Canadian NGL producers challenged by market access limits

August 22, 2019 By    
Photo: AltaGas

AltaGas’ new Ridley Island Propane Export Terminal. Photo courtesy of AltaGas

Strong natural gas liquids (NGL) production in western Canada over the past two years has underscored the need for Canadian producers to seek demand outlets, particularly for propane, and move barrels otherwise stranded in the region.

Amy Strahan, editor of NGL Americas at Argus, shared this trend and others in a May webinar about Canada’s LPG market.

Total Canadian inventories of propane and butane are up versus last year, Strahan says, leading producers to pursue higher-priced markets in the United States – U.S. imports from Canada in January were well above year-ago levels – or exports to overseas markets.

The presentation noted how propane and butane prices at the Edmonton hub have been discounted compared to the U.S. market and how petrochemical investments have helped to reduce some of the production and supply overhang. But the waterborne export market along Canada’s west coast – with critical demand in Asia – seems to be a growing opportunity for producers, as companies like AltaGas, Pembina and Pacific Traverse Energy pursue export terminal projects.

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About the Author:

Brian Richesson is the editor in chief of LP Gas Magazine. Contact him at brichesson@northcoastmedia.net or 216-706-3748.

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