World LPG Association leaders discuss growing gallons globally

The propane market is impacted by global factors now more than ever, as propane produced in the U.S. is exported to locations around the globe.

“Changes that are happening in the marketplace around the world affect what’s happening here in the U.S.,” says Eric Kuster, director of safety and certification for the National Propane Gas Association (NPGA).

A panel session at the NPGA Southeastern Convention & International Propane Expo focused on this topic. According to Michael Kelly, deputy managing director and director of market development for the World LPG Association (WLPGA), the goal of the panel was to communicate to the American propane industry some of the trends that are taking place around the world that could impact its businesses.

The feasibility of maritime applications of propane is one new development. The WLPGA is leading studies in the use of propane to power shipping freighters.

There are several factors driving the use of propane in marine shipping, including regulatory restrictions, stakeholder pressure, availability of new energy sources, pricing – the price of propane is dropping, which may give it an advantage – and the increasing awareness of alternative fuels.

“Control of emissions is the game today,” says Nikos Xydas, technical director for WLPGA.

Currently, shipping freighters must limit their sulfur oxide emissions to 3.5 percent. By 2020, all shipping companies will be required to reduce that number to 0.5 percent. According to Xydas, ship operators have several options to manage these new rules, including switching to marine gas oil or low sulfur fuel; equipping their vessels with scrubbers, which are filters that take out sulfur; or using alternative fuels.

Companies such as Astomos Energy have been convinced that propane is a viable marine fuel option for large vessels, Xydas says. The propane engines are less costly to maintain, and they benefit from an existing LP gas supply chain, which is appealing to many companies.

According to Xydas, though, many companies are skeptical about the amount of propane available to sustain such an application, but he doesn’t foresee that as an issue.

“By 2027, we estimate propane production to be around 357 billion tons, with the U.S. as the biggest producer,” Xydas says.