Why rising propane and butane exports affect some US energy MLPs (Part 1 of 5)
Propane and butane
Propane and butane are hydrocarbons that can be used as fuel and for other applications, such as to produce some chemicals and polymers. Over the past few years, the U.S. has been exporting an increasing amount of liquefied petroleum gases or LPGs, which is a term used for propane and butane, and the company has U.S. become a net exporter of LPGs for the first time.
In this series, we’ll discuss what factors are driving increased LPG exports. Plus, we’ll discuss the plans of Targa Resources (NGLS) and Enterprise Products (EPD) to increase LPG export capacity (both part of the Alerian MLP ETF, AMLP), how exports could support NGL prices and benefit upstream companies such as those found in the S&P SPDR Oil and Gas Exploration and Production ETF (XOP), and how higher LPG prices might affect propane distributors such as AmeriGas (APU).
Browse this series on Market Realist: