EIA: Gulf Coast’s first ethane shipment soon to leave for Europe

JS Ineos intrepid prepares to load first ethane cargo at Morgan’s Point export terminal, located on the Houston Ship Channel. Photo courtesy of the EIA.

 

The first ethane shipment out of Enterprise Products Partners’ (EPP) new export terminal in Morgan’s Point, Texas, is preparing to set sail for Norway. As of Thursday morning, the JS INEOS Intrepid was docked at the terminal, preparing to take on its ethane cargo. The terminal, located on the Houston Ship Channel, is the second to open in the United States, and has an export capacity of up to 200 Mboed of liquefied ethane, of which about 90% is contracted. The United States’ first ethane export terminal, at Marcus Hook, Pennsylvania, has been shipping ethane cargoes since March of this year.

Ethane can either be extracted along with other natural gas plant liquids and sold separately, or left in the processed gas and sold as part of the natural gas stream. Recent rapid growth in natural gas production from resources rich in natural gas plant liquids has yielded higher quantities of ethane than the US market can absorb, leading to growing amounts of ethane left in the processed gas stream. Increased ethane exports could slow or reverse this trend.

Natural gas produced in the Marcellus and Utica formations, located primarily in Pennsylvania and Ohio, respectively, tends to be rich in ethane. The Marcus Hook terminal sources all of its ethane from these formations. Some of this Appalachian ethane likely will be delivered to Morgan’s Point via EPP’s Appalachia-to-Texas Express (ATEX) pipeline, which moves ethane from gas fractionation plants in the Marcellus and Utica to the company’s storage complex in Mont Belvieu, Texas.

Ethane cargoes from the United States are used as feedstock in European ethylene crackers. Shipments currently go to the cracker in Rafnes, Norway, which is run by the petrochemical manufacturer INEOS. A cracker at Stenungsund in Sweden, owned by Borealis, is expected to begin receiving ethane from Marcus Hook later this year, while another INEOS cracker in Grangemouth, Scotland, is scheduled to come online in the fall and will receive ethane deliveries primarily from Morgan’s Point.

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