Enterprise co-loads NGLs, olefins for export from US for first time

Houston — Enterprise Products Partners loaded combination cargoes of NGLs and olefins on the same ship in Texas, the company said July 14, in what it argued were the first export cargoes of their kind from the US.

The company completed simultaneous loading of propane and polymer-grade propylene into separate compartments on a VLGC at its Houston Ship Channel terminal during the month of July, Enterprise said. "The Future Diamond was loaded with propane/propylene at our EHT terminal in early July and was bound for Asia," an Enterprise representative said in an email July 14.

Enterprise also completed simultaneous loading of ethane and ethylene on a vessel at its Morgan's Point facility, the company said. No information is being shared publicly about the ship loaded at Morgan's Point, the representative said in the email.

Co-loading olefins on larger vessels with NGLs allows for more efficient use of available export dock capacity, while also providing significant freight benefits to petrochemical export customers, the company said.

"Loading ethylene and propylene on larger vessels from the US Gulf Coast substantially lowers freight costs and allows US Gulf Coast producers to supply distant markets, such as Asia, more competitively," said A.J. Teague, co-CEO of Enterprise's general partner, said in a statement.

This will make larger vessels more competitive, and may "not be so good for Handysize owners. For sure, [petrochemical freight rates] will go down when loading on VLGCs," one source said.

"I think co-loading of propane and propylene has been done for years, but ethane plus ethylene is the new situation, with Enterprise's new ethylene export capability. In both cases it lowers the loading and shipping costs, improving export economics," a second source said.

However, the volumes involved would dictate whether the impact on the market would be significant and what real competitive edge it affords, a third source said.

"We think this will only be an occasional event going forward," a fourth source said.