01 August 2013 22:58 [Source: ICIS news]
HOUSTON (ICIS)--US ethane prices have plunged in the past year as supplies continue to outpace demand, US-based Enterprise Products said on Thursday.
The average spot price of ethane for the week ending 3 August 2012 was 36.56 cents/gal. Thursday's spot price was 25.38 cents/gal, down 31%.
Prices have been been in the mid-20s cent/gal range for most of the year, yet production has continued.
Enterprise chief operating officer AJ Teague said ethane is trading at fuel value, meaning it is just as valuable being left in the natural gas stream and sold to heat and power homes and businesses. This phenomenon is called ethane rejection.
"NGL prices have really suffered, as demand has not been able to keep up with the rapidly growing supplies from the shale plays," he said during the company's second-quarter earnings call. "Led by ethane falling apart, ethane is now in the firmly in the excess category."
Anthoney Chovanec, an Enterprise vice president, said the company's level of ethane rejection is "north of 200,000 bbl/day".
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