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MarkWest Energy Partners, L.P. Message Board

  • intarzletrol intarzletrol May 8, 2014 12:14 PM Flag

    RBN Part II on Ethane and NGL exports:

    This blog has continued their excellent series on ethane exports. Highlights: EPD's terminal and contracts with by shippers for new refrigerator ships. Antero 1st to sign up with Mariner East II. Ineos has upped their ship building contract with a Dutch company for six ships and has signed a contract with EPD. So they are eyeing not only Marcus Hook but the Gulf for ethane for the European markets.

    So it looks like things will get done but on a deal by deal basis. A little more reality to the markets.

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    • What's reality is that with the EPD export terminal having an initial capacity of 240,000 barrels/day of ethane any European cracker using naptha as a feedstock is either dead or dependent on govt subsidies to survive.A cracker takes like 50,000 barrels/day of ethane. Now, what we need to know is just how much ethane is going to go on Mariner East 1 and Mariner East II. Mariner East I has been touted as 70,000 barrels/day of either propane or ethane. It will start with the more valuable propane later this year until the refrigeration facilities required for ethane are available. At Marcus Hook. But let's say that next year the split between ethane and propane is 50/50 or 35,000 barrels/day of ethane. I have yet to see a capacity figure on Mariner East II or whether it will be built...but I am assuming it will be built and that it will be a 12" pipe instead of the 8" pipe in service now. If so, the capacity of Mariner East II would be like 160,000 barrels/day. Assuming that all Mariner East II is ethane we will in late 2016 have 435,000 barrels/day of ethane export capacity available from the USA. This is like 8 crackers worth somewhere. I think it really understandable that Ineos is getting lots of ethane carriers built..with crackers in Norway and Grangemouth,Scotland, Ineos will be in great shape compared to it's competitors. And you have to give EPD a lot of credit. It pioneered propane exports and here it goes again with a massive ethane export project.

      • 2 Replies to ake05bono
      • I have seen reports on the potential for ethane from the Marcellus/Utica at 800k barrels by 2020. The lesson I am taking out of this is that all these deals are going to unfold on a piecemeal basis. Right now I want to see the Utica shakeout. It has been a big surprise that the northern part of the NGL is not panning out as expected. Last year the oil sector disappeared and now the LIquid acreage is shrinking. CHK says they are going to start to push their dry Utica. Do they have any choice? I have never seen a company be first on the ground and not able to secure the best acreage. In the meantime by blind luck they bought up all kinds of great Eagle Ford acreage.

      • ake05 - a concern is whether there will be enough ships to carry the 435,000 barrels/day of ethane. It takes a couple of years to get ships, and I think Navigator said they were unaware of any new orders, and that yard capacity is booked. I'm not complaining, but if all that ethane is coming on line, there needs to be a way to get it to Europe and Asia.

        I'm pretty sure Navigator indicated everything you suggest will indeed occur, but it take more time than people have patience.

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