Keeping America Great -- EPD To Expand Export Capacity In The Channel -- July 8, 2019

From S&P Global, Platts:

• EPD will expand its ability to export crude, LPG, and polymer grade propylene
• will expand the Enterprise Hydrocarbon Terminal, Houston Ship Channel
• to build an eighth dock at that facility
• will accommodate a Suezmax tanker, the largest ship able to navigate the Ship Channel
• will add 840,000 bopd; will bring capacity to 2.75 million bopd
• expansions to load an incremental 1.3 million b/d of LPG, propylene, and LPG
• in service by 4Q20
• EPD estimates US crude oil exports to hit 8 million bopd by 2025
• April, 2019: the US Gulf Coast exported 2.6 million bopd (EIA)
• EPD expects the US LPG export market to double from 1.4 million BPD to 2.8 million BPD by 2025
• April, 2019: Gulf Coast exported 1.3 million BPD of LPG; total US LPG exports, 1.7 million b/d

Much more at the link.

By the way, the eight-year court case between EPD and Energy Transfer is going to the Texas Supreme Court, link at SeekingAlpha (this link may break over time). Archived here.

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LNG Feedgas Demand Hits Record Highs

From twitter:

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US NG Injections At Record Pace 

Injections: exceeding five-year average by 41%

Posted earlier today by the EIA, from twitter:

Propane And Butane -- LPG -- Bakken 101 -- June 22, 2017

I track the US LPG export story here. This is truly an incredible story. I remember posting stories about the "great propane shortage" some years ago which was a huge problem for North Dakota farmers who were at risk of losing their crop because they could not dry what they had harvested. That was back in 2013 - 2014, and it was such a big story, it got its own tag. In less than five years, an incredible difference, all due to the Bakken.

From today's RBN post:

Propane and butane — the two natural gas liquids (NGL) products generally referenced as LPG — are produced by the processing of natural gas yielding mixed NGLs and the fractionation of those NGLs into purity products.

Refineries also produce LPG.

U.S. production of propane and butane has skyrocketed during the Shale Era, largely because of rising production of wet natural gas, which contains significant volumes of NGLs.

As result, the U.S. five years ago flipped from its long-time status as a net LPG importer to a net exporter.

By 2016, net U.S. exports had risen to an average of 855 Mb/d, more than 15 times the exporting pace in 2012, and in the first six months of this year, LPG exports averaged just above 1.0 MMb/d.

Where is all this LPG headed?

A lot of it is headed for Asia. In 2016, Asian markets were the destination for 372 Mb/d (or 44%) of the 855 Mb/d exported from the U.S., and so far in 2017 Asia’s share has risen to 50%; Latin America (excluding Caribbean) is second (22% of total exports in 2017 year-to-date), Europe is third (14%), and exports to the Caribbean (receiving 9% of the U.S. exports) account for most of the rest.

The flourishing Gulf Coast-to-Asia LPG trade — 484 Mb/d (51%) of the approximately 950 Mb/d of the propane/butane exported from Texas terminals so far this year went to Asia — was made possible in part by the perfectly timed expansion of the Panama Canal, which with its new, more commodious locks, can now accommodate each and every one of the world’s more than 200 Very Large Gas Carriers (VLGCs), which can carry up to 550 Mbbl of LPG and which because of their size and economies of scale are the LPG-movers of choice, especially for serving mega-markets like Japan. Before the expanded canal opened in June 2016, four-fifths of the world’s VLGCs were too big to squeeze through.

By the way, just like The New York Times hoax story on the US natural gas revolution, The New York Times was convinced that the Panama Canal expansion would fail. By the way, my posts on The New York hoax story was one of the top stories I ever posted, based on number of hits and google searches. Whatever.

But what about LPG exports and the Panama Canal?

But transiting the Panama Canal doesn’t come cheap — tolls, tug fees and other charges can top $200,000 per VLGC, and that's just for the one-way trip from Houston to Asia — and it takes about 25 days to make that journey, and time is money.

Which brings us to Petrogas’s Ferndale, WA, export terminal, which thanks to its West Coast location can reach Japanese and other Asian ports in 10 to 12 days — less than half the time it takes to sail from Texas ports, through the canal and across the Pacific.

For most of its 41-year history, Ferndale — located in the northwestern corner of Washington State, an hour’s drive south of Vancouver, BC — was a minor player in the NGL universe, handling small volumes of seasonal refinery butane storage and occasional exports of butane to Latin America and Asia.

Interest in Ferndale grew, though, as U.S. and western Canadian NGL production increased, as the U.S. flipped from being a net LPG importer to a net exporter, and — for Alberta producers in particular — when a portion of Kinder Morgan’s Cochin Pipeline (which moved up to 95 Mb/d of propane and other NGLs southeast from Fort Saskatchewan, AB, to the U.S. Midwest and Ontario) was repurposed to move diluent northwest from Illinois to the oil sands (for blending with bitumen to make dilbit, a diluent/bitumen combo that can flow through pipelines). Without Cochin, western Canadian propane and butane has to be transported by rail or truck into the Midwest or Northeast and, with U.S. NGL production rising fast, it made more and more sense for LPG producers and marketers to pursue export opportunities.

Much, much more at the linked RBN story. Archived.

The California LPG Story -- The Energy And Market Page, T+68 -- March 30, 2017

Disclaimer:  this is not an investment site. Do not make any investment, financial, job, travel, or relationship decisions based on anything you read here or think you may have read here.

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Enbridge

Enbridge. Enbridge buys Spectra, strengthens hold in North America. From Zacks.

The $126 billion merger brings together Enbridge’s liquid-weighted midstream assets from Western Canada and the U.S Midwest and Spectra's network of primarily gas-related midstream assets.

The assets include Spectra’s holdings in the U.S. North, Midwest and Gulf Coast and the British Columbia’s Canadian province. We note that a total of 1,000 jobs were cut by the merged company.

The merged company has $74 billion in secure projects and inventory. By 2019, the company is expected to start up $26 billion worth projects. Enbridge believes that the company will yield a 3–5% compound annual growth rate with the inclusion of Spectra’s projects.

The company is also expanding its platform for renewable power generation.

Comment: this has become a personal favorite of mine. Enbridge was one of the first companies that caught my interest when I started following the Bakken. I noticed early on (July 23, 2010) that this company was involved in intermittent energy in Canada; it was one of the first links at the sidebar at the right. That told me the company was able to ace an open-book test. And there it is again, the last sentence in the segment above -- "expanding its platform for renewable power generation."

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Other

DUCs. Huge 300,000 bopd fracklog could derail oil policy recovery. From Oilprice.com. Old story. I don't buy it. Many reasons. Previously discussed.

Mexico. From Reuters, data points:

• Italy's Eni
• major gas finds in Mozambique and Egypt; holds one of the best discovery track records in the industry
• Eni's gas discovery off Egypt was the biggest gas field every found in the Mediterranean
• organic reserve replacement ration:
• industry average: 35%
• ENI: 193%
• first international company to drill off coast of Mexico after 2013 reform opening up Mexico to foreign investors
• recent oil discovery in Mexican GOF: original estimate -- more than 800 million bbls of light oil
• now says the field will hold more than original estimate -- number not given
• Shell, Chevron, Exxon Mobil all interested in returning to Mexico's deep waters

Permian. Swaps. From Bloomberg, data points:

• drillers drilling longer horizontals -- 2-mile horizontals
• slivers of land owned by another operator create issues; solution: swaps
• acreage can run as high as $60,000 / acre in the Permian; swaps -- almost no cost
• the slivers of land would probably not be wide enough for second company to drill
• swaps: win-win for both companies
• reminder: Double Eagle selling 71,000 Permian acres to Parsley for $2.8 billion (previously reported; $40,000 / acre)
• SM Energy: "doubling the lateral length, combined with other techniques, can make a well about four and a half times more valuable 
• SM Energy: last year bought 35,700 acres in the Permian from QStar LLC

California. California's production of propane and butane continues to decrease; the decrease in production is offset by an increase in rail shipments. This is an interesting story for the archives with regard to many, many story lines. EIA data points:

• many, many story lines including CBR; the state's fossil fuel regulatory environment
• total US production of propane and butanes (liquified petroleum gases - LPG) increases to over 2 million bopd
• increased in all regions of the country except for the West Coast
• unlike other regions, West Coast LPG production has been decreasing since 2010, driven by declining refinery production
• production in the region totaled 80,000 bopd in 2016, 10,000 less than in 2010
• as a result, rail shipments have become a growing means of transporting LPG to the region
• the amount of LPG production in the US has surged (except along the West Coast)
• West Coast import/export data: the increased ability to transport LPG by rail has allowed Western Canadian producers, who can no longer ship LPG by pipeline to the Midwest following the repurposing and reversal of a key pipeline, to ship more LPG to the West Coast, where it can then be exported to overseas markets
• the West Coast has only one major LPG export terminal; it accounts for nearly all overseas LPG exports
• as LPG exports continue to increase, two other terminals on the West Coast have been proposed, but the permitting phase of development is not finished yet

US Propane Exports -- One Of The Top US Energy Stories Of The Decade -- July 3, 2016

Flashback: I don't know if folks recall, but during the winter of 2013 - 2014, the US was experiencing a severe propane shortage.

Fast forward to summer of 2016: US propane exports are expected -- by the end of this year -- to exceed those of Qatar, Saudi Arabia, Algeria and Nigeria combined.

Back on  April 29, 2016, RBN Energy provided an incredible update of the US propane story -- this is a huge turnaround story in less than three years -- and very few Americans are even aware of it. For me, it has not sunk in, and I follow energy pretty closely (at least superficially). Look at some of the data points:

• US domestic production of NGLs (like propane and butane is soaring
• US liquified propane gas (LPG) exports in the past three years have rocketed to the top
• US exports of LPG now surpasses exports by the old Big Three: UAE, Qatar ("cutter"), and Algeria
• the rise in LPG exports may be ending
• exports from the Gulf coast may be in for a decline
• more propane and butane from the Marcellus and Utica will be re-routed to Marcus Hook, PA
• demand for new propane dehydrogenation plans and flexible steam crackers will be climbing

And this has only just begun. Remember, this turnaround story occurred before the expansion of the Panama Canal. It was just late last month that the first propane-laden "New Panamax" vessel that transited the canal:

RBN Energy: a propane-laden VLGC inaugurates the expanded Panama Canal.

After the $5 billion-plus expansion of the Panama Canal is dedicated this Sunday, June 26, the first “New Panamax” vessel scheduled to pass through the canal’s new, longer, wider locks will be the Lycaste Peace, a Very Large Gas Carrier (VLGC) that is transporting propane from Enterprise Products Partners’ Houston Ship Channel export terminal to Tokyo Bay in Japan.

What remains to be seen, though, is how many other supersized vessels carrying propane, liquefied natural gas (LNG) or other hydrocarbons will follow, and how soon. Today, we mark the formal opening of the newly enlarged Atlantic-Pacific short-cut with a look both at the game-changing potential of the expanded canal and the realities of today’s energy and shipping markets.

For more on how US ports are prepared for the Panama Canal expansion, see this post.

How Big A Deal Is The Expanded Panama Canal For The US? Huge -- June 27, 2017

How big a deal is the "new and improved" Panama Canal for the US? Huge.  

By 2018 US exports of LPG will likely equal those of Qatar and the United Arab Emirates combined.

See the update the original post.

China is already the biggest single customer for US propane and second-biggest for LPG and the ability to move these volumes more efficiently will likely only increase that flow. 

EIA data show trade to both China and Japan having already accelerated before the canal expansion’s opening. LPG shipments to Japan more than tripled to 166,000 b/d in the first 3 months of 2016 from 49,000 b/d for the same period last year. Shipments to China jumped to 161,000 b/d from 66,000 b/d in the same window.

December 31, 2018, is less than 3 years from now; the second full year of Hillary's presidency. Things are moving very, very quickly.

As a reminder, the difference between propane and LPG:

Propane is a byproduct of natural gas processing and petroleum refining. Before propane is used, it exists in one of two forms, liquid or gas (or vapor). Both liquid propane and gas are usable but cannot be used interchangeably. In other words, a propane system designed to use gas can’t utilize propane in its liquid form and vice-versa. Additionally, the characteristics of propane liquid and propane gas are so different that the primary properties we are concerned with are as different as night and day. With propane liquid, temperature is the primary factor whereas weight is the main concern regarding propane vapor. Think of it this way, water is liquid and steam is water vapor. The same holds true for propane and is explained in detail below.

Also:

Propane is classified as LPG, along with butane, isobutane and mixtures of these gases. 

This looks like a pretty good source for sorting this out. 

The Brexit? It's only "make-believe."

It's Only Make Believe, Conway Twitty

Data Points From RBN Energy's Update On US LPG Exports -- April 29, 2016

In a long note like this, there will be typographical and factual errors. Personal comments / opinion may be interspersed with "facts." If this information is important to you, go to the source. I do this simply for my benefit to insure that I really do read the article and not skim through it.

This is taken from "episode 2" of RBN Energy's update of US LPG exports from the Gulf coast. It really is quite an amazing story and suggests that one of the big stories of the 21st century will be the emergence of US as the global energy powerhouse.

Some of the data points follow.

First, the data points from "episode 1":

• US domestic production of NGLs (like propane and butane is soaring
• US liquified propane gas (LPG) exports in the past three years have rocketed to the top
• US exports of LPG now surpasses exports by the old Big Three: UAE, Qatar ("cutter"), and Algeria
• the rise in LPG exports may be ending
• exports from the Gulf coast may be in for a decline
• more propane and butane from the Marcellus and Utica will be re-routed to Marcus Hook, PA
• demand for new propane dehydrogenation plans and flexible steam crackers will be climbing

This episode, episode 2, will focus on how the Panama expansion will affect LPG exports. The data points follow.

• the Panama expansion will be operations within a few weeks
• all but the world's very biggest LNG vessels will be able to transit the canal
• huge times savings from the Gulf coast to Asia: from more than six weeks (around Cape of Good Hope) to three weeks (Panama Canal)
• daily rates for these sea-going tankers have tanked
• two "events" have changed LPG export dynamics: Marcus Hook and PDH
• Mariner East 2 pipeline across Pennsylvania will re-route 275,000 bopd by 2017; to Marcus Hook, PA
• once at Marcus Hook, LPG-BR (rail) across the US; propane at those terminals is at the expense of propane at Gulf coast terminals
• more domestic processing through increased number of PDH plants
• US LPG exports have been on a tear
• January, 2013: 184,000 bopd LPG exports from Gulf coast
• January, 2016: 1,047,000 bopd LPG exports from Gulf coast (nearly six-fold increase in three years)
• destinations:
• exports to China: 111,000 bopd (up from 17,000)
• Japan 70,000 bopd (up from 55,000)
• South Korea: 37,000 bopd (up from 11,000 bopd)
• Singapore: 30,000 bopd (up from 4,000 bopd)
• China is the biggest importer of US LPG, beating out Canada (87,000 bopd in 2015, more than half was ethane)
• rounding out the top six: Mexico (91,000), Brazil (47,000), and the Netherlands (46,000), Dominican Republic (32,000)
• the LPG export terminals along the Gulf coast
• EPD/Houston Ship Channel: 
• completed its 2015 expansion; can now load one VLGC every 24 hours (from 300,000 bopd to 533,000 bopd)
• Targa Resources/Galena Park
• 3Q14: completed its expansion, from 100,000 bopd to 233,000 bopd 
• Sunoco Logistics/Nederland/Mariner South
• anchor customer is Shell; 150,000 bopd, or almost 20% of Gulf coast exports
• Occidental Petroleum/Ingleside
• commissioned in 2015, but exports have been negligible
• Phillips 66/Freeport
• building the latest LPG export terminal, a 150,000 bopd facility at Freeport, TX; to be on-line 3Q16; completed; first shipment December 16, 2016
• Buckeye Partners/Trafigure/Corpus Christi
• accounts for about 2% of Gulf coast exports so far this year

• Total LPG export capacity from Gulf coast: 1,200,000 bopd export capacity

Bottom line: Marcus Hook, PA, and PHD plants in the US have changed the dynamics of US LPG exports. 

Phishing For Phools -- December 8, 2015

Updates

December 20, 2016: the Freeport terminal is on-line; first shipment sailed December 16, 2016.

Later, 12:21 p.m. CT: see first comment. Just after receiving that comment, I saw this story. Phillips 66 commissions a 100,000 b/d NGL factionator in Texas -- 

Phillips 66 Co. has commissioned a 100,000-b/d NGL fractionator near its 247,000-b/d Sweeny refinery in Old Ocean, TX.

Supported by 250 miles of pipelines and a multimillion-barrel storage cavern complex, Sweeny Fractionator One is now producing purity ethane and LPGs that deliver via pipeline to local petrochemical customers as well as to the market hub at Mont Belvieu, TX.

The company said it expects to begin LPG deliveries to international markets once it completes the 150,000-b/d LPG export terminal at Phillips 66’s existing marine terminal in Freeport, TX.

The Freeport LPG export terminal, which will have an initial export capacity of 4.4 million bbl/month, remains on schedule for startup during second-half 2016.

At a combined capital investment of more than $3 billion, Sweeny Fractionator One and the Freeport LPG export terminal will connect to a 100,000-b/d de-ethanizer unit to be installed at the Old Ocean site that will upgrade US propane for export  

December 8, 2015: here's another example of the cost of new natural gas projects. Seeking Alpha is reporting on the Caithness Moxie Freedom power plant in Luzerne County, PA, the first plant using GEs high efficiency 7HA.02 gas turbines to be project financed.

The 1,029 megawatt (MW) plant will be able to generate the equivalent power needed to supply approximately one million US homes.  

GE Energy Financial Services and its co-leads arranged $592 million senior secured credit facilities to support the Caithness Moxie Freedom Projects construction and operation, with eight other banks in the syndicate. 

I don't know if this is the total cost of the project, but if so, $592 million / 1,029 MW = $575,315 / MW.

Compare that with $6 million / MW that the Minneapolis folks paid for a few MW of solar energy at their airport.

Also note the efficiency of these turbines:

GEs HA gas turbines are the worlds largest and most efficient at more than 61% combined cycle efficiency, and lead the industry in total life-cycle value. HA technology provides cleaner, reliable and cost-effective conversion of fuel to electricity.

Compare that to the load factor of solar energy: 9%.

Original Post

 

Finally some good news coming out of Minnesota. This is a nice story coming out of Minnesota because it gives us current cost estimates for a new natural gas plant vs solar/wind.

PrairieBizMagazine is reporting:

Minnesota Power is moving forward with plans to build a major natural gas-fired power plant, accepting bids through January from multiple companies in an ongoing push to move away from coal.

The utility is expected to negotiate with multiple bidders in 2016 for the plant which could be built anywhere in the Upper Midwest -- not necessarily in northern Minnesota, but within the Midwest electric grid system, company officials said.

Specifications require the proposals to be between 200 and 400 megawatts, and the facility -- essentially a large gas turbine that would fire to create electricity when demand requires -- will cost from $300 million to $400 million to build, said Al Rudeck, Minnesota Power's vice president of strategy and planning.

$400 million / 400 WM = $1 million / MW. At $300 million / 400 MW = $750,000 / MW.

Compare that to the $7 million / MW that airports in Minnesota and Wisconsin are spending for solar and then then this:

From an August 25, 2014, post, this is 30-second sound bite for "cost of renewable megawatt":

• Solar: $3 million / MW
• Wind: $2.5 million / MW
• Natural gas: $865,000 / MW

It looks like the numbers haven't changed much, except for the hobby projects at Minnesota and Wisconsin airports. Note the data about solar load factor at this post. 

Phishing for Phools.

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Phishing For Ohio Phools

When I read this article sent to me by Don, I had to laugh.

My comments back to Don:

I had to laugh -- as soon as I saw the size of the project: 20 MW.

• 20 MW with local utility committed to buy 5 MW
• $120 million
• $6 million / MW
• Phishing for Phools

The good news: the fish will have no shortage of dead-bird parts to feast upon.

Propane -- The Next Big Story -- November 27, 2015

Updates

June 22, 2017: in less than five years, the US has flipped from next importer of LPG to net exporter, and exports are surging.

Original Post

From crisis to glut in less than a year. 

John Kemp is reporting:

Liquefied petroleum gases (LPG) are the fastest-growing category of hydrocarbon exports from the United States, with volumes up almost four-fold since 2012.

Some data points:

• US propane exports, 2012: 200,000 bbls
• US propane exports, 2015: nearing one million bopd 
• composition: a range of light hydrocarbons to include ethane, butane, and propane, among others; 
• purpose: petrochemical feedstock to residential heating and cooking
• rules: unlike crude oil, LPG is treated as a refined product and can be exported with few restrictions, a position the U.S. Department of Commerce confirmed in 2014
• traditionally, most LPG has been marketed in neighbouring countries, including Canada, Mexico, Central America and the Caribbean
• in 2012, neighbouring countries accounted for 55 percent of all LPG exports, rising to almost 80 percent if South America is included.
• by 2015, however, the total share of LPG exports to other countries in the western hemisphere had dropped to just 53 percent
• exports to Europe, Africa and especially Asia have surged and now account for nearly half of all the LPG shipped abroad
• China has overtaken Canada and Mexico as the most important export market for U.S. LPG, taking more than 24 million barrels, almost 100,000 bpd, in the first eight months of 2015

Much more at the link.

Previous posts of interest:

• US propane exports, October 29, 2015
• propane rejection, July 12, 2015
• propane update, RBN Energy, December 4, 2014
• tight propane supply reaches crisis, February 10, 2014

The North American Energy Revolution -- October 29, 2015

Before we get to the "main story," here's the weekly natural gas story and gasoline demand data:

Natural gas fill (a dynamic link): 63. In the East Region, stocks were 14 Bcf below the 5-year average following net injections of 33 Bcf.

Gasoline demand (a dynamic link): significant upturn, consistent with historical trends; most recent reporting period, 9.343 million bbls vs 9.157 million bbls one week early and 8.867 million bbls one year earlier. The addiction to crude oil is back, driven by low-priced gasoline.

Now back to the main story.

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North American Oil Revolution

Propane

If there's any doubt in anyone's mind that we are witnessing a North American energy revolution, all one has to do is look at this graphic, and look that our propane exports to even Russia are increasing significantly:

But look at what is going on in the far east.

This is a "big story."

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Every Child Left Behind

Speaking of big stories, this is perhaps the saddest story of the week. This is pathetic. This is criminal. This is beyond belief. Should the NEA be brought up on RICO charges? The only way one gets to 96% failure in education is through a concerted, conspiratorial effort. CNS is reporting (becasue mainstream media won't): in the Detroit Public Shool system, nearly every student fails grade-level reading, math:

In the Detroit public school district, 96 percent of eighth graders are not proficient in mathematics and 93 percent are not proficient in reading.

That is according to the results of the 2015 National Assessment of Educational Progress tests published by the Department of Education’s National Center for Educational Statistics.

Only 4 percent of Detroit public school eighth graders are proficient or better in math and only 7 percent in reading. This is despite the fact that in the 2011-2012 school year—the latest for which the Department of Education has reported the financial data—the Detroit public schools had “total expenditures” of $18,361 per student and “current expenditures” of $13,330 per student.

And that's why President Obama wants to get rid of testing. The truth is very, very inconvenient.  President Obama was provided this data last week; on Saturday, President Obama called for less testing.

State expenditure per student (most recent data from 2011 - 2012):

• California: $58,000
• Iowa: $5,000
• Massachusetts: $14,000
• Michigan: $16,000 (Detroit is in Michigan)
• Minnesota: $9,000
• Mississippi: $4,000
• New York: $52,000
• North Dakota: $1,000
• South Dakota: $1,100 
• Pennsylvania: $23,000

I'm not sure if "free college education" is where our attention needs to be in the 2016 presidential race.

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Notes For The Granddaughters

I am now re-reading Edmund Wilson's Memoirs of Hecate County. I am finally ready to read this book. I've tried reading it twice before, giving up both times.

The first story was "The Man Who Shot Snapping Turtles." Very, very creepy and done the right way, it would be an incredibly good Halloween story.

The second story was a very long short story, "Ellen Terhune." It was a "back to the future story," every bit as good as any Stephen King novel. It was perhaps better, being told in 40 pages vs a 400-page Stephen King ghost story.

The stories are clearly based on personalities Edmund Wilson knew.

Words I've added to the list of works for the oldest granddaughter to add to her list of words to learn (for all I know, she already knows some of these) (page number in parentheses:

• sententious (33)
• dolorous (34)
• vicarious (35)
• Canova Hebe (35)
• plangency (51)
• Gorgon-like (52)

Another Must-Read RBN Energy Posting -- LPG Exports From Washington State

Active rigs:

	4/15/2014	04/15/2013	04/15/2012	04/15/2011	04/15/2010
Active Rigs	188	186	206	174	108

RBN Energy: an update on the LPG export industry in Washington State.

On March 4th, Petrogas announced the purchase of the Ferndale, WA LPG terminal, the only functioning butane and propane export facility on the U.S. west coast.  Then last Thursday (April 10th) Sage Midstream announced a project to build another world scale LPG (liquefied petroleum gas) export terminal a couple of hundred miles south at the Port of Longview, WA.  These are big developments for the west coast LPG markets. Today we begin a blog series that examines the history of Ferndale, how it has been used in the past, and what these two announcements mean for the future of west coast propane and butane markets.

Rusty and I both have a warm spot in our heart for Ferndale, having managed the commercial activities out of that terminal more than two decades ago when we were with Texaco.  Ferndale is a 750MBbl storage, tank car, truck and waterborne import/export facility that sits near several Northwest area refineries, and is just a tank car ride away from some of the richest natural gas liquids (NGL) producing areas in North America.  For most of its existence, Ferndale has been the backwater of NGL markets, almost exclusively used for butane exports to Latin America and the Asia/Pacific markets.  But now NGL markets are changing dramatically due to the onslaught of new production from the shale revolution.  And exports have become the market of choice for NGL surpluses.  Up to now most of the action in exports has been along the Gulf Coast, and to a lesser extent in the Northeast out of the Marcus Hook terminal.   

But now attention is shifting to the West Coast.

And I think that's the big story: the US energy story shifting from the east to the west.

The other reason to read it: a bit of personal history of the blog's author is there.

The Wall Street Journal

Obama, Putin talk as unrest roils Ukraine. To me, listening to NPR this morning, this sounds just like Syria all over again. With much more at stake.

I reported this yesterday; I think it's a bigger story than most Jaywalkers realize (even if they knew): US retail sales surged 1.1%. Best monthly growth since September, 2012. Pent-up demand after a long winter. Or more likely, as the winter wore on and on, folks ran out of winter "stuff," and had to re-stock.

CBO sees US deficit shrinking more than expected in 2014.

The CBO, a nonpartisan agency that advises Congress on budget policy, on Monday said the adjustments will lower its forecast for the 2014 deficit to $492 billion, or $23 billion less than it estimated two months ago. That's equivalent to 2.8% of gross domestic product, marking the smallest deficit since 2007. Since 1980, the deficit has averaged roughly 3.2% of GDP. 

The Malaysian plane is in water too deep for a robotic sub to reach. Search are is 81,000 square miles; pace of search: 15 square miles daily. OK. CNN has a story for the next 1,000 days.

GE already tired of Immelt?

US DOE snookered. Hong Kong billionaire Richard Li is expected to make a killing on the Fisker Automotive loan he bought from the Department of Energy.

Data of about 900 Canadians taken in Heartbleed breach.

This makes me feel good. I mentioned at Starbucks the "mini-crash" on Friday was not a typical stock-market-wide correction. I noted that it only affected biotech and tech, perhaps, in general, suggesting that energy firms actually did fine (and the price of oil actually rose). Now today, top story, third section: "Now that markets are no longer moving in lock step, corporate fundamentals, and the ability to pick stocks, are becoming more important." Think HK and GDP (Goodrich Petroleum).

CSX hit hard by the war on coal. Warren might have been on the same track when he bought BNI had the Bakken not come along.

Wheat rises 3% as Ukraine tensions threaten exports, production. Good news for NoDak farmers.

The Los Angeles Times

The Dickinson Press

Dickinson Public Schools mulls $67 million in building projects.

Another LPG-Export Terminal

In the process of searching for something else, I ran across this, as reported by Argus Media.

Data points:

• new LPG-export terminal; Beaumont, Texas; Japan + European joint venture
• exports predominantly to Asia-Pacific
• hinted at this project in 2011 due to glut of propane but didn't say anything until yesterday
• Japan: 34% stake
• first phase: $500 million; will include a 100,00 b/d de-ethanizer (strip ethane from propane)
• to be completed by 4Q14
• differential between US propane / Asian propane: $452/t
• several other LPG-export facilities mentioned in the linked article

Note: the ethane will be stripped out, adding to even more ethane stateside. (Corrected: see comment from "anon 1.")