Future export terminals to raise US propane prices: Gallogly

30 September 2013 22:44  [Source: ICIS news]

HOUSTON (ICIS)--US prices for propane and butane will likely rise as companies in the country complete export terminals that could ship out the natural gas liquids (NGLs), the CEO of LyondellBasell said on Monday.

US prices for propane had fallen because of the advent of shale gas, which increased supplies of the NGL.

At the same time, the US has lacked the terminals to export propane to markets overseas, said Jim Gallogly, LyondellBasell CEO. "Now, of course, midstream companies and oil companies are going to solve that problem by putting export facilities in place.

Gallogly made his comments on the sidelines of the opening ceremony of the Houston Technology Center, a new research and development (R&D) site.

Once the export facilities are built, propane prices should rise and reflect those for crude, he said.

Ethane prices should remain low because it is not easily exported overseas, Gallogly said.

In fact, ethane has traded at fuel level, 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.

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By: Al Greenwood
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