US ethane feedstock demand rose in Q1

OREANDA-NEWS. Ethane consumption by US ethylene crackers rose by 39,457 b/d during the first quarter as demand for the lighter feedstock emerged as Williams began to restart its Geismar, Louisiana, plant.

Quarterly ethane consumption stood at 1.078mn b/d, according to the American Fuel and Petrochemical Manufacturers (AFPM).

Williams began producing commercial-grade ethylene from their newly expanded 1.95bn lb/yr cracker on 28 March. The company went through a series of failed restarts during the quarter, resulting in the increased consumption of ethane.

Ethane consumption is expected to rise in coming quarters as Geismar ramps up and additional expansion projects come online.

Ethane consumption rose even though margins for cracking ethane in the first quarter were less favorable. Propane and butane margins were stronger for much of the first quarter months.

At the beginning of January, ethane's margins stood at 29.34?/lb, while butane and propane stood at 37.85?/lb and 41.06?/lb, respectively. As the quarter progressed, margins saw more balance and ethane margins ended March at 20.06?/lb. Propane and butane stood at 23.43?/lb and 24.52?/lb, respectively.

During the first quarter, spot ethane prices at Mont Belvieu, Texas, averaged 18.735?/USG, ranging between 16.75-22.125?/USG.

Propane consumption by ethylene crackers also rose, by 23,831 b/d to stand at 350,946 b/d, while butane consumption firmed by 6,657 b/d to 141,377 b/d.