Propane now US’ second-largest petroleum product export

The Galena Park Marine Terminal is one of only two commercial propane export facilities in the U.S. Gulf Coast, according to Targa Resources. Targa Resources, a provider of midstream natural gas and NGL services, is being recognized in the Chronicle 100 special section.

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Propane is now the second-largest U.S. petroleum product export, surpassing motor gasoline, the Energy Information Administration reported Wednesday.

U.S. propane exports increased from 562,000 barrels per day in the first half of 2015 to 793,000 bpd in the first half 2016. Exports to Asia and Oceania accounted for 94 percent of this growth. Japan imported the most U.S. propane at 159,000 bpd in the first half of 2016, an increase of 111,000 bpd from 48,000 bpd in the first half 2015. Exports to Panama, however, fell from 41,000 bpd in the first half 2015 to 7,000 bpd in the first half 2016, according to the report.

The EIA said the large increases in exports to Japan and the significant drop to Panama might be explained by reduced ship-to-ship transfer activity.

“Transfers on the Atlantic Ocean side of the Panama Canal likely involve moving cargo from a ship too large to transit the canal onto a slightly smaller ship that can make the passage,” according to an EIA report released in April. “Once through the canal, the smaller ship will either continue on to Asia or transfer the cargo back to a larger ship to complete the journey.”

As a result, some data represent delivery to the transfer site — such as Panama, Aruba and the Dominican Republic — and not the final destination, which can skew the actual final destination numbers. A Panama Canal construction project to accommodate larger vessels recently was finished, and there have been fewer propane transfers.

Demand for propane in Asia is driven largely by an expanding petrochemical industry that uses propane as a feedstock, as well as other industrial and consumer heating and cooking demand, according to the April report.

Wednesday’s report also said Mexico (775,000 bpd), Canada (579,000 bpd) and the Netherlands (271,000 bpd) received the significant volumes of U.S. petroleum products in the first half of 2016.

Gasoline exports increased 138,000 bpd in the first half of 2016 compared with the first half of 2015. Mexico represents the largest single recipient of U.S. gasoline exports at 363,000 bpd, up from 283,000 bpd in the first half of 2015, the EIA said.