Ethane prices picked up this week as light NGLs showed greater strength, if not higher values, than their heavy counterparts for the second straight week at both Mont Belvieu and Conway.
NGL prices continued to fall for the eighth straight week at both Conway and Mont Belvieu as limited transportation and cracking capacity, increased processing capacity and falling crude oil prices are having negative effects on the market.
Conway ethane margins dropped nearly 100% in the month of April as prices suffered from the delay in the start-up of transportation of E-P mix out of the hub to Nova Petrochemical’s plant in Sarnia, Canada.
Ethane prices moved in opposite directions between Mont Belvieu and Conway as the Gulf Coast price rose 7% while the Mid-Continent price fell 22%, which pushed its frac spread into a negative zone.
Ethane prices fell at both hubs this week due to several ethane crackers remaining down because of scheduled maintenance combined with weak propane prices.
Despite NGL prices remaining flat throughout the month, a sharp drop in natural gas prices helped support frac-spread margins in March at both Conway and Mont Belvieu.
There is concern that propane could overtake ethane prices as the most preferred petrochemical feedstock due to the propane storage overhang. However, increased propane exports should alleviate this concern.
Natural gas liquid (NGL) prices were relatively flat this past week as they followed crude oil prices, which have been in a holding pattern the last two weeks.
Natural gas liquids (NGL) prices and frac spread margins made gains the week of Feb. 29 as prices continued to stabilize and rebalance. Frac spread margins also benefitted from the continued depression of natural gas prices.