The US is producing a record supply of ethane, hitting a new high in October ’24 for the fourth time on the year. Global petrochemicals are preparing to source more of the abundant and cheap feedstock. East Daley Analytics recently covered how Braskem will import more US ethane by the middle of 2025, and we suspect INEOS is preparing to do the same.
INEOS is building the Project One ethane cracker in the Port of Antwerp in the Netherlands. Project One is designed to make up to 1.45MM tons of ethylene per year. A facility of that scale will require more than 80 Mb/d of ethane to run at capacity.
East Daley has not seen public disclosure of where INEOS will source ethane to supply the project, but we speculate the company is an anchor customer for Enterprise Products’ (EPD) new ethane export facility, Neches River.
EDA tracks the Neches River project in the monthly Ethane Supply & Demand Report. EPD plans to begin operations at the Texas facility in two phases. Phase I would start in 3Q25 and includes a 120 Mb/d ethane refrigeration train, new loading dock, and a 900 Mbbl refrigeration tank. In Phase II, EPD is building a flex refrigeration train of 180 Mb/d ethane, 360 Mb/d propane, or a combination of both. Phase II has an in-service target of 1H26.
This would not be INEOS’ first foray into sourcing US ethane. The JS INEOS Intrepid and JS INEOS Insight were the first vessels loaded from Energy Transfer’s (ET) Marcus Hook terminal in March ’16 and EPD’s Morgan’s Point dock in September ’16, for use in the company’s Rafnes, Norway ethylene cracker.
Data in Energy Data Studio shows the ET and EPD export facilities are both operating at or near capacity (only Marcus Hook is shown in the figure). The green-shaded area of the figure shows ethane exports and the green line is export capacity at Marcus Hook, including potential upside from an expansion project East Daley has written about. The pink line represents capacity if the expansion does not occur.
Project One has hit some snags. In July ’23, the Council of Permit Disputes annulled a permit needed to continue construction. The dip in financing drawn on the €4B capital project is evident in 3Q23 (see second figure).
Construction on Project One resumed in January ’24 when the Flemish Minister for Justice & Enforcement re-issued a new permit. Total financing used for construction so far totals €1.6B. INEOS expects construction to finish by YE26. By then, EPD’s Neches River and Enterprise Hydrocarbon Terminal (EHT) facilities will be operational, allowing the company to use Neches River exclusively for ethane exports. – Rob Wilson, CFA Tickers: EPD, ET.
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