Pembina Pipeline opens LPG export facility – the 2nd in West Canada


Canadian infrastructure and storage company Pembina Pipeline announced today it opened its first propane marine export facility in British Columbia, Canada. Accordingly, the Prince Rupert Terminal, located on Watson Island, began loading propane from rail cars onto vessels on March 19. In fact, this terminal started liquified petroleum gas (LPG) commercial activities for international markets on April 9.

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Pembina Pipeline opens first LPG export facility

Canada-based Pembina Pipeline announced today it opened its first propane marine export facility in Watson Island, British Columbia. In fact, on March 19, Pembina completed dry commissioning of the LPG terminal. Besides, the Company began loading propane from rail cars onto vessels destined for international markets on April 9.

In this sense, the Company will extract propane off-site from natural gas supply in northern British Columbia and Alberta. Therefore, it will transport the LPG by rail from its Redwater Complex northeast of Edmonton to Prince Rupert. Finally, Pembina will offload and store at the terminal the extracted propane.

According to Pembina’s fourth quarter and full-year 2020 financial statement: “This project is important as it represents our first export facility. Therefore, it will provide customers with improved access to more international markets and attract higher pricing for their propane.”

Notably, the terminal will operate at 20,000 barrels per day (bpd). Moreover, according to Pembina, it will have a capacity of 25,000 bpd. Indeed, the project capital budget was $250 million.

Pembina is a transportation and midstream service provider serving North America’s energy industry for more than 65 years. Pembina owns an integrated system of pipelines that transport hydrocarbon liquids and natural gas products produced primarily in western Canada.

Potentialities of Canadian LPG

Indeed, as previous investor materials stated, the $250mn export terminal was initially slated to be in service in the first quarter of 2021. Thus, last year Pembina deferred a planned expansion of the new facility.

Therefore, earlier last month, the company said it would provide an update on the status of its terminal project. The Prince Rupert Terminal is the second export terminal on Canada’s west coast.

For Canada, additional export capacity out of the western territories came in March from AltaGas’ 40,000 b/d refrigerated export facility. Thus, the Ridley Island propane export terminal, or Ripet, ramped up loadings to 50,600 b/d in December and January. Actually, this was to meet the strong demand for propane in Asia, particularly Japan.

In fact, delays along the Panama Canal last winter bolstered delivered propane prices in Asia and led to greater demand for Canadian LPG. Notably, this boost was possible given the shorter, 10-day voyage versus the US Gulf Coast.

Hence, approximately 70pc of Ripet’s 2021 export volumes come through either long-term tolling agreements or financial hedges relative to the Far East Index.

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