News
31/12/24
Viewpoint: Canadian propane exports poised to rise
Calgary, 31 December (Argus) — Canadian propane exports to Asia are expected to
continue growing in 2025, driven by increased export capacity and natural gas
liquids (NGL) production, as producers ramp up drilling to meet rising demand
ahead of the LNG Canada export facility start up. Propane and butane exports
from Canada to Asia average about 153,000 b/d in the third quarter of 2024.
AltaGas exported 128,272 b/d of propane and butane to Asia during the quarter,
with about 50,000 b/d leaving its Ferndale, Washington, terminal and 70,000 b/d
from the Ridley Island Propane Export Terminal (RIPET) in British Columbia (BC).
Additional exports came from Pembina's 25,000 b/d propane export terminal at
Watson Island near Prince Rupert, BC. Midstream operators are investing in an
additional 70,000 b/d of propane and butane export capacity in the next few
years. AltaGas is advancing the construction of its Ridley Island Energy Export
Facility (REEF) adjacent to RIPET, which will have an export capacity of 55,000
b/d in its first stage, potentially operational by 2028. Pembina is also
considering a 15,000 b/d expansion of its propane export terminal, but a final
investment decision (FID) has not yet been made. Another potential increase in
export capacity could come if Trigon Terminals repurposes its 18mn t/yr coal
export terminal on Ridley Island for NGL exports. There has been no FID on this
project, and the company is in litigation with the Prince Rupert Port Authority
(PRPA) over export rights. If approved, the project could be operational by
2028, according to the company. The growth in export capacity is driven by
rising natural gas production, stemming from expectations of increased LNG
exports from Canada. The 14mn t/yr LNG Canada export terminal began
commissioning in late August and is expected to start shipping LNG cargoes by
mid-2025. Located in Kitimat, BC, it is only 120km from the country's Pacific
coast LPG export hub near Prince Rupert. Another LNG facility under construction
is the 2.1mn t/yr Woodfibre LNG export terminal near Squamish, BC, north of
Vancouver. This joint venture between Canadian midstream operator Enbridge and
Singapore-based Pacific Energy is expected to be completed in 2027.
Additionally, the Indigenous Haisla Nation and Pembina Pipeline reached a final
investment decision for their 3.3mn t/yr Cedar LNG floating facility in Kitimat,
which is set to open in late 2028. Fractionation capacity also grows The
increase in natural gas production will result in higher NGL output, with about
90pc of Canada's NGL production coming from natural gas. This has driven
increased demand for fractionation services in western Canada. Keyera plans to
debottleneck its second fractionation unit at Keyera Fort Saskatchewan (KFS) in
Alberta, adding 8,000 b/d of capacity to the existing 66,000 b/d. Keyera expects
to make a final decision early next year, with potential completion by late
2026. The company has also secured customer backing to build a third KFS
fractionator, which it hopes to commission in 2028. Pembina continues to advance
its 55,000 b/d Redwater IV fractionation facility at its Redwater complex (RFS)
in Alberta, which is expected to be online in the first half of 2026. Currently,
RFS has three fractionators with a total capacity of 210,000 b/d. Calgary-based
Wolf Midstream reached an FID in July to build phase two of its NGL North
complex, which will include a 90,000 b/d fractionation facility, including
60,000 b/d of ethane capacity. Canadian propane exports increased to 64.9mn bl
in January-October, compared with 58.7mn bl during the same period in 2023. By
Yulia Golub Send comments and request more information at
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