is exactly what has happened in northwest Europe in August and will con-tinue throughout September. Refineries are off line at the same time as mainte-nance has hit key LPG terminals.

Distributors that usually buy propane from refineries in the third quarter to build stocks ahead of the fourth quarter for the inland market have found their options sharply limited (see pp9-10).

Planned refinery maintenance in northwest Europe could idle around 820,000 b/d or 9pc of the region’s total refining capacity in northwest Europe during September — and around 533,000 b/d during the fourth quarter of this year. The LPG terminal shut-downs involve the ExxonMobil-operated

Braefoot Bay terminal in the UK from 23 August to 9 September, which will remove several large cargoes from the market in August and September. And the Gassco-operated Kollsnes gas pro-cessing plant in Noway will shut at the end of August.

Given these supply constraints, European propane prices have risen sharply and large cargo prices briefly

reached $960/t cif ARA this month, an unseasonable leap of $112/t from $848/t cif ARA at the end of July. Northwest European propane is also now trading at a premium to naphtha for the first time since February.

The insolvency of Europe’s larg-est independent refiner Petroplus last year has clouded an already muddy picture about what is the optimal level of European refining capacity — given the context of Europe’s continuing eco-nomic slowdown. In January, four out of five Petroplus plants were closed, amounting to the loss of 430,000 b/d

of capacity. But not all of its capacity is lost forever, as trading firms Gunvor and Vitol have bought some of its refineries.

But many experts still argue that Europe has a structural refining capacity surplus that needs to be addressed — and which led to the problems faced by Petroplus in the first place.

Spain’s Repsol, for example, says Europe still has 3mn b/d of excess crude distillation capacity. Italy’s Eni said earlier this year that its downstream division is suffering from “unprecedented demand decline”. When refineries do not turn a profit, their very existence is not assured — and LPG can suffer.

E d i t o r i a l

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Refinery fallout

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21 August 2012Argus LPG World — In brief

Asia-Pacific

Japan’s Iwatani posts lower profitsJapanese LPG company Iwatani’s profits fell sharply in the second quarter com-pared with a year earlier, mainly on lower sales. Profits were 80pc lower at ¥448mn ($5.7mn), compared with the ¥2.1bn recorded in the second quarter of last year. Operating profits for Iwatani’s LPG unit fell by more than 16pc to ¥1.5bn, while profitability for its other businesses such as industrial gas, basic materials and electronics also fell. Only Iwatani’s food and agricultural businesses posted higher profits for the quarter.

Thailand to increase autogas prices The Thai government has marginally increased domestic autogas prices with immediate effect, following recent hikes in international prices. The country’s energy ministry announced a 0.25 baht/kg ($7.92/t) increase in retail autogas prices from Bt21.13/kg to Bt21.38/kg from 16 August. The government delayed planned autogas price hikes for three months starting in May, amid concerns about discontent among the electorate over the rising cost of living. Thailand’s autogas market represents 14.5pc of the country’s overall LPG consumption. The country consumed some 530,000t of LPG in the first half of 2012, according to statistics from the energy ministry.

Former Soviet UnionRussian LPG export duty increasesRussian export duty on LPG will rise by $7.30/t to $76.20/t in September, accord-ing to a draft government decree. The decree should be approved and signed by prime minister Dmitry Medvedev by the end of this month. This small change will not affect the profitability of LPG exports in September, exporters say. The export duty is calculated on an Argus daf Brest assessment basis for propane-butane mix. The duty is calculated based on assessments from the 15th of the

previous month to the 14th of the current month. The duty is set at zero if the LPG price is at, or below, $490/t daf Brest.

Tajik imports riseTajikistan’s LPG imports rose by 900t in July compared with June to 13,400t. Kazakhstan’s 160,000 b/d b/d Chimkent refinery supplied most of the imports. “The market has become more active, LPG is more popular due to the high cost of gas-oline,” a Tajik market participant says. Big LPG cargoes were shipped to Tajikistan by Russian state-controlled Gazprom subsidiary Gazpromneft Tajikistan and local firms Faroz and Khujand Neftegaz.

StatisticsOpec sees European demand contraction LPG demand in Germany, France, Italy and the UK fell by around 20pc, or 83,000 b/d, in June compared with the same month a year earlier, according to Opec’s latest Monthly Oil Market Report (MOMR). Oil demand in the four countries declined by 120,000 b/d in June compared with the same month a year earlier, owing largely to the bleak economic situation in the eurozone, with LPG contracting at the fastest rate. The eurozone economy will contract by 0.4pc this year and grow by just 0.1pc in 2013, according to Opec forecasts. The MOMR projects global oil demand to grow by around 900,000 b/d in 2012, with LPG representing 9,000 b/d, or 1pc, of this figure. Most of the growth will come from fuel oil, naphtha and gasoline, at 47pc, 16pc and 13pc, respectively. Opec natural gas liquids (NGLs) and non-conventional oil output is expected to increase by 350,000 b/d this year and by 240,000 b/d in 2013 — unchanged from the previous forecast.

North AmericaNova uses NGLsCanadian petrochemical firm Nova Chemicals has been using ethane-pro-pane mix as a feedstock to produce

ethylene at its Corunna cracker in Sarnia, Ontario. Nova is taking about 13,000 b/d of ethane-propane mix from the natu-ral gas liquids (NGL) hub at Conway, Kansas, through Enterprise Product Partners’ MidAmerican pipeline and Kinder Morgan’s Cochin pipeline. But the midcontinent connection should be a short-term solution until the Corunna cracker gets access to ethane from the Marcellus shale via the 50,000 b/d Mariner West project, which is being jointly devel-oped by midstream companies MarkWest Energy Partners and Sunoco Logistics. The pipeline is expected to go into opera-tion in July next year. Nova Chemicals reported profits of $189mn for the second quarter, down by 16pc compared with the same quarter in 2011. The decline pre-dominantly reflected depreciation of the company’s physical plants and feedstock derivative losses.

Pembina profits riseCanadian midstream company Pembina Pipeline’s profits rose by 68pc to $80.4mn in the second quarter from a year earlier, after completing its acquisition of Provident Energy in April. The rise took into account a weak North American propane market and a $12.4mn loss on commodity-related derivatives. Propane margins were weak in the second quarter because of high inventories and low prices. But strong refin-ery demand buoyed Pembina’s butane margins. Pembina’s aggregate natural gas liquids (NGLs) sales were over 90,000 b/d during the period. The NGL mid-stream assets that Pembina acquired from Provident included the Younger extrac-tion and fractionation facility in British Columbia; 65,000 b/d of fractionation capacity and 6.3mn bl of cavern storage at Redwater, north of Edmonton; a 2.1bn ft³/d (21bn m³/yr) interest in a straddle plant, which strips NGLs from the gas stream, at Empress; and 20,000 b/d of fractionation capacity and 6.4mn bl of cavern storage at Sarnia. Pembina’s overall gas processing was 16pc higher for the quarter at 285mn ft³/d, and the company is enhancing its NGL extraction capability at its midconti-nent gas processing plants.


21 August 2012Argus LPG World —

US midstream operator DCP Midstream Partners’ gross natural gas liquids (NGLs) production rose by 14pc to more than 62,500 b/d in the second quarter compared with a year earlier. But profits dipped in its wholesale pro-pane business.

The production rise came primarily from the acquisition of an 80mn ft³/d (2.3mn m³/d) cryogenic gas processing plant in east Texas and a non-operating interest in Mont Belvieu fractionation.

NGL throughput on DCP’s pipelines rose by 23pc to 75,800 b/d, and profits jumped to $79.1mn from $47.7mn a year earlier on derivative gains and lower operating expenses. NGL bought a 12.5pc non-operating interest in an Enterprise Products Partners fractiona-tor as well as 20pc in the MB1 frac-tionator operated by Oneok Partners, for a total interest of about 60,000 b/d of fractionation capacity.

But Oneok recently declared force majeure on volumes from MB1 because

of undisclosed problems with the plant, and the fractionator is expected to oper-ate at reduced capacity for an unknown period of time.

DCP’s wholesale propane business was hurt by unseasonably mild spring weather, and lost more than $3mn in the second quarter.

The partnership has been bring-ing propane to the northeast US from the midcontinent and railing volumes in from the Marcellus shale, chief executive Mark Borer told analysts in an earnings call on 14 August.

DCP is on schedule to complete a 200mn ft³/d cryogenic gas process-ing plant this year and is about 60pc covered for the year by direct product hedges, DCP executives say.

DCP’s fee-based revenue will increase to 80pc from 60pc once two midcontinent-to-Gulf coast NGL pipe-lines under construction — Southern Hills and Sand Hills — are completed in 2013, Borer says.

In brief

US inventories of propane in primary storage rose by 971,000 bl to more than 69mn bl for the week ended 10 August, nearly 13mn bl above the Energy Information Administration’s (EIA) five-year average. Midcontinent stocks fell for a second week, by 98,000 bl to 26.8mn bl. Propane inventories on the Gulf coast con-tinued to rise, gaining 939,000 bl to 33.9mn bl, a level not seen since October 2009.

US stockbuild grows

UK energy giant BP has agreed to sell its LPG distribution business in the UK to Irish firm DCC for $63mn.

The business supplies around 87,000 t/yr of LPG to industrial, com-mercial and domestic customers in the UK.

BP plans to sell $38bn of its assets by the end of this year to help meet the enormous costs associated with the 2010 Macondo oil spill in the US Gulf of Mexico. The firm has agreed around $24bn of asset sales since the start of 2010.

BP said in February that it plans to sell its LPG bottling and tank fill-ing business, as well as some of its wholesale LPG activities, in the UK, Portugal, Austria, Poland, the Netherlands, Belgium, Turkey, China and South Africa.

DCC already owns the UK’s sec-ond-largest LPG retailer and distributor Flogas. The largest retailer and distribu-tor is Calor, owned by SHV.

Irish firm buys BP unitDCP output posts gains

US propane inventories mn blRegion 3 Aug 10 Aug 12 Aug 11

East coast 5.87 5.89 4.07

Midcontinent 26.86 26.77 21.90

US Gulf coast 33.01 33.95 22.75

Rocky Mts, west coast 2.31 2.42 1.67

Propylene* 4.97 5.17 2.43

Total 68.06 69.03 50.38

*included in US Gulf coast total — EIA

US midcontinent natural gas liquids (NGLs) prices could remain relatively low for the rest of this year because of midstream capacity constraints in the region, the chief executive of US firm Copano Energy, Bruce Northcutt, says.

“NGL prices may improve slightly in the second half of 2012, but we do not expect that prices will return to levels we saw at the beginning of the year — and that basis differentials between Conway and Mont Belvieu NGLs will remain wide,” Northcutt says. “This wide differential will continue for the bal-ance of 2012 and will not improve until new NGL takeaway capacity comes on line late in 2013,” he says.

Conway prices for ethane-propane mix averaged 11¢/USG during the sec-ond quarter of this year, and fell to as low as 3.81¢/USG during the period, prompting Copano and other midcon-

tinent producers to reject ethane into the gas stream. Mont Belvieu ethane prices averaged 40.24¢/USG during the same period.

Copano reported profits of $21.1mn for the second quarter, up from a $9.3mn loss in the same period a year earlier. The Houston-based company will spend up to $300mn on expansion projects in 2013, with the bulk going to developments in south Texas. Copano projects that its 2013 earnings before taxes will be $300mn-330mn, assuming crude prices of $90.34/bl, natural gas prices of $3.80/mn Btu, and average Mont Belvieu NGL prices of $33.16/bl.

Copano is expanding its Houston Central gas processing plant by 400mn ft³/d (4bn m³/yr). The project is slated to come on line in early 2013. The firm is planning a second 400mn ft³/d expan-sion at the same facility.

Copano sees further midcontinent price weakness


21 August 2012Argus LPG World — Markets

Refrigerated propane and butane in the key northeast Asian market have inversed their traditional pricing relationship, fol-lowing unseasonably high propane demand.

Asian propane prices traditionally trade at a discount to butane from June to September as summer temperatures peak in Japan, South Korea and China — and demand for propane as a heating fuel reaches its seasonal low before winter stockbuilding begins.

At the same time, butane prices usually rise in relation to propane, as the summer drop in LPG prices boosts price-sensitive Asian demand from ethylene crackers that switch from naphtha to cheaper butane as a feedstock.

But the market has seen unseasonable prices this sum-mer, as sustained propane demand coupled with plentiful supplies of butane have resulted in an unexpected reversal of the usual trend. The Argus Far East Index (AFEI) for propane started its rise over butane on 26 July — and the premium has held for most of August.

Propped upSaudi Aramco announced its August LPG Contract Price at $775/t for propane and butane this month, but the parity between the two grades soon seemed unrepresentative of actual market conditions. Propane demand looks stronger at present than for butane — and companies are beginning to build primary stocks as autumn draws near.

“Almost all of the incremental demand that we are seeing from Japanese importers comes from winter stockbuilding requirements,” says the trading manager of a South Korean LPG importer — and such demand would consist primar-ily of propane. The relative strength of LPG compared with

naphtha this month has also curbed cracking interest from most northeast Asian petrochemical makers, with most feed-stock requirements reported to have been covered with prior naphtha purchases.

“We can consider buying September arrival butane, but it is not cheap enough yet,” the LPG purchasing manager of a Taiwan-based ethylene cracker says.

A trading source at one of Japan’s largest importers also points out that the firm has recently offered 22,000t of September-arrival butane for sale to northeast Asia but has found no buyers for butane-only cargoes.

Pro-plusThe 4.5mn t/yr autogas sector in South Korea — the world’s largest autogas market — is expected to consume greater amounts of propane in the coming months as temperatures fall, owing to butane’s higher gasification point.

Importers in Japan, South Korea and China normally build up their propane stocks from October, ahead of seasonal peaks in prices during winter from December to February.

Asian propane shifts relationship with butane

The price discount of propane at the midcontinent hub of Conway, Kansas, to the US Gulf coast hub at Mont Belvieu, Texas, has narrowed by nearly 40pc since the beginning of August, to 17.50¢/USG by mid-month.

Conway’s discount averaged 12¢/USG in 2011, before widening on average to 25¢/USG this year, largely because of NGL pipeline capacity constraints between the midcontinent and the Gulf coast, where propane exports are running at 100,000 b/d, according to midstream firm Enterprise Products Partners. Prices in the mid-continent have been further hit this year

by increasing production in the face of negligible demand during what was an unseasonably mild winter.

August’s narrower discount is the result of large buyers making big pur-chases of propane to send to the Gulf coast, as well as to overall gains in energy markets. The forward curve for propane has the differential even nar-rower at 16.50¢/USG in the fourth quar-ter of 2012 and first quarter of 2013.

The start of new pipeline capacity in 2013 means that Conway’s propane discount to Mont Belvieu will narrow to 15-20¢ in 2013, according to US mid-stream operator Oneok Partners.

Conway propane discount narrowsThe profitability of Australian coal pro-ducer Wesfarmers’ Kleenheat Gas business fell in the fiscal year to 30 June, because of lower LPG produc-tion from reduced LPG content in the Dampier-Bunbury natural gas pipeline, and softer market conditions. The firm’s 2011-12 LPG production fell by 7.2pc from a year earlier to 150,000t. But Wesfarmers saw a 3pc increase from a year earlier in its coal production for the 2011-12 financial year amid expansions at its Curragh and Bengalla mines. The firm’s resources division, Wesfarmers Resources, produced just over 14mn t of coal in the year to 30 June.

Kleenheat loses ground

2007 2008 2009 2010 2011 2012-200

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Argus Far East Index: Propane ratio to butane


21 August 2012Argus LPG World — Black Sea

Russian rail operator Oteko has begun shipments of LPG from its new Black Sea terminal in Taman, which is now the Black Sea’s largest LPG terminal, with an export capacity of 1.5mn t/yr (LPGW, 20 March, p5).

Oteko planned to ship the first LPG cargo on 18-19 August. The LPG coaster Seagas General was scheduled to load 1,000t of Russian and Kazakh origin LPG, sold by Oteko subsidiary Tamanneftegaz to Cypriot company Intergaz, the owner of the vessel.

Tamanneftegaz shipped the first oil cargo on 17 July, with the Neptune Voyage taking 80,000t of Tengiz crude.

The port of Taman is located in an ice-free deepwater area, on the most westerly part of the Russian coast of the Black Sea, at the entrance of the Sea of Azov.

Big complexTamanneftegaz is the main customer and also the operator of the Taman terminal, which is part of a wider complex including storage and export facilities of LPG, crude and oil products. Taman is located on the Taman peninsula near Cape Zhelezny Rog in Russia’s Krasnodar region.

The terminal was originally scheduled to launch in late 2010 but this was pushed back to the summer of 2011 and then again before it eventually opened this year. The World Bank’s investment arm IFC, a co-investor in the project, pro-vided a $100mn loan at the end of 2005.

The Taman terminal has a double-sided rail unloading rack for 48 LPG tanks. The storage park consists of 36 tanks of 600m³ each for storing pressurised propane and 12 tanks of 600m³ each for butane. Two berths for gas tankers allow year-round simultaneous LPG loading on two LPG coasters at depths of up to 12m.

Intergaz is a Cypriot company specialising in importing, storage, bottling and distributing LPG. The firm owns two LPG vessels — the Seagas Governor and Seagas General.

Taman starts exports

Terminal details

Berths 4

Berth capacity dwt 2x23,000, 2x100,000

Max vessel draft m 10.0-12.0

Max load rate m³/hr 2x900, 2x12,000

Taman LPG storage Capacity 28,000t

Tank type 48 x 600m³ steel bullets

Unloading arms 72

Products handled C3, C4, LPG mix

LPG exports from the Odessa terminal in the Black Sea rose by 11,700t to 67,200t in July compared with June, according to Odessa Commercial Sea Port. These were the highest exports since April — but the terminal is still los-ing custom (see table).

LPG arriving at Odessa increased to 16 vessels in July compared with 12 in June and 13 in May. All of the LPG was destined for Turkish LPG firm Aygaz. But market participants expect LPG loadings in Odessa to be lower in August because of maintenance being undertaken by the terminal’s largest

client, Chevron-led Tengizchevroil, and also at Russian gas processing plant Tobolsk-Neftekhim, whose LPG is sold by Russian LPG giant Sibur.

LPG shipments to Odessa in the first seven months of this year fell by 15pc to 438,400t from a year earlier, their lowest for this period in four years. Loadings for the whole of 2012 could reach only around 750,000t based on the figures for the first seven months, compared with nearly 840,000t in 2011.

This year’s decrease is principally the result of Sibur’s decision to start shipping LPG cargoes to the rival Black

Sea terminal at Kerch instead of to the Odessa facility.

Exports from the Ukrainian port of Ilyichevsk fell in January-July by 40,000t year-on-year to 205,000t because of the redirection of Sibur’s cargoes to Kerch.

Odessa suffers from customer defection

TURKMENISTAN

POLAND

ROMANIA

BULGARIA

TURKEY

SYRIA IRAN

UKRAINE

MOLDOVA

GEORGIA

IRAQ

KAZAKHSTAN

RUSSIA

DneprAzovSea

Black Sea

CaspianSea

AralSea

Dnestr

Don

Volg

a

Ura

l

Mediterranean Sea

Kiev

Lisichansk

Batumi Tbilisi

Yerevan

Ashkhabad

Tehran

Baghdad

Ankara

Grozny

Atyrau

Volgograd

Saratov Orenburg Orsk

Sangachal

Tikhoretsk

Mozyr

Brody

Kremenchug

Ceyhan

Odessa

BakuARMENIA

AZERBAIJAN

LPG terminalChisinau

Ilyichevsk KerchTaman

Temryuk

ArabatGulf

Kerch strait

Kerch peninsula

Kerch

Taman

Temryuk

Black Sea LPG terminals

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Odessa terminal loading '000t

Odessa terminal loading ’000t



Japan’s autogas sector is not reaching overly ambitious growth targets set by the country’s LPG retailers — and gov-ernment support remains limited.

Japan’s autogas retailers planned to add 10,000 autogas vehicles in the 2011-12 fiscal year ending 31 March to meet an objective set by the Japan LPG sales association, an industry group comprising mainly LPG wholesalers. But only 1,026 vehicles were registered, or 10.3pc of the target, the associa-tion’s latest survey shows.

The 2011 fiscal year was the second year of the associa-tion’s three-year campaign to boost the use of autogas vehi-cles within the industry. But government support for autogas has waned (LPGW, 1 May, p9).

The association requested in May 2010 that the country’s then 27,000 LPG retailers register at least one new autogas vehicle in their company fleet during the three years to 2012-13, setting a target of adding 5,000 autogas vehicles to the fleet in the first year, 10,000 in the second and 12,000 in the third. But the number of LPG retailers had fallen to 25,225 by June this year, partly because of consolidation.

The success rate in the second year of the campaign has dipped even further in percentage terms compared with the nearly 20pc achieved in the first year, when 996 autogas vehi-cles were registered. Total registrations for the first two years were only 2,022, or 13.5pc, against a target of 15,000.

Despite the disappointing registrations of the past two years, the sales association has left unchanged its 2012-13 new autogas vehicle target at 12,000. Even if it were to achieve the final year’s goal, it would still lag behind the three-year target of

27,000 vehicles. The association plans to implement another three-year campaign to promote autogas cars within the sec-tor from April 2013 to March 2016. It will decide targets for this period after the final results of the first phase are known.

“A lack of subsidies has discouraged retailers from choos-ing autogas vehicles,” an industry source says. Japan’s LPG retail business is generally operated by small-scale companies such as family-owned firms with limited capital. “It could be dif-ficult for retailers to buy even one autogas car without support from the government,” another industry source says.

Budget provisionsThe government made no budget provisions for the new fiscal year to promote autogas vehicles, despite evidence of their advantages in the aftermath of Japan’s earthquake and tsunami in 2011, which affected the production and distribution of other transport fuels (LPGW, 6 April 2011, p9). Japan’s LPG industry also failed to secure subsidies to build retail outlets, hampering the development of already insufficient infrastructure.

Autogas vehicles accounted for less than 10pc of Japanese LPG retailers’ entire fleet at the end of June, according to the sales association. Retailers own 131,653 vehicles, of which 10,569 are fuelled by autogas, with 94,311 vehicles running on gasoline, 24,766 on diesel and 2,000 using other motor fuels.

The total number of registered autogas cars in Japan was 250,109 in January this year, down by nearly 10pc from 277,437 in March 2010. The country’s autogas demand fell by 5.6pc to 1.1mn t in 2011-12 from 1.2mn t a year earlier, accord-ing to the Japan LP gas association of LPG importers.

Japan’s autogas sector misses growth targets

Autogas

Pakistan has reduced custom duties on imported equipment for LPG autogas stations to 10pc of the purchase price from 20pc to encourage and promote the use of the fuel as an alternative to compressed natural gas (CNG).

The decision was taken on 16 August by the Economic Co-ordination Committee (ECC).

The latest move is in line with the government’s strategic plan to phase out the use of CNG as a transport fuel in private vehicles and to restrict it to only public sector buses over the next three years. The country’s chronic gas shortages have prompted the govern-ment rethink.

The Pakistan LPG Association

(PLPGA) has welcomed the decision. ”Reduction in duty will certainly stimulate interest in the import of autogas-related equipment. The government also needs to focus on extracting maximum LPG from existing oil and gas fields,” the PLPGA says.

The ECC has also reduced duties on LPG conversion kits for vehicles to 10pc from 20pc, in addition to cutting duties on LPG pumps, control panels and dispensers. The ECC has rejected a proposal to lift a ban on the import of CNG cylinders and conversion kits.

The government has tasked Pakistan’s largest oil marketing com-pany, state-owned PSO, with setting up 100 LPG autogas stations by the end

of this year and up to 1,000 over the next three to five years. Private-sector oil marketer Hascol plans to set up 200 LPG autogas stations over the next five years (LPGW, 7 August, p9).

The government has allowed more than 5,000 existing retail fuel stations to set up LPG autogas filling facilities, and over 3,300 CNG stations to convert to LPG autogas stations.

The government is promoting the development of LPG air mix plants to make up some of the rising natural gas shortfalls, which now stand at around 2bn ft³/d (20bn m³/yr). Shortfalls in the supply of natural gas are expected to reach 6.5bn ft³/d by 2020 if no new sources of gas are secured.

Pakistan eases duty on autogas equipment imports



One European scientist sees a clear clean fuel advantage when considering autogas against conventional transport fuels and rival compressed natural gas (CNG) for the western European transport sector.

“Natural gas companies have always been preaching laboratory data to politicians to prove that CNG is the cleanest fuel for spark-ignited engines,” Professor Thomas Heinze from the Saarland University of Applied Sciences in Germany says. “I want to show that the reality is different from the lab, and that LPG is one of the cleanest of all realistic options,” he says.

Heinze has recently updated his research paper Well-To-Wheel (WTW) Analysis of Gas Vehicles, which was first pub-lished in 2010. The paper compares the WTW carbon footprint of autogas and CNG compared with a gasoline baseline.

WTW is an analytical framework that assesses the carbon footprint of a fuel not just by its engine combustion emissions, but also the energy consumption of the entire production and transport chain.

“Once you factor in the energy consumed in piping gas over long distances, compression at the distribution station, as

well as the actual emissions on the road, CNG’s environmental profile deteriorates and at some point its carbon performance gets overtaken by that of LPG,” Heinze says.

Another key factor often overlooked by CNG proponents is the additional energy consumption by CNG cars because of the weight of CNG engines and fuel systems. An average CNG system weighs around 150kg, whereas an average LPG system weighs 35-70kg. Additional weight means additional energy consumption when the vehicle is on the road.

Heinze finds that the compression process used in the long-distance pipeline transport of CNG consumes a relatively high amount of energy compared with the transport of bulk LPG in western Europe through shipping and road transport.

The research paper says that, with the additional system weight and the piping energy consumption factored in, CNG loses its superior environmental performance to LPG — if the overall WTW transport distance exceeds 2,350km.

At that distance, CNG’s CO2 emissions reduction com-pared with gasoline and based on the transport of North Sea gas to western Europe drops from 18pc to 15.2pc, putting it on a par with LPG.

Emissions advantageBeyond these distances, CNG’s emissions advantage contin-ues to deteriorate. At long WTW distances of around 7,000km — which would equate to shipping gas from fields in far east-ern Russia to western Europe — CNG conserves only a 2pc CO2 emissions advantage compared with gasoline.

This is a crucial finding, because “all CNG used in cars in western Europe is sourced from a distance further than 2,350km,” Heinze says.

The paper does not provide an exact figure for the average transport distance of gas supplies to western Europe. But it argues that the more closely sourced gas from the North Sea is already used up for the heating and power generation sec-tors. “This means that LPG is the cleanest gas car fuel with the best WTW emissions in western Europe,” Heinze says.

The calculation of the carbon performance of CNG and LPG as automotive fuels is based on new gas-fuelled car models commercially available in Germany in 2010. “When it comes to evaluating environmental performance of fuels we need to look at the comprehensive picture that includes transportation as well as combustion. The reality of logistics, once factored in, changes the conclusion we get from lab experiments,” Heinze says.

The European autogas sector, including Russia and Turkey, consumes around 38,000 t/yr of LPG.

Autogas impresses academic

Autogas

Autogas compares favourably with compressed natural gas (CNG) in western Europe, considering:• All CNG needed as automotive fuel in western Europe

will have to come from sources further than 2,350km, as production from closer sources is already dedicated to heating and generation.

• CNG systems in automobiles, including the fuel tanks, weigh up to three times more than LPG systems. The energy consumption while a vehicle is on the road because of the additional weight reduces the carbon per-formance of CNG compared with LPG.

• Laboratory studies suggest that the combustion of CNG in an engine emits 19pc less CO2 than that of gasoline. The burning of autogas emits 9.2pc less CO2 than gaso-line. The total CO2 reduction achieved by LPG is therefore less than that of CNG, without taking into account the wellhead-to-wheel carbon footprint.

• Autogas produces lower tailpipe emissions than conven-tional automotive fuels gasoline and diesel.

• Autogas engines emit less nitrogen oxide (NOx), CO2.

• Autogas engines have a better cold start performance than gasoline engines.

• Autogas emits less NOx, less particulates than diesel.

Autogas, CNG and conventional fuels

A scientific study by a German academic has found that autogas is a cleaner fuel compared with compressed natural gas (CNG) when factoring in the energy consumption of the CNG production and distribution chain from wellhead to wheel



European propane prices have surged this month as North Sea terminal and refinery maintenance and limited imports have dramatically reduced spot supply.

Benchmark large cargo propane prices cif Amsterdam-Rotterdam-Antwerp (ARA) have risen above $970/t — up by $140/t since the beginning of August.

The price rise is not typical of European propane markets for this time of year — and has sparked panic among trading firms and distributors looking for cargoes to fill storage facilities ahead of winter demand for propane as a heating fuel.

A complete shutdown scheduled at the ExxonMobil-operated Braefoot Bay terminal in the UK over 23 August to 9 September will remove several large cargoes from the market in August and September. The North Sea’s second-largest export terminal after Karsto typically exports over 100,000 t/month of mainly propane.

Kollsnes shutdownA four-week shutdown at the Gassco-operated Kollsnes gas processing plant in Noway at the end of August as a result of Norwegian field maintenance is also expected to remove around 100,000t from the North Sea market next month. Current processing capacity of the plant is 143mn m³/d of gas and 69,000 b/d of natural gas liquids (NGLs).

Planned refinery maintenance in northwest Europe will idle 821,000 b/d or 9pc of total refining capacity in northwest Europe during September and 533,000 b/d of capacity dur-ing the fourth quarter of 2012. The aggressive rationalisation of northwest European refining capacity, kick-started by the insolvency of Europe’s largest independent refiner Petroplus, has already resulted in the loss of nearly 490,000 b/d, or just over 5pc of northwest Europe’s total refining capacity of 9.28mn b/d during the first six months of this year, according to Argus estimates.

“Propane is tight, particularly on the prompt, because of refinery and North Sea maintenance,” says a prominent European broker. “Petrochemical sector demand is at a mini-mum because there is little advantage in cracking propane. Prices are unusually high for the time of year and I expect this to go on into September, as there is no evidence of arbitrage cargoes on the horizon,” the broker says.

European propane is trading above naphtha for the first time since February, when winter demand pushed prices above $1,000t (LPGW, 14 February, p8). Propane was around 83pc of the value of naphtha at the start of July and 95pc at the beginning of August (see graph).

Propane’s premium to naphtha removes a significant amount of potential demand from the petrochemical sector for propane as a feedstock alternative to naphtha. The floor price for propane is guaranteed by demand from the pet-rochemical sector — typically achieved when propane falls

below 90pc of the value of naphtha. Other short-term factors affecting overall European supply

availability include the lack of US arbitrage supply, as a result of increased demand in Latin America and Asia-Pacific, and delays to loadings of west African cargoes (see p10).

European propane in tight supply

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• The Kollsnes gas processing plant in Norway is operated by the Gassco consortium.

• Kollsnes processes NGLs from the Troll, Kvitebjorn, Visund and Fram fields, which are then transported by pipeline to the Mongstad refining and processing com-plex via the Vestprosess system for fractionation into propane and butane.

• Mongstad boasts LPG storage of 30,000t of propane and 30,000t of butane and is Norway’s second-largest LPG export facility after Karsto. The terminal has the capacity to handle up to 1.4mn t/yr of LPG exports.

• The UK’s Braefoot Bay is the second-largest export termi-nal of the North Sea.

• LPG is sent by pipeline to Braefoot Bay following frac-tionation of natural gas liquids (NGLs) at the neighbouring Mossmorran NGL fractionation plant, in Fife. Braefoot Bay boasts LPG storage of 98,000t, comprising 58,000t of propane and 40,000t of butane.

Kollsnes and Braefoot Bay



US companies with term contracts to export LPG from the US Gulf coast continue to look at sales options to Asia-Pacific, even as the arbitrage with Europe widens.

Market participants say only one US term cargo has been diverted from Latin America to Japan so far, but buyers are eyeing more. Latin America is traditionally the largest buyer of propane from the US Gulf coast.

The premium of northwest European propane to the US natural gas liquids (NGL) trading hub of Mont Belvieu in Texas has soared from $229.50/t to around $469/since the beginning of July. But at the same time, the arbitrage between the US and Asia-Pacific markets has widened from $236.50/t to $467/t.

OversupplyRising US propane production, coupled with constraints on export capacity and a mild winter in 2011-12 have created a chronic oversupply in the US, driving spot propane prices at Mont Belvieu to only 42pc of crude, compared with around 74pc in the same period last year.

This month, European propane has risen above naphtha for the first time since February (see p9). This in theory should limit demand from Europe’s petrochemical buyers. But such is the shortfall of propane in northwest Europe that European buyers look to be bidding US propane cargoes higher, above the usual premium for freight, in order to secure cargoes away from Asia-Pacific. “Even European buyers are paying a pre-

mium over ARA,” a US trader says. Yet most market participants in the US attribute the

increase in European prices to upcoming maintenance at North Sea production facilities, as opposed to competing demand from international buyers.

“We’re not seeing a lot of diversions of supply” to Asia-Pacific, an international trader says. “The market in Europe is pretty good, so we’re not seeing a lot motivation there.”

Regardless of the source of the demand, the widening differential between the US and Europe is reverberating in other markets — South American buyers of US propane must pay a roughly 60¢/USG premium to Mont Belvieu, up from 50¢/USG in July, and one buyer estimated that the price could be as high as 80¢/USG in August.

US propane sees export opportunities

Low refinery runs and surging demand for butane in the Mediterranean have led to a strengthening of fob butane prices in that region, and opened up the arbi-trage for cheaper cargoes to move to the region from northwest Europe.

Demand for butane is consistently strong in key north African LPG con-sumers Morocco and Egypt. But the start of the month-long Islamic religious observance of Ramadan in July sparked demand for additional supply and exac-erbated an already tight butane market in the Mediterranean.

The absence of supply, particularly at the region’s main refining hub of Lavera, led trading firms to look to secure butane from refineries in north-west Europe in order to supply the Mediterranean market.

Berthing delays reported at ports in

Morocco in July have led some trading firms to increase imports to the country by around 50pc over the usual summer average. Morocco imports some 1.8mn t/yr of butane, according to industry estimates, while yearly butane imports to Egypt total 1.5mn t.

Butane was being shipped south at the beginning of August from refineries such as ExxonMobil’s 310,000 b/d Fawley refinery in the UK, Preem’s 106,000 b/d Gothenburg refinery on Sweden’s west coast, and SHV’s Immingham storage facility in the UK.

Fob Mediterranean butane coaster prices rose from around $675/t to as high as $895/t between July and mid-August. And cif Mediterranean butane prices rose to $845/t in mid-August from $624/t at the start of July. But demand in the Mediterranean over the Ramadan

period has not been strong everywhere. Ramadan observance has led to slow-ing autogas demand in Turkey, accord-ing to some traders there.

Meanwhile, Turkish demand for butane cylinders for cooking and heating purposes has waned over the summer, part of a longer-term decline in domestic demand as a result of the encroachment of natural gas as a domestic fuel in the country’s urban centres.

Mediterranean butane demand surges


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Greek LPG shipping firm Stealthgas posted a large jump in profits for the first six months of 2012 on higher charter rates for LPG coasters. The company’s profits stood at $14.6mn for the first six months, compared with a loss of $2.1mn for the same period in 2011. Profits for the second quarter alone rose to $7.2mn compared with a net loss of $3.6mn in the second quarter of last

year. The gains came despite weaker revenues for the first six months of this year compared with 2011.

Stealthgas attributed the improved results to lower voyage and operating costs, the sale of a vessel, lower deriva-tive losses and higher charter rates for LPG vessels. Revenues fell because of the company’s fleet size decreasing by two vessels.

Shipping ratesThe very large gas carrier market saw more activity west of Suez, with vessels being booked from Houston and west Africa, but relatively little activity east of Suez. Indian demand is strong, and this is one of many per-sistently bullish influences encourag-ing vessel owners to aim for rates of $80/t and above for the Mideast Gulf to Japan route.

Shipping/infrastructure news

Shipping ratesSpot $/t

44,000t Mideast Gulf/Japan 77.00

4,000t UKEC/Mohamedia 80.00

1,800t Tees/ARA 37.00

1,800t Tees/Lisbon 88.00

— EA Gibson

Shipping rates12-month time charter $/calendar month

78,000m³ nc 1,200,000

59,000m³ nc 950,000

35,000m³ 825,000

5,000m³ (west) nc 315,000

3,500m³ pressurised (west) 260,000

3,500m³ pressurised (east) 240,000

US ethylene plant gross margins ¢/lb of ethylene

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Natural gasoline Naphtha

Purvin & Gertz: ethylene plant gross margins (Mont Belvieu, Texas)¢/pound of ethylene

— Purvin & Gertz

Ethylene plant gross margins (Mont Belvieu, Texas) ¢/lb of ethylene

NGL economics/shipping

Ethylene plant total variable cash cost*19 Jul 26 Jul 2 Aug 9 Aug 16 Aug

Ethane (E/P mix) 11.50 10.67 10.38 10.61 9.50

Purity ethane 12.27 11.72 11.42 12.38 11.27

Propane 15.34 14.37 13.00 15.69 17.13

N-Butane 26.02 26.03 23.07 26.79 32.20

Natural gasoline 35.74 36.34 38.09 43.85 50.14

Naphtha 33.39 34.83 38.19 43.24 49.98

Gasoil 51.61 53.10 52.91 59.17 61.68

*at Mont Belvieu, Texas — Purvin & Gertz

Ethylene plant gross margins* (graph below)19 Jul 26 Jul 2 Aug 9 Aug 16 Aug

Ethane (E/P mix) 33.55 35.19 35.04 35.81 39.54

Purity ethane 32.78 34.14 34.00 34.03 37.77

Propane 29.70 31.49 32.42 30.73 31.91

N-Butane 18.95 19.75 22.27 19.55 16.77

Natural gasoline 8.17 8.38 6.20 1.43 -2.23

Naphtha 10.51 9.88 6.08 2.03 -2.09

Gasoil -7.71 -8.39 -8.64 -13.90 -13.79

*at Mont Belvieu, Texas — Purvin & Gertz



European butane

• Large cargo cif Amsterdam-Rotterdam-Antwerp (ARA) prices rose in line with gains in crude and naphtha to reach $871/t, around $41/t higher than at the start of August.

• Butane’s value relative to naphtha remained steady at 92pc, as product tightness eased.

• Coaster prices on a cif basis rose by over $30/t to around $843/t, buoyed by recent gains in naphtha’s physi-cal value. But prices eased from a high of almost $860/t in mid-August amid thinner demand. Fob coaster prices rose by almost $40/t to around $807/t to reflect changes in freight rates.

• Fob Mediterranean butane coaster prices rose by $60/t to settle at around $895/t, reflecting a lack of supply and strong demand for butane in the Mediterranean region. Recent gains in naphtha’s value in northwest Europe further supported prices.

• Barge prices rose by over $50/t to $837.5/t fob ARA for the second week of August.

European propane

• Large cargo cif Amsterdam-Rotterdam-Antwerp (ARA) propane prices carried on rising in the first two weeks of August.

• Planned North Sea terminal and refinery maintenance in August and September kept the market tight — with several buyers and no sellers on the spot market continuing to sup-port prices (see p9).

• Large cargo prices fell to $945/t by mid-month after briefly reaching $960/t, a leap of $112/t from $848/t cif ARA at the start of the month.

• Propane is now trading above naphtha for the first time since February.

• Coaster prices rose by around $100/t to $875/t fob northwest Europe, reflecting strength on the large cargo markets.

• Inland ARA barge prices jumped by $145/t fob ARA to $930/t fob ARA in the first half of August.

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Asian butane

• Asian butane prices rose but its discount to propane widened, amid limited regional demand. Regional eth-ylene producers could start to consider butane as an alternative feedstock to naphtha should butane prices weaken further.

• In the pressurised market, Taiwanese state-owned refiner CPC sold via tender two 1,800-2,000t pressurised parcels loading on 6-15 September and 16-25 September with ratios of 20-30:70-80 propane:butane to trading firms at the September Saudi Contract Price (CP) plus $60-65/t fob Kaohsiung.

• The Taiwanese cargoes had a relatively high olefin content, and were valued at a discount to cargoes from south China, which were sold at prices ranging from the August CP plus $100-110/t to the September CP plus $80-85/t fob.

• Vietnam importer Saigon Petro awarded its tender to buy 900t of pressurised LPG arriving on 11-13 September to a domestic trading company.

Asian propane

• Asian propane prices rose in line with higher crude values. Sentiment remained bullish, reflecting tight availability of pro-pane for September delivery. But recent fob sales from the Mideast Gulf have started to weigh on sentiment.

• Qatar’s Tasweeq sold a mixed 44,000t cargo at $840/t for 24-25 August loading and another at $870/t for end-August loading on a fob basis. Tasweeq also sold a mixed 44,000t cargo to a western trading firm at a $10/t premium to the Saudi Aramco September contract price (CP) for end-August loading from Ras Laffan.

• A European trading firm sold a mixed propane-heavy 44,000t cargo at September CP plus $8/t fob Ras Laffan.

• Kuwait’s KPC sold a mixed propane-heavy 44,000t cargo to a northeast Asian importer at September CP plus $11/t for 21-22 September loading from Mina al-Ahmadi.

• Thailand’s PTT secured a mixed 44,000t cargo at September CP plus $68/t for 4-5 September cfr arrival to the port of Sriracha.

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Americas propane

• Spot prices at the US trading hub of Mont Belvieu, Texas, rose during the first half of August, moving from 87.56¢/USG to 93.40¢/USG by 17 August.

• Gains in outright prices for US propane values lagged the rally in crude prices, and front-month demand for pro-pane from petrochemical buyers was limited.

• Propane’s value relative to crude weakened slightly, from 42pc at the start of the month to around 41pc by 17 August.

• Propane’s forward price contango — prompt prices below forward values — on the Gulf coast deepened slightly in mid-August, with fourth-quarter volumes trading at a roughly 3¢/USG premium to August.

• Propane at the Conway, Kansas, hub surged by 16pc over the first half of August to around 82.50¢/USG in active trading, narrowing its discount to Mont Belvieu to around 10.50¢/USG by 17 August. Differentials narrowed as more pipeline capacity became available.

Americas butane and ethane

• Ethane prices at Mont Belvieu remained rangebound during the first half of August, moving from 36.75¢/USG on 1 August to 35.12¢/USG by 17 August.

• Trading in ethane was subdued, and the feedstock averaged 16.7pc of the value of US benchmark crude WTI at the start of the month, compared with 36pc during the same period last year.

• Ethane’s price relative to propane fell from 42pc to 37.5pc in the first half of August.

• Normal butane prices at Mont Belvieu rose sharply dur-ing the first half of August, from 131.13¢/USG to 154.37¢/USG by 17 August.

• Mont Belvieu butane’s value relative to WTI crude soared from 62pc to 67.5pc over the period.

• Butane at Conway spiked by nearly 20¢/USG to 180.50¢/USG in five consecutive days of trading to 17 August, reflecting demand from gasoline blenders.

Markets

Jan Apr Jul Oct70

90

110

130

150

170

201020112012

Propane Mont Belvieu non-LDH ¢/USGPropane Mont Belvieu non-LST ¢/USG

Jan Apr Jul Oct400

600

800

1,000

1,200

201020112012

Propane US Gulf coast import $/tPropane US Gulf coast import $/t

Jan 11 Apr Jul Oct Jan 12 Apr Jul1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

Propane

Butane

Mont Belvieu propane and butane ratios to ethanePropane and butane ratios to ethane

Jan Apr Jul Oct20

40

60

80

100

201020112012

Ethane Mont Belvieu ¢/USGEthane Mont Belvieu ¢/USG



INTERNATIONAL LPG

Markets

Apr 11 Jul Oct Jan 12 Apr Jul500

600

700

800

900

1,000

1,100

1,200

1,300

Saudi ArabiaAlgeriaNorth Sea

Propane export prices Saudi, Algeria, North Sea $/tPropane export prices Saudi, Algeria, North Sea $/t

Apr 11 Jul Oct Jan 12 Apr Jul400

600

800

1,000

1,200

1,400

NWEUSGCJapan

Propane NWE, USGC, Japan $/tPropane NWE, US Gulf coast, Japan $/t

Naphtha $/tJul 11 Aug Sep Oct Nov Dec Jan 12 Feb Mar Apr May Jun Jul

Cargoes cif NWE 979.38 939.55 940.53 882.48 865.59 876.75 949.60 1,029.17 1,068.64 1,029.61 877.61 730.66 826.15

Cargoes c+f Japan 974.32 946.11 946.70 883.55 578.35 902.54 955.56 1,032.07 1,074.01 1,035.56 897.81 746.32 833.72

Ethane ¢/USGJul 11 Aug Sep Oct Nov Dec Jan 12 Feb Mar Apr May Jun Jul

Mont Belvieu 81.75 73.86 79.33 90.05 87.42 80.77 66.71 49.62 53.05 49.56 41.75 30.33 34.77

Chinese domestic prices yuan/tJul 11 Aug Sep Oct Nov Dec Jan 12 Feb Mar Apr May Jun Jul

East China terminal

Ningbo ex terminal 6,713 6,721 6,657 6,210 6,121 6,312 6,620 7,393 8,346 7,603 6,517 5,542 5,905

Wenzhou ex terminal 6,731 6,721 6,686 6,463 6,350 6,350 6,617 7,393 8,507 7,706 6,925 5,958 6,100

Taicang ex terminal 6,713 6,721 6,671 6,210 6,121 6,312 6,620 7,393 8,507 7,603 6,531 5,542 5,894

Shanghai ex terminal 6,745 6,743 6,695 6,370 6,221 6,374 6,618 7,354 8,575 7,641 6,891 5,604 5,902

Zhangjiagang ex terminal 6,713 6,721 6,664 6,210 6,121 6,312 6,620 7,393 8,507 7,603 6,531 5,543 5,905

Fujian ex terminal 7,025 7,018 6,642 6,467 6,400 6,400 6,643 7,393 8,641 7,856 7,450 6,500 6,273

East China refinery

Shanghai ex refinery 6,004 6,070 6,381 5,770 5,879 6,041 5,743 6,388 7,405 7,244 5,864 5,340 5,893

Zhenhai ex refinery 6,360 6,294 6,612 6,022 6,136 6,352 6,161 6,783 7,766 7,465 6,213 5,648 6,139

Yangzi ex refinery 5,956 5,964 6,292 5,737 5,841 6,006 5,778 6,365 7,320 7,071 5,858 5,291 5,826

Fujian ex refinery 6,355 6,302 6,396 5,908 5,999 6,282 6,318 6,744 7,562 7,150 6,091 5,369 5,764

Gaoqiao ex refinery 5,894 5,965 6,242 5,699 5,769 5,854 5,624 6,263 7,423 7,150 5,806 5,183 5,701

South China terminal

Zhuhai ex terminal 6,968 6,767 6,606 6,253 6,267 6,444 6,785 7,489 8,641 7,842 6,580 5,859 6,196

Shenzhen ex terminal 7,088 6,883 6,712 6,388 6,360 6,473 6,795 7,499 8,647 7,891 6,771 5,894 6,250

Raoping ex terminal 6,764 6,285 6,342 5,908 6,035 6,295 6,505 7,185 8,341 7,319 6,030 5,335 5,734

Nansha ex terminal 7,087 6,848 6,660 6,328 6,348 6,458 6,812 7,506 8,681 7,884 6,796 5,810 6,216

Shantou ex terminal 6,338 6,256 6,271 5,825 5,880 6,260 6,505 7,187 8,568 7,319 6,164 5,368 5,734

Yangjiang ex terminal 6,479 6,369 6,443 6,143 6,073 6,280 6,462 6,945 7,626 7,268 6,110 5,424 5,963

South China refinery

Maoming ex refinery 6,415 6,284 6,441 6,182 6,110 6,349 6,410 6,881 7,640 7,339 6,175 5,500 5,964

Guangzhou ex refinery 6,455 6,387 6,515 6,192 6,148 6,366 6,434 6,964 7,788 7,328 6,156 5,457 6,016

Northeast China refinery

Daqing ex refinery 5,169 5,233 5,498 5,710 5,269 6,349 5,203 5,345 6,291 6,609 6,009 4,918 5,150

Dalian ex refinery 5,699 5,900 6,193 6,003 5,798 6,366 5,850 6,105 7,109 7,463 6,123 5,135 5,627

Northwest China refinery

Urumqi ex refinery 4,361 4,451 4,424 4,570 4,126 4,107 4,150 4,226 5,089 5,350 4,950 4,663 4,641

Inland China refinery

Lanzhou ex refinery 5,594 5,727 5,832 5,903 5,550 5,512 5,530 5,724 6,689 6,781 5,482 4,900 5,271

Yan-An ex refinery 5,543 5,470 5,875 5,456 5,279 5,451 5,278 5,771 6,643 6,528 5,360 4,663 5,318


21 August 2012Argus LPG World — Prices monthly

PropaneAug 11 Sep Oct Nov Dec Jan 12 Feb Mar Apr May Jun Jul Aug

Middle East $/t

Saudi Arabia 835.00 790.00 735.00 750.00 770.00 850.00 1,010.00 1,230.00 990.00 810.00 680.00 575.00 775.00

Kuwait 835.00 790.00 735.00 750.00 770.00 850.00 1,010.00 1,230.00 990.00 810.00 680.00 575.00 775.00

Mediterranean $/t

Algeria (Sonatrach) 880.00 830.00 770.00 775.00 790.00 810.00 950.00 1,160.00 955.00 815.00 660.00 580.00 765.00

Spot prices $/t

Large cargo cif ARA 847.84 828.43 780.79 804.25 820.58 887.50 1,030.76 1,032.77 921.13 714.66 610.16 756.27

Large cargo cif Lavera 837.84 816.73 768.21 791.32 807.95 873.02 1,034.57 1,031.02 915.13 731.14 625.71 773.36

Large cargo USGC 790.59 807.10 760.79 753.48 721.00 668.65 629.73 na na na na na

Large cargo Japan CFR 832.74 800.02 777.88 821.79 846.95 968.82 1,121.12 1,123.98 924.33 756.21 654.33 774.39

Large cargo East China CFR 832.74 799.48 776.68 821.41 845.29 968.82 1,121.12 1,123.98 924.33 756.21 653.48 774.39

Large cargo South China CFR 832.74 799.02 775.48 821.17 843.62 968.82 1,121.12 1,123.98 924.33 756.21 652.91 774.39

Large cargo Far East Index 832.74 799.52 776.68 821.48 845.29 968.82 1,121.12 1,123.98 924.33 756.21 653.62 774.39

Asia spot premiums to CP $/t

Mideast Gulf -2.52 -2.23 -2.00 4.10 4.26 -3.79 -35.88 -51.00 -20.70 -26.52 -22.43 11.96

South China (pressurised) 84.55 87.35 90.65 92.07 101.76 99.45 82.79 53.02 83.93 82.59 93.64 139.64

East China (refrigerated) 6.07 21.80 39.73 68.02 65.10 83.03 81.12 -61.11 -32.33 -23.98 -0.29 158.89

South China (refrigerated) 6.07 21.34 38.63 67.79 63.43 83.03 81.12 -61.11 -32.33 -23.98 -0.86 158.89

Taiwan 27.55 29.05 41.93 62.21 56.00 57.55 52.45 3.18 28.13 31.93 41.33 91.71

Japan 27.55 29.57 43.03 62.45 56.86 57.55 52.45 3.18 28.13 31.93 41.33 91.71

Mont Belvieu ¢/USG

LST 152.88 156.02 147.16 145.77 139.56 129.51 122.06 125.91 119.39 95.01 78.62 87.40

Non-LST 153.00 156.15 147.19 145.60 139.18 129.15 122.27 126.15 119.47 94.94 78.17 87.26

Europe $/t

Coasters fob NWE 777.14 784.09 780.81 773.36 800.48 846.43 977.14 981.71 888.03 669.55 561.58 698.30

Barges fob NWE 882.84 860.80 789.10 816.25 821.00 859.05 1,088.45 1,078.11 959.68 711.59 623.37 775.75

Coasters fob Med 812.93 870.80 837.40 823.68 798.00 882.26 1,047.74 1,042.73 936.58 762.61 619.74 737.96

ButaneAug 11 Sep Oct Nov Dec Jan 12 Feb Mar Apr May Jun Jul Aug

Middle East $/t

Saudi Arabia 885.00 865.00 815.00 810.00 820.00 910.00 1,040.00 1,180.00 995.00 895.00 765.00 620.00 775.00

Kuwait 885.00 865.00 815.00 810.00 820.00 910.00 1,040.00 1,180.00 995.00 895.00 765.00 620.00 775.00

Mediterranean $/t

Algeria (Sonatrach) 915.00 915.00 865.00 820.00 830.00 910.00 1,005.00 1,110.00 1,005.00 940.00 690.00 590.00 760.00

Spot prices $/t

Large cargo cif ARA 889.05 901.41 841.71 820.68 842.05 948.93 1,002.40 1,029.55 983.84 794.77 601.58 722.55

Large cargo cif Lavera 905.05 919.89 861.60 838.36 865.93 988.36 1,043.55 1,058.14 1,016.11 836.52 620.87 750.23

Large cargo USGC 804.07 845.90 783.62 792.75 893.67 872.35 809.28 na na na na na

Large cargo Japan CFR 908.83 880.09 835.63 862.55 898.52 1,015.21 1,062.14 1,085.91 992.63 850.75 705.33 799.77

Large cargo East China CFR 908.83 880.09 834.43 862.17 896.86 1,015.21 1,062.14 1,085.91 992.63 850.75 704.48 799.77

Large cargo South China CFR 908.83 880.09 833.23 861.93 895.19 1,015.21 1,062.14 1,085.91 992.63 850.75 703.91 799.77

Large cargo Far East Index 908.83 880.09 834.43 862.24 896.86 1,015.21 1,062.14 1,085.91 992.63 850.75 704.62 799.77

Asia spot premiums to CP $/t

Mideast Gulf 1.69 3.07 -1.93 5.38 5.12 -2.37 -35.88 -51.00 -19.95 -14.77 -17.55 14.36

India cfr 27.36 20.73 15.90 46.74 55.67 53.87 1.00 -47.21 38.25 -4.16 4.43 102.18

South China (pressurised) 83.83 88.18 90.65 97.31 101.76 99.45 82.79 53.02 79.43 82.14 93.64 139.64

East China (refrigerated) 28.83 27.14 22.83 51.88 65.71 77.66 4.98 -61.46 17.23 -14.57 -23.76 147.82

South China (refrigerated) 28.83 27.14 21.63 51.64 64.05 77.66 4.98 -61.46 17.23 -14.57 -24.33 147.82

Taiwan 51.02 31.50 35.10 53.69 56.00 54.34 24.33 -5.89 45.75 37.73 36.91 86.34

Japan 51.02 31.50 36.20 53.93 56.86 54.34 24.33 -5.89 45.75 37.73 36.91 86.34

Mont Belvieu ¢/USG

LST 181.49 190.76 176.99 179.01 201.29 196.58 182.65 185.52 178.81 154.77 117.37 123.31

Non-LST 186.20 191.96 180.59 182.37 203.09 197.63 187.64 192.86 191.09 165.05 128.60 133.02

Europe $/t

Coasters fob NWE 816.25 879.30 822.86 785.57 812.30 961.86 965.00 959.57 922.95 737.98 540.87 668.09

Barges fob NWE 864.75 884.80 842.93 800.55 823.25 932.00 955.31 995.27 953.74 759.32 576.82 688.48

Coasters fob Med 955.86 938.59 883.02 904.02 904.13 1,037.14 1,115.00 1,073.75 1,066.05 901.18 674.47 796.27

Documents

LPG World - Argus Media€¦ · © 2012 Argus Media Ltd Page 2 Argus LPG World 21 August 2012 Europe’s network of refineries is both a source of LPG supply and demand, using LPG