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LPGASWIRE
Volume 36 / Issue 252 / December 23, 2014

Asia LPG ($/mt) (PGL page 2780) Market Commentary

Code Mid Change Code Mid Change
CFR Refrigerated Diffs to Saudi CP strip Asia LPG (PGL page 2798)
11:11 Singapore-Japan (H2 Jan) AASGO00 486.000 -9.000
11:11 Singapore-Japan (H1 Feb) AASGP00 486.000 -9.000
11:11 Singapore-Japan (H2 Feb) AASGQ00 485.000 -9.000 While the year-end holidays continued to keep the Asian
11:11 Singapore-Japan cargo* AASGN00 486.000 -9.000 LPG market muted, recent sharp climb in prices coupled
Propane Japan cargo (H2 Jan) AAVAK00 470.00–472.00 471.000 -9.000 Propane Japan PMAAX00 55.00/57.00 56.000 +6.000
Propane Japan cargo (H1 Feb) AAVAL00 470.00–472.00 471.000 -9.000
with softer VLGC freight rates to ship a cargo to Japan
Propane Japan cargo (H2 Feb) AAVAM00 469.00–471.00 470.000 -9.000 from Houston has narrowed the price gap between US
Propane Japan cargo* PMAAV00 470.00–472.00 471.000 -9.000
and Asian LPG. If the rise in Asian LPG prices continues to
Propane South China cargo AABAK00 464.00–466.00 465.000 -9.000 Propane South China AABAI00 15.00/17.00 16.000 +10.000
Propane Taiwan cargo AABAN00 465.00–467.00 466.000 -9.000 Propane Taiwan AABAO00 16.00/18.00 17.000 +10.000 outpace that of the US, it will become attractive on paper
Propane North Asia Zone AAJTQ00 467.00–469.00 468.000 -9.000 to ship US LPG cargoes to Japan. The price of propane
Propane Korea PMABK00 52.00/54.00 53.000 +6.000
cargoes for delivery along the Singapore-Japan route
Butane Japan cargo (H2 Jan) AAVAN00 500.00–502.00 501.000 -9.000 Butane Japan PMAAH00 55.00/57.00 56.000 +6.000
Butane Japan cargo (H1 Feb) AAVAO00 500.00–502.00 501.000 -9.000 30-45 days forward, or in H2 January, was assessed down
Butane Japan cargo (H2 Feb) AAVAP00 499.00–501.00 500.000 -9.000 $9/mt day on day at $471/mt in line with softer Brent
Butane Japan cargo* PMAAF00 500.00–502.00 501.000 -9.000
Butane South China cargo AABAU00 494.00–496.00 495.000 -9.000 Butane South China AABAT00 18.00/20.00 19.000 +9.000
crude values. However, the $9/mt decline lagged the
Butane Taiwan cargo AABBH00 495.00–497.00 496.000 -9.000 Butane Taiwan AABBI00 19.00/21.00 20.000 +9.000 more than $15/mt day-on-day drop in front month Brent
Butane North Asia Zone AAJTT00 497.00–499.00 498.000 -9.000 crude values at 5:30 pm Singapore time [0930 GMT].
Butane Korea PMABL00 52.00/54.00 53.000 +6.000
CFR Pressurized Diffs to Saudi CP strip
This is mainly due to physical bids lending support to the
LPG Vietnam AAWUV00 543.00–545.00 544.000 -5.000 LPG Vietnam AAWUW00 107.00/109.00 108.000 +10.000 market. There were two physical offers but no trades. The
LPG Philippines AAWUX00 548.00–550.00 549.000 -5.000 LPG Philippines AAWUY00 112.00/114.00 113.000 +10.000 propane-butane CP swap spread stood at $30 in favor of
FOB Pressurized Diffs to Saudi CP strip
butane and thus butane was also assessed down $9/
LPG East China AAWUZ00 491.00–493.00 492.000 -9.000 LPG East China AAWVA00 55.00/57.00 56.000 +6.000
LPG South China AAWVB00 491.00–493.00 492.000 -9.000 LPG South China AAWVC00 55.00/57.00 56.000 +6.000 mt day on day at $501/mt. The premium for propane for
LPG Singapore AAWVD00 496.00–498.00 497.000 -9.000 LPG Singapore AAWVE00 60.00/62.00 61.000 +6.000 the H2 January cycle was assessed at $56/mt against
*An average of the first two half-month assessments
the prompt-month Saudi Aramco contract price propane
Middle East LPG ($/mt) (PGL page 2776) swap, up from $50/mt a day earlier. The prompt-month
Code Mid Change Code Mid Change CP propane swap was heard to have traded at $415/
FOB Arab Gulf Diffs to Saudi CP mt. Meanwhile, the South Korean government has set its
Propane cargo PMUDM00 404.00–406.00 405.000 -15.000 Propane vs CP PMABF00 -11.00/-9.00 -10.000 0.000
import tax for LPG at 3%, but no tax was imposed this
Propane vs CP M1 (Jan) AAKZA00 -11.00/-9.00 -10.000 0.000
Butane cargo PMUDR00 434.00–436.00 435.000 -15.000 Butane vs CP PMABG00 -11.00/-9.00 -10.000 0.000 year under the flexible tariff quota. However, a 2% tax
Butane vs CP M1 (Jan) AAKZB00 -11.00/-9.00 -10.000 0.000 will be imposed on LPG imports from the first half of next
Propane CP strip (Japan-Korea)* AAKZC00 414.00–416.00 415.000 -15.000
Butane CP strip (Japan-Korea)* AAKZD00 444.00–446.00 445.000 -15.000
year, the country’s finance ministry said Tuesday. The rate
Propane CP strip (China-Taiwan)** AAKZE00 448.00–450.00 449.000 -19.000 will be adjusted again in June for H2 2015 imports. Under
Butane CP strip (China-Taiwan)** AAKZF00 475.00–477.00 476.000 -18.000 the flexible tariff quota, the South Korean government
*loading 20-40 days; **loading 5-15 days
is allowed to temporarily lower tax on selected imported
items, mainly agricultural products and raw materials.
 LPGASWIRE december 23, 2014

European LPG ($/mt) (PGL page 1775) Middle East LPG (PGL page 2799)

Code
Propane Mid Change Code Butane Mid Change
Northwest Europe The Middle East LPG FOB market remained quiet with
FOB Seagoing PMABB00 334.75–335.25 335.000 -9.000 FOB Seagoing PMAAL00 390.75–391.25 391.000 -3.000 little activity heard. Platts had assessed spot FOB Arab
FOB ARA PMAAS00 299.75–300.25 300.000 0.000 FOB ARA PMAAC00 400.75–401.25 401.000 -4.000 Gulf propane cargoes at $405/mt and butane cargoes
FCA ARA* PMABH00 389.75–390.25 390.000 0.000 FCA ARA* PMABI00 404.75–405.25 405.000 -4.000
CIF 1-3k mt PMAAZ00 374.75–375.25 375.000 -9.000 CIF 1-3k mt PMAAJ00 410.75–411.25 411.000 -3.000 at $435/mt.
CIF 7000+ mt PMABA00 373.75–374.25 374.000 -9.000 CIF 3000+ mt PMAAK00 394.75–395.25 395.000 -10.000
FOB 7000+ mt AAVKH00 348.75–349.25 349.000 -9.000 FOB 3000+ mt AAVKI00 349.75–350.25 350.000 -10.000
West Mediterranean LPG (PGL page 1797)
Western Mediterranean
FOB Ex-Refinery/Storage PMABC00 476.75–477.25 477.000 -9.000 FOB Ex-Ref/Storage PMAAM00 516.75–517.25 517.000 -43.000
FCA Ex-Refinery/Storage* PMABJ00 476.75–477.25 477.000 -9.000 The downside pressure on butane in the Mediterranean
CIF 7000+ mt PMABE00 451.75–452.25 452.000 -9.000 continued Tuesday as buying in the region was largely
*FCA ARA refers to sales onto railcars and trucks in the Amsterdam-Rotterdam-Antwerp region covered. During the Platts Market on Close assessment
process, BP offered 4,000 mt for December 28-31
Naphtha ($/mt) LPG Postings ($/mt) loading down to 50% at $521/mt and 50% Platts FOB
Med minus $45/mt pricing December 23-31. Sources
Code Mid Change Saudi Contract Postings (PGL page 2790)
Europe (PGA page 1310 & 1320)
said Morocco was well covered.
Saudi Propane CP (Dec) PTAAM10 550.00
CIF ARA cargo PAAAL00 467.75–468.25 468.000 +0.250 Saudi Butane CP (Dec) PTAAF10 570.00
CIF Med cargo PAAAH00 450.00–450.50 450.250 +1.500 Algerian Postings (PGL page 1790) Northwest Europe Propane (PGL page 1798)
Propane FOB Bethouia CP (Dec) PTAAI10 440.00
Propane FOB Skikda CP (Dec) PTAAJ10 440.00 The narrowed propane-naphtha spread baffled LPG
Month to Date Averages ($/mt) Butane FOB Algeria CP (Dec) PTAAC10 515.00
traders, who failed to see any fundamental reasons
Code Mid Change
for the firmer paper indications. “It’s just technical,”
Northwest Europe Month to Date (PGL page 1775)
Propane FOB Seagoing PMUDI00 382.22–382.72 382.470 -2.970
Propane swaps said one source. Propane traders shrugged off rumors
Propane CIF 7000+ mt PMUDK00 388.81–389.31 389.060 -0.940 Code Mid Change of redirected US cargoes amid healthy North Sea
Middle East Month to Date (PGL page 2776) Northwest Europe ($/mt) (PGL page 1775) supply. “We still have local product,” said a trader,
Propane cargo PMUDO00 444.41–446.41 445.000 -3.000 M1 (Jan) AAHIK00 382.00–386.00 384.000 -9.000 adding that amid high stocks in the North Sea “even
Butane cargo PMUDQ00 470.29–472.29 471.000 -3.000 M2 (Feb) AAHIM00 385.00–389.00 387.000 -1.000 if a cargo doesn’t come, it makes no difference” on
M3 (Mar) AAHIO00 386.00–390.00 388.000
+10.000
the physical market. The strengthening on the paper
LPG Shipping ($/mt) Q1 (Q1 2015) AAHIL00 384.00–388.00 386.000 0.000 market was partly attributed to a perception of a better
Q2 (Q2 2015) AAHIN00 370.00–374.00 372.000 +1.000
supported market in the East, though traders did not
From: To: Product Cargo size Code $/mt US Gulf Coast (¢/gal) (PGA page 780)
see this replicating in Northwest Europe, where demand
(PGL page 1786) M1 (Jan) AAHYX00 56.80–56.90 56.850
+0.475
Norway Netherlands Propane 20kt AAVKK00 25.00 M2 (Feb) AAHYY00 56.90–57.00 56.950
+0.450 remained low. “At these levels, the petchem demand
Norway Netherlands Butane 10kt AAVKJ00 45.00 M3 (Mar) AAHYZ00 57.00–57.10 57.050
+0.450 will also reduce,” said another trader, adding that the
(PGL page 2786) paper strength was likely to be short-lived. “I expect it
Q1 (Q1 2015) PMABS00 56.90–57.00 56.950
+0.450
Persian Gulf Japan LPG 11-44kt AAPNI00 64.00 will go down again,” the source added. Another trader
Q2 (Q2 2015) PMABT00 57.40–57.50 57.450
+0.450
Persian Gulf South China LPG 11-44kt AAPNG00 59.00
Persian Gulf East China LPG 11-44kt AAPNH00 62.00 Saudi CP ($/mt) (PPA page 2652) said that if propane firmed, petchem buyers would turn
Thailand Guangzhou LPG 1-3kt AAPNJ00 146.00 M1 (Jan) AAHHG00 414.98–415.02 415.000
-15.000 to butane instead. On the physical side, Gunvor offered
Thailand Guangxi LPG 1-3kt AAPNK00 144.00 M2 (Feb) AAHHH00 421.98–422.02 422.000
-19.000
two TOT cargoes, January 15-20 and January 20-25,
Thailand Shantou LPG 1-3kt AAPNL00 147.00 M3 (Mar) AAHHI00 423.98–424.02 424.000
-20.000
Japan Shanghai LPG 1-3kt AAPNM00 96.00 both at $388/mt and January swaps flat. Gunvor was
Korea Shanghai LPG 1-3kt AAPNN00 81.00 Q1 (Q1 2015) AAHHJ00 419.98–420.02 420.000
-18.000 also prepared to buy the same cargoes at naphtha

Copyright © 2014, McGraw Hill Financial 2

 LPGASWIRE december 23, 2014

US LPG (PGA page 780) minus $130/mt. Vilma was also a bidder for January
Code Mid
Change Code Mid
Change 8-12 cargo at $345/mt. According to traders, physical
cargoes were pricing below the paper values amid thin
Mont Belvieu non-LST (¢/gal) Mont Belvieu LST (¢/gal)
Ethane/propane mix M1 PMUDA05 17.95–18.05 18.000 0.000 demand. Similarly, lackluster activity continued to define
Ethane/propane mix M2 AAWUB00 18.08–18.18 18.125 -0.250 the coaster market, with mild temperatures weighing
Ethane purity M1 PMUDB05 18.70–18.80 18.750 +0.875 on demand. Barges were also under pressure, with
Ethane purity M2 AAWUC00 18.83–18.93 18.875 +0.625
Propane M1 PMAAY00 55.20–55.30 55.250 +0.375 Propane M1 PMABQ00 56.70–56.80 56.750 +1.000
refineries keen to place product and prices seen carrying
Propane M2 AAWUD00 56.58–56.68 56.625 +0.625 Propane M2 AAWUE00 57.20–57.30 57.250 +0.750 a significant discount versus the large cargoes. No
Normal butane M1 PMAAI00 71.95–72.05 72.000 +1.250 Normal butane PMABR00 67.95–68.05 68.000 +1.250 indications were heard on the FCA market, with no fresh
Normal butane M2 AAWUF00 74.33–74.43 74.375 +1.625
material changing hands amid huge delays for truck
Isobutane PMAAB00 71.95–72.05 72.000 +1.000 Isobutane AAIVD00 71.95–72.05 72.000 +1.000
Natural gasoline (non-Targa) M1 PMABY05 108.95–109.05 109.000 +2.750 Natural gasoline AAIVF00 112.45–112.55 112.500 +2.750
loadings reported in the Antwerp area and also some
Natural gasoline (non-Targa) M2 AAWUG00 112.70–112.80 112.750 +3.500 unconfirmed refinery issues. “We have to wait five to
Natural gasoline (Targa) PMABW05 108.45–108.55 108.500 +2.750 eight hours to get product -- we are not going to buy any
($/mt) more,” said a source.
Propane AAXDD00 287.85–287.87 287.855 +1.955
Normal butane AAXDC00 326.15–326.17 326.160 +5.660
Northwest Europe Butane (PGL page 1799)
Conway, Kansas (¢/gal) Bushton, Kansas (¢/gal)
Ethane/propane mix PMAAO00 19.70–19.80 19.750 +1.000
Butane buying for early January has largely been covered
Propane PMAAT00 51.95–52.05 52.000 +0.500 Propane AALBE00 51.95–52.05 52.000 +0.500
Normal butane PMAAD00 81.95–82.05 82.000 -0.250 on the large cargo segment, with market players seeing
Isobutane PMAAA00 81.70–81.80 81.750 -0.500 levels around 84% versus naphtha. Equally, activity was
Natural gasoline PMAAQ00 109.70–109.80 109.750 +0.500 thin on the barge market, said traders. The market was
The River* (¢/gal) Hattiesburg pipeline (¢/gal) perceived as long with little demand. Petrochemical
Natural gasoline AALBG00 114.95–115.05 115.000 +2.750 Propane AALBC00 53.70–53.80 53.750 +0.375 demand was soft, whereas blending demand was
Note: Spot prices exclude terminalling; *The River means on barges in various points of Mississippi River in Louisiana.
sporadic. “Blenders are covered and some buyers are
Waterborne FOB Houston ($/mt) Waterborne FOB Houston (¢/gal) covering with their own volumes,” said one trader. Some
Propane AAXIM00 315.87–315.89 315.880 +8.960 Propane AAXIN00 60.62–60.64 60.630 +1.720
activity was heard once again on the coaster market,
Propane vs. Mt Belvieu AAXIO00 20.05–20.07 20.060 +5.210 vs. Mt Belvieu AAXIP00 3.80–3.90 3.850 +1.000
although details were scarce. Values for CIF volumes
VLGC Freight Rates ($/mt) VLGC Freight Rates (¢/gal)
Houston to NWE AAXIQ00 65.00 Houston to NWE AAXIR00 12.48
Houston to Japan AAXIS00 170.00 Houston to Japan AAXIT00 32.63 NYMEX Futures
Platts Futures Assessments 3:15 pm ET* (PGA page 703)
$/barrel
Light sweet crude (Feb) NYCRM01 57.27
LPGASWIRE Volume 36 / Issue 252 / December 23, 2014 Light sweet crude (Mar) NYCRM02 57.62
Light sweet crude (Apr) NYCRM03 58.01

Editorial: Esa Ramasamy, Editorial Director, Americas Oil: +1-713-658-3292, Matt Cook, Senior Managing Editor, Americas Clean Products +1-713-658-3208 Futures Settlement (PGA page 702)
Client services information: North America: +1 800-PLATTS8 (+1-800-752-8878); direct: +1-212-904-3070 Europe & Middle East: +44-20-7176-6111 $/MMBtu
Asian Pacific: +65-6530-6430 Latin America: +54-11-4121-4810, E-mail: support@platts.com Natural gas (Jan) AACMZ00 3.17
Copyright © 2014 McGraw Hill Financial. All rights reserved. No portion of this publication may be photocopied, reproduced, retransmitted, put into a computer system $/barrel
or otherwise redistributed without prior written authorization from Platts. Platts is a trademark of McGraw Hill Financial. Information has been obtained from sources Light sweet crude (Mar) AASCS00 56.46
believed reliable. However, because of the possibility of human or mechanical error by sources, McGraw Hill Financial or others, McGraw Hill Financial does not
guarantee the accuracy, adequacy or completeness of any such information and is not responsible for any errors or omissions or for results obtained from use of such * These assessments reflect prevailing futures value exactly at 3:15 pm ET.
information. See back of publication invoice for complete terms and conditions. However, on the business day preceding the following holidays these assess-
ments reflect the value of futures at precisely 1:30 pm ET: Christmas Day, New
Years Day, Fourth of July, and Thanksgiving Day.

Copyright © 2014, McGraw Hill Financial 3


were heard in a wide range depending on quality. There
were refinery tons available both in ARA and the UK,
according to sources. FOB availability was not that
plentiful, but demand was also weak. “I haven’t seen
any demand, but there is little available,” said a source.
With the Med weakening further, it was also not seen
providing an outlet for NWE FOB barrels.
US Gulf Coast (PGA page 799)
US Gulf Coast natural gas liquids turned bullish
following higher oil futures that rallied on US GDP growth
showing the highest rate in 11 years. NYMEX February
crude settled $1.86 cents higher at $57.12/barrel.
Front-month ICE Brent ended the session up $1.58 at
$61.69/b. Non-Targa natural gasoline jumped 2.75
cents to $1.09/gal based on three deals done at that
level. Vitol sold to Trafigura, while George E. Warren and
Glencore bought from ATMI, each trading 25,000 barrels.
Despite the three trades, overall liquidity has been thin,
dampening the bullish trend that did not keep up with
the front-month NYMEX light sweet futures. At $1.09/
gal, natural gasoline’s value equated to 79.94% of the
Platts assessment for NYMEX February crude at 3:15
pm EST (2015 GMT), compared with 80.84% on Monday.
The January barrels were assessed at $1.1275/gal, up
3.5 cents, since the contango between December and
January widened to 3.75 cents. One reason December
barrels are weaker than January barrels is that companies
have to pay taxes on their end-of-year inventories. As a
result, there is an incentive to liquidate inventory, which
puts a cap on prices. In addition, at this time of year,
the number of buyers shrinks due to the tax regime.
Non-LST propane moved up 37.5 points at 55.25 cents/
gal. The move in propane value was weakened due to
lower seasonal heating demand as most of US continue
show mild weather forecast. Roughly 30% of US propane
is used for heating, according to Bank of America Merrill
Lynch Global Commodity Research. Non-LST butane was
assessed at 72.00 cents/gal, up 1.25 cents.
LPGASWIRE
News (PGA page 100)
China’s November net LPG imports up
17% on month, more than triple on year
China’s net LPG imports continued to climb by around
17% month on month to 625,857 mt in November, with
imports at 741,645 mt and exports at 115,787 mt, data
from the General Administration of Customs showed
Tuesday. November net imports also surged around
231% from 189,091 mt in the same month last year.
China imported 497,649 mt of propane in November
and exported 46,767 mt, putting net propane imports at
450,882 mt, down slightly from 452,934 mt in October.
However, November butane imports totaled 243,995
mt and exports were at 69,020 mt. Net butane imports
of 174,975 mt more than doubled from 80,976 mt in
October. More butane was imported into the country
as the price of butane, which normally higher than that
of propane was lower instead last month, domestic
market sources said. The pre-tax import cost of butane
averaged $694/mt in November, about $28/mt lower
compared with the average import value of $722/mt for
propane last month, the data showed. Meanwhile, the
pre-tax import cost of LPG cargoes (propane and butane
ratio of 50:50) averaged $713/mt in November, down
by $107/mt or around 13% from $820/mt in October.
The November import value equates to around Yuan
4,983/mt ($813.82/mt) after adding customs duty and
VAT, according to Platts calculations. Meanwhile, spot
imported LPG cargoes traded at an average of Yuan
4,956/mt and Yuan 5,106/mt in South China and East
China, respectively, in November, implying slight losses
for import terminals in the south, but marginal profits for
terminals in the east, the same situation as the previous
month, according to Platts weekly LPG monitoring data
and calculations. China’s net LPG imports over January-
November totaled 4.97 million mt, up 130% from 2.17
million mt in the same period last year, the customs
data showed. Net propane imports totaled 3.77 million
Copyright © 2014, McGraw Hill Financial
december 23, 2014
mt over January-November, up 159% year on year, and
net butane imports of 1.20 million mt were up 69%.
The pre-tax import cost of LPG cargoes averaged $870/
mt in the first 11 months of the year, down for the
first time this year by around 1% from $878/mt in the
same period of 2013, due to continued slumps in Saudi
Aramco’s Contract Prices and Asian spot prices over
the past months. The UAE remained top supplier of LPG
to China in November and in the first 11 months of the
year at 340,245 mt and 3.40 million mt, respectively.
Market sources said the figures likely included volumes
from Iran as some Chinese buyers have signed LPG
term contracts with Iranian companies for delivery in
2014, but no Iranian cargoes were recorded by China’s
customs, according to its data. Kuwait overtook the
US to become the second-largest supplier to China at
111,690 mt in November, but the US remained the
second largest supplier of LPG to China in the first 11
months of the year at 686,471 mt. Nigeria was the third
largest supplier to China at 104,616 mt in November,
while Kuwait was the third-largest supplier to China in the
first 11 months of the year at 614,210 mt. For exports,
the Philippines, Hong Kong and Vietnam continued to be
the top three buyers of China’s LPG in November and the
first 11 months of the year.
Houston Ship Channel reopens to all
traffic: US Coast Guard
The Houston Ship Channel reopened Tuesday after being
closed for more than 10 hours due to foggy conditions.
The ship channel closed at 12:35 am CST (6:35 am
GMT). According to the US Coast Guard, Houston Pilots
began reboarding inbound vessels at 10 am and traffic
began to flow both ways at 11 am. A Houston Pilots
dispatcher said about 50 vessels were affected by the
waterway’s closure. “There were about 30 inbound and
15 to 20 outbound,” he said. The heavy fog also shut
the Galveston/Texas City Ship Channel. It closed at
1:13 am and reopened at noon.
4

ONEOK starting new Mont Belvieu,
Texas, fractionator: spokeswoman
ONEOK Partners is in the process of commissioning and
startup of its new MB-3 fractionation train at its Mont
Belvieu, Texas, facility, a spokeswoman said Tuesday.
“MB-3 is now complete and is designated for 75,000
b/d of natural gas liquids,” spokeswoman Stephanie
Higgins said in an email. “We have not announced an
in-service date as it’s a process to get the facility up and
running,” she said. “We will announce that information
once it’s completely in service.” Higgins said 80% of
the available 75,000 b/d capacity on MB-3 has already
been committed. On Monday, the Texas Commission
on Environmental Quality said initial commissioning and
startup of an NGL fractionation train at Mont Belvieu
had begun, though it did not mention ONEOK as the
owner. ONEOK currently has 235,000 b/d of fractionation
capacity at Mont Belvieu. Once MB-3 is in service, total
capacity will reach up to 310,000 b/d. ONEOK also
completed a 40,000 b/d ethane/propane splitter at
Mont Belvieu earlier this year, ONEOK said in its first-
quarter 2014 earnings call. In addition, ONEOK plans
to build the MB-4 fractionation train with 75,000 b/d
capacity at Mont Belvieu. The company received a US
Environmental Protection Agency permit on June 20,
though the completion date for the MB-4 train has yet
to be announced. Higgins said the MB-3 project will cost
between $375 million and $415 million. ONEOK has
100% ownership. Mont Belvieu currently has 1.628 million
b/d of fractionation capacity among Enterprise Products
LPGASWIRE
Partners, ONEOK, Lone Star NGL, Targa Resources and
Gulf Coast Fractionators. ONEOK’s MB-3 will increase the
total capacity for Mont Belvieu to 1.7 million b/d.
NWE propane discount to naphtha hits
narrowest level since January
The discount of the CIF NWE propane cargo swap to
the equivalent naphtha cargo swap Monday reached
its narrowest level in 10 months as the propane paper
market strengthened while the Northwest European
naphtha market remained stable, trading sources said.
The front-month propane to naphtha discount -- which
is also viewed as a relative measure of the viability
of propane as an alternative steam cracker feedstock
versus the more traditional throughput -- was assessed
at $74.50/mt Monday versus $86.75/mt Friday. The
last time it was narrower was January 31, at $58.50/
mt. The narrowed propane-naphtha spread baffled LPG
traders, who failed to see any fundamental reasons for
the firmer paper indications. “It’s just technical,” said
one source. Propane traders shrugged off rumors of
redirected US cargoes amid healthy North Sea supply.
“We still have local product,” said a trader, adding that
amid high stocks in the North Sea “even if a cargo
doesn’t come, it makes no difference” to the physical
market. The strengthening paper market was partly
attributed to a perception of a a better supported East
market, though traders did not see this replicating in
Northwest Europe, where demand remains low. “At
these levels, the petchem demand will also reduce,”
Copyright © 2014, McGraw Hill Financial
december 23, 2014
Subscriber notes (PGA page 1500)
As a reminder, Platts will not publish any US crude
oil or refined products price assessments on Thursday,
December 25, or Friday, December 26, due to the
US Christmas holiday. Additionally, on Wednesday,
December 24, the Platts Market on Close assessment
process will close at 12:30 pm CST (1:30 pm EST, 1830
GMT). The deadline for submission of bids and offers
for the MOC process is as follows: barges and pipeline
markets -- 12:00 pm CST, cargo markets -- 11:45 am
CST, and swaps -- 12:15 pm CST. For a full list of
publications and services affected by the Christmas
holiday, please see the Platts holiday calendar at www.
platts.com/holiday. Please send questions or comments
to americas_products@platts.com.
another trader said, adding that the paper strength is
likely to be short-lived. “I expect it will go down again.”
However, an end-user said petrochemical end-users
could continue to maximize propane as the physical
price of North Sea propane cargoes [assessed at $383/
mt Monday] only represents 82% of the physical price
of CIF NWE naphtha cargoes [assessed at $467.75/mt
Monday]. “Theoretically it still makes sense to crack a
max of propane as it is still low enough,” the end-user
said. Meanwhile, the European naphtha market was
steady this week amid thin trading activity and balanced
supply, while more physical length was expected next
month due in particular to weak sentiment in Asia and
a slight increase expected in exports from the Russian
Baltics ports, according to trading sources.
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