It could be a natural next step. The Houston-based company already exports ethane, LPG and propylene from its facility at Morgan's Point, Texas. Barbours Cut, shown above, connects the area to the mouth of the Houston Ship Channel. (Port of Houston Authority)
The company discussed the possibility during an investor presentation earlier this week at the Citi MLP/Midstream Infrastructure Conference. It did not immediately respond to a request for additional comments on Thursday.
Enterprise said the economics for ethylene exports are very similar to those for ethane, which it started exporting from its terminal at Morgan's Point, Texas, on the Houston Ship Channel earlier this year.
In addition, it would be a natural step from the company's current exports of LPG and ethane, Enterprise said.
Such exports could address an upcoming oversupply of ethylene, Enterprise said. Several companies are building new crackers and expanding existing ones.
In all, Enterprise estimates that the build-out will increase US ethylene capacity by 40% and exceed domestic demand.
Meanwhile, Asian demand for ethylene continues to grow faster than production, Enterprise said. The region is looking to diversify its supplies of the monomer with US-advantaged feedstock.
The US relies predominantly on ethane as a feedstock for its crackers, giving it a cost advantage against much of the world, which relies on oil-based naphtha.
An ethylene terminal also would be able to export any natural gas liquid (NGL), giving it flexibility, Enterprise said.
The company has similar flexibility with its LPG terminal on the Houston Ship Channel, which can also handle polymer-grade propylene (PGP). Enterprise can load 5,000 tonnes/day of refrigerated PGP at the dock. Shipments so far have gone to other parts of the Western Hemisphere.
In related news, Enterprise continues to expect US ethane supplies to be adequate to meet demand. However, within the US, the Gulf Coast will be short of NGLs.
Ethane from the northeast alone cannot meet the increase in demand from the US Gulf, Enterprise said. It expects that ethane from the western US also will be used to meet the increase in demand.
Enterprise itself has flexibility in meeting this new demand.
Its Appalachia-to-Texas Express (ATEX) pipeline is connected to four fractionators in the US northeast and can ship up to 125,000 bbl/day of ethane to the Gulf Coast, the company said.
Enterprise can expand the pipeline to 265,000 bbl/day, although this would require additional long-term agreements and 18 months, the company said.
Enterprise could also convert the Centennial pipeline from refined products to NGLs. Enterprise and Marathon Petroleum each own 50% stakes in the pipeline.
Centennial connects Beaumont, Texas, to Bourbon, Illinois, 800 miles (1,300 km) away. A combination of new construction and repurposing could allow this pipeline to reach fractionators in the northeast.
The repurposed Centennial pipeline could have an NGL capacity of up to 230,000 bbl/day, Enterprise said. Construction would take 18-24 months.
Enterprise said it is still evaluating the project.
INSET IMAGE: A common liquid chemical tanker. (Michael Dietrich / imageBROKER/REX/Shutterstock)