Ethane exports from the Enterprise Products Partners LP’s (NYSE: EPD) Morgan’s Point terminal rose 12% in February compared to January, reaching an average of 17,000 barrels per day (bbl/d).

EnVantage expects March to be another strong month for exports, a positive sign for ethane, which has been scuffling on the price side. Trouble is, the Houston Ship Channel terminal is picking up the slack from Marcus Hook, Pa.

Those meddlesome sink holes in West Chester County, Pa., which exposed a chunk of the Mariner East 1, have shut down Energy Transfer’s NGL pipeline, forcing a rerouting of product from the Pennsylvania terminal to the Gulf Coast in order to move it to export markets. Energy Transfer’s Mariner East 2 pipeline remains incomplete. One cargo did depart Marcus Hook in February, but EnVantage believes the ships were loaded from inventory already stored at the terminal. It’s unlikely that any cargoes will leave Marcus Hook this month, the analysts said.

Frac Spread

And expect it to stay that way. Pennsylvania’s attorney general announced via Twitter on March 12 that he would launch an investigation into Mariner East 2 and “will leave no stone unturned in this case.” A day earlier, Delaware County, Pa., District Attorney Katayoun Copeland opened her own investigation, this time into Mariner East 1, Mariner East 2 and Mariner East 2X (a 16-inch line that will run parallel to Mariner East 2).

The Mont Belvieu, Texas, average ethane price last week remained under 30 cents per gallon (gal) for the fifth week in a row. The price was 15.2% above where it was a year ago. Its margin expanded by 9.4% in that last week.

Propane exports, says EnVantage, have suffered some lately because of foggy conditions for tankers on the Gulf Coast. The fog will clear on its own but the surplus might need some more help. The solution is to expand exports from an average of 900,000 bbl/d to 1.2 million bbl/d.

For that to happen, the price of propane will need to drop to less than 50% of West Texas Intermediate (WTI) crude prices. The analysts anticipate that the price will drop into the 45%-to-50% range in the second half of March, and into the 40%-to-45% range by the end of October.

NGL prices

Propane’s price at Mont Belvieu rose slightly to just under 70 cents/gal, well below its price last year at this time. In the last week, propane’s margin expanded slightly.

Butanes dropped in price for the third straight week, although a slight bump in pentanes-plus lifted it to its highest level since late October.

Resin prices 

In the week ended March 8, storage of natural gas in the Lower 48 experienced a decrease of 204 billion cubic feet (Bcf), the EIA reported, compared to the Stratas Advisors prediction of a 215 Bcf withdrawal and the Bloomberg consensus of a 210 Bcf withdrawal. The figure resulted in a total of 1.186 trillion cubic feet (Tcf). That is 23.2% below the 1.545 Tcf figure at the same time in 2018 and 32.4% below the five-year average of 1.755 Tcf.

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