Petrochemical Update is now Reuters Events - LEARN MORE
Oil price to average $52 in 2017; Magellan Midstream plans marine terminal
Petrochemicals news you need to know.
Brent price to average $44 in 2016
Brent crude oil prices are forecast to average $44/b in 2016 and $52/b in 2017, according to the U.S. Energy Information Administration’s (EIA) Short-Term Energy Outlook (STEO) published on July 12. West Texas Intermediate (WTI) crude oil prices are forecast to be the same as Brent in 2016 and in 2017.
However, the current values of futures and options contracts suggest high uncertainty in the price outlook. For example, EIA's forecast for the average WTI price in October 2016 of $48/b should be considered in the context of Nymex contract values for October 2016 delivery, the EIA said.
Contracts traded during the five-day period ending July 7 suggest the market expects WTI prices could range from $35/b to $67/b (at the 95% confidence interval) in October 2016.
Meanwhile, Henry Hub spot prices are forecast to average $2.36/million British thermal units (MMBtu) in 2016 and $2.95/MMBtu in 2017, compared with an average of $2.63/MMBtu in 2015.
Enterprise starts US export terminal
Enterprise Products Partners has begun the initial start-up and commissioning of its new 200,000 b/d Morgan's Point ethane export terminal at La Porte, Texas, Argus Media reported on July 12, citing an air emission report that Enterprise had filed with the Texas Commission on Environmental Quality.
RIL has long-term storage and capacity agreements with the Morgan’s Point facility for the liquefaction and export of 1.5 mtpa of ethane as feedstock for its India crackers. RIL has also ordered six very large ethane carriers (VLECs) ahead of the ethane terminal's start-up for delivery in the fourth quarter of 2016.
In March this year, Braskem also announced it had entered into a 10-year ethane supply contract with Enterprise, which will meet up to 15% of the feedstock needs for Braskem's cracker in Bahia state in Brazil, starting in mid-2017.
Meanwhile, Enterprise announced on July 19 that it had loaded its first two vessels with polymer grade propylene (PGP) for export at the Enterprise Hydrocarbons Terminal along the Houston Ship Channel, adding a new service at the facility.
The company is expecting an increase in the number of PGP export cargoes to meet growing international demand. Enterprise has the capacity to load 5,000 metric tons per day of refrigerated PGP at the terminal dock facilities, which are supplied directly by propylene fractionators and storage wells at Enterprise’s Mont Belvieu, Texas complex.
Meridian gets zoning permit for North Dakota refinery
Meridian Energy Group Inc. has received the first of two critical permits required for the development of its proposed 55,000-b/sd Davis refinery in Billings County, North Dakota, the Oil & Gas Journal reported on July 7.
On July 6, the Billings County Board of County Commissioners (BCBCC) unanimously approved the zoning certificate and conditional-use permit for the proposed two-phased grassroots refinery project, the first phase of which will include a 27,500-b/sd single crude unit and ancillary processing units, Meridian said.
The company said it plans to file an application with the air quality division of North Dakota’s health department to obtain a permit to build.
Applications for permits to proceed with construction of Phase 2 to expand the refinery to its nameplate 55,000-b/sd capacity will follow the start-up of Phase 1, which is expected in 2017. The fully expanded Davis refinery is slated to be commissioned in 2019.
Magellan Midstream to build new Texas marine terminal
Magellan Midstream Partners plans to build a new $335 million high-capacity marine terminal along the Houston Ship Channel in Pasadena, Texas to handle refined petroleum products, including various grades of gasoline and diesel fuel, and renewable fuels, the company announced on July 14.
Magellan initially plans to build approximately 1 million barrels of refined products and ethanol storage and a new marine dock capable of handling Panamax-sized ships or barges with up to a 40-foot draft. The company is also constructing a 36-inch pipeline between the partnership’s existing terminal in Galena Park, Texas and the new Pasadena terminal.
Magellan is also connecting its existing 18-inch Texas City-to-Pasadena pipeline to the new facility and developing opportunities for additional connections to third-party refineries, pipelines and terminals within the Gulf Coast region.
Magellan expects its new Pasadena terminal to be operational in early 2019.
North American chemical rail traffic lags
Chemical railcar traffic in North America during the week ending on July 9 decreased 7.8% year on year and 7.5% from the previous week on a steep decline in U.S. volume, according to data released on July 13 by the Association of American Railroads (AAR).
Chemical railcar traffic during the week totaled 39,586 carloads, of which the United States contributed 28,013 carloads. This is down 10.3% from the previous week and down 10.2% year on year.
Meanwhile, chemical railcar traffic in North America in the year to date is down 0.2% while all railcar traffic has dropped 11.6%. For the year to date, U.S. chemical railcar traffic is up 1.9%, versus a 12.5% decrease in all railcar traffic.
Canadian chemical rail volume totaled 10,531 carloads during the week that ended on July 9, up 1.1% from the previous week and down 1.3% compared to the same time last year. For the year to date, Canadian chemical railcar traffic is down 5.9% versus a 11.1% decrease in all railcar traffic.
Chemical railcar traffic in Mexico totaled 1,042 carloads, 8.8% lower than the previous week and 3.3% down year on year. For the year to date, Mexican chemical railcar traffic is up 4.4% compared to a 0.5% increase in all railcar traffic.