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www.eia.gov U.S. Energy Information Administration Independent Statistics & Analysis
Energy Exports
for Benposium 2015 June 9, 2015 | Houston, Texas by Howard Gruenspecht, Deputy Administrator
Key Takeaways
2
• In most of EIA’s current projection cases, U.S. net energy imports, including all fuels, decline and ultimately end for the first time since the 1950s
– Strong growth in domestic production of crude oil from tight formations through 2020 and limited growth in domestic demand after 2020 leads to a decline in net petroleum and other liquids imports. With high prices or high resources, the United States becomes a net exporter of petroleum and other liquids.
– The United States transitions from being a net importer of natural gas to a net exporter by 2017 in all cases
• Exports, both net and gross, have been rising rapidly. Key drivers in the export outlook vary across fuels and timeframes
• Natural gas exports – drivers looking forward:
– U.S. resource and technology scenario (a key driver of domestic gas prices); global energy market prices (which along with domestic prices defines the “gap” that determines the incentive for investment in natural gas export facilities and their use
– Environmental and energy policies that significantly affect domestic natural gas demand, such as the final Clean Power Plan
– Mexico demand (pipeline exports)
Benposium2015, Energy exports June 9, 2015
Key takeaways
3
• HGL exports – drivers looking forward
– production of HGLs, primarily linked to natural gas production
– domestic consumption of HGL feedstock
– spreads between domestic and global prices
– economics of ethane rejection
• Crude oil and non-HGL petroleum product exports – drivers looking forward
– With fuel efficiency policies moderating the domestic consumption response to price and economic changes, domestic crude oil production growth, reflecting resources, technology, and prices, is key driver of combined crude oil and non-HGL product exports.
– In high production scenarios under current laws and policies that allow unrestricted exports of processed petroleum products but restrict crude exports, product exports grow significantly
– Without restrictions on crude exports, crude export growth would displace a portion of product export growth in high production scenarios
Benposium2015, Energy exports June 9, 2015
How we got here and where we might be going
4 Benposium2015, Energy exports June 9, 2015
-30
-20
-10
0
10
20
30
40
2005 2010 2015 2020 2025 2030 2035 2040
U.S. net energy imports continue to decline in the near term, reflecting increased oil and natural gas production coupled with slow demand growth
5
U.S. net energy imports quadrillion Btu
Source: EIA, Annual Energy Outlook 2015
History Projections 2013
High Oil Price
High Oil and Gas Resource
Reference Low Oil Price
Benposium2015, Energy exports June 9, 2015
U.S. natural gas imports and exports trillion cubic feet
-8
-4
0
4
8
12
16
2000 2010 2020 2030 2040 2020 2030 2040 2020 2030 2040
LNG imports
Source: EIA, Annual Energy Outlook 2015
6
billion cubic feet per day
Projected U.S. natural gas exports reflect the spread between domestic natural gas prices and world energy prices
Projections History 2013
-10
0
10
20
2013 2013
30
40
-20 Reference Low Oil Price High Oil and Gas
Resource
Pipeline exports to Mexico
Lower 48 states LNG exports
Pipeline exports to Canada Pipeline imports from Canada
Alaska LNG exports
Benposium2015, Energy exports June 9, 2015
-30
-20
-10
0
10
20
30
40
50
60
70
2005 2010 2015 2020 2025 2030 2035 2040
Net liquid imports are a declining share of U.S. liquid fuels use in most AEO2015 cases; in two cases the nation becomes a net liquids exporter
7
net crude oil and petroleum product imports as a percentage of total U.S. supply percent
Source: EIA, Annual Energy Outlook 2015
History Projections 2013
High Oil Price
High Oil and Gas Resource
Reference
Low Oil Price
Benposium2015, Energy exports June 9, 2015
U.S. net imports of crude oil and petroleum products declined by more than 7 million b/d over the past decade
Benposium2015, Energy exports June 9, 2015 8
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15
imports
net imports
exports
U.S. imports and exports of crude oil and petroleum products thousand barrels per day
Source: EIA, Petroleum Supply Monthly
Hydrocarbon Gas Liquids
9 Benposium2015, Energy exports June 9, 2015
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
2008 2009 2010 2011 2012 2013 2014 2015 2016
Natural gas plant liquids production
Natural gas marketed production
Growth in U.S. HGL production from natural gas plants is outpacing marketed gas production growth
10
Production indexed to Jan. 2008
Source: EIA
Benposium2015, Energy exports June 9, 2015
History Forecast
U.S. propane exports have grown in the past few years; exports averaged over 500 kb/d in the first quarter of 2015
Benposium2015, Energy exports June 9, 2015 11
U.S. imports and exports of propane thousand barrels per day
Source: EIA, Petroleum Supply Monthly
-600
-400
-200
0
200
400
600
800
Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15
imports
net imports
exports
Current U.S. propane/butane export capacity is fully utilized as exports continue to rise
12
Monthly exports thousand barrels per day
Note: Monthly throughput can exceed annualized nameplate export capacity. Source: Export data from EIA; Capacity calculated from company and news reports
Benposium2015, Energy exports June 9, 2015
0
100
200
300
400
500
600
700
800
900
Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14 Jul-14 Jan-15
Butanes Exports
Propane Exports
Non-ref export capacity
Refrigerated export capacity
Significant discounting of HGL prices in North American markets persists
Benposium2015, Energy exports June 9, 2015 13
International propane prices U.S. dollars per gallon
International butane prices U.S. dollars per gallon
0.00
0.50
1.00
1.50
2.00
2.50
3.00
2009 2010 2011 2012 2013 2014 2015
Saudi Aramco ContractMt. Belvieu Spot
Note: All prices through 06/01/2015 are close-of-day prices except for Aramco (monthly posted). Source: EIA via Bloomberg
0.00
0.50
1.00
1.50
2.00
2.50
3.00
2009 2010 2011 2012 2013 2014 2015
Far East Index SwapSaudi Aramco ContractN.W. Europe 1st Month SwapMt. Belvieu Spot
0
5
10
15
20
25
30
2008 2009 2010 2011 2012 2013 2014 2015
Motor Gasoline
Natural Gasoline
Iso-Butane
Normal Butane
Propane
Natural Gas
Ethane
Domestic HGL prices have broken from historical linkage to refined petroleum product prices
Benposium2015, Energy exports June 9, 2015 14
Note: All prices through 06/01/2015 are monthly average close-of-day spot prices; natural gas is Henry Hub, motor gasoline is Gulf Coast, and NGL components are Mt. Belvieu non-LST. Source: EIA via Bloomberg.
Gulf Coast spot prices dollars per million Btu
U.S. and Canadian petrochemical industry is responding with significant cracking capacity expansion using ethane feedstock
15 Benposium2015, Energy exports June 9, 2015
Company Location Ethane throughput1
(1,000 bbl/d) Status2 2013 2018
Existing, restarts, and capacity expansions 1,085 1,137 C/U
Feedstock conversions 19 132 C/U
New Plants ExxonMobil Chemical Co. Baytown, TX 90 U
Formosa Plastics Corp. Point Comfort, TX 63 U
Chevron Phillips Chemical Baytown, TX 90 U
Dow Chemical Co. Freeport, TX 95 U
OxyChem/Mexichem Ingleside, TX 33 U
Sasol Chemicals Lake Charles, LA 90 U
Shin-Etsu Plaquemine, LA 30 P
New 2014-18 plants 491
Total 1,105 1,760
1 Ethane throughput calculated based on plant nameplate ethylene production capacity and stated feed type 2 Status: Proposed (Q), FEED (F), Permitted (P), Under Construction (U), Completed (C) Source: EIA based on news reports and company filings.
U.S. petrochemical industry is also responding with significant propane dehydrogenation capacity build out
16 Benposium2015, Energy exports June 9, 2015
Company Location Propane throughput1
(1000 b/d) Status2
2013 2018
Existing Houston, TX 30 30 C
New Plants
Dow Chemical Freeport, TX 35 U
Enterprise Mont Belvieu, TX 35 U
Formosa Plastics Point Comfort, TX 34 U
C3 (Ascend) Petrochemicals Alvin, TX 47 P
REXtac Odessa, TX 14 F
Dow Chemical Freeport, TX 25 Q
Total 30 220
1 Propane throughput calculated based on plant nameplate propylene production capacity and historical reported propane consumption at existing plant 2 Status: Proposed (Q), FEED (F), Permitted (P), Under Construction (U), Completed (C) Source: EIA based on news reports and company filings.
U.S. HGL export capacity is expanding rapidly
17
1 C2 = ethane, C3+C4 = propane + butanes 2 Costs estimates based on publicly available reported data on some of the planned terminals 3 Status: Proposed (Q), FEED (F), Under Construction (U), Completed (C) Source: EIA based on news reports and company filings.
Benposium2015, Energy exports June 9, 2015
Company Facility Type Product1 Capacity (‘000 bbl/d) Location Est. Cost2
($ million) Completion Status3
Enterprise Refrigerated C3+C4 135 Channelview, TX - Pre-2012 C Targa Resources Semi-Refrigerated C3+C4 50 Galena Park, TX - Pre-2012 C Other Pressurized C3+C4 10 FL, VA, NY, LA - Pre-2012 C Enterprise Refrigerated C3+C4 115 Channelview, TX - 2013, Q1 C Targa Resources Refrigerated C3+C4 120 Galena Park, TX 240 2013, Q3 C Petrogas Energy Pressurized C3+C4 30 Ferndale, WA 242 2014, Q2 C Sunoco Logistics LP Refrigerated C3+C4 40 Marcus Hook, PA 270 2014, Q2 C Targa Resources Refrigerated C3+C4 120 Galena Park, TX 240 2014, Q3 C Sunoco Logistics LP Refrigerated C3+C4 197 Nederland, TX 400 2015, Q1 C Enterprise Refrigerated C3+C4 49 Channelview, TX 100 2015, Q1 C Total existing as of 3Q 2014 870 Occidental Refrigerated C3+C4 75 Corpus Christi, TX 400 2015, Q2 U Sunoco Logistics LP Refrigerated C2 35 Marcus Hook, PA 250 2015, Q3 U Enterprise Refrigerated C3+C4 227 Channelview, TX 500 2015, Q4 U Phillips66 Refrigerated C3+C4 145 Freeport, TX 1,000 2016, Q3 U Enterprise Refrigerated C2 200 Morgan's Point, TX 1,200 2016, Q3 U Pembina Pipeline Co. Refrigerated C3+C4 37 Portland, OR 500 2018 Q Total planned 4Q 2014 – 4Q 2018 720 $3.85 bil.
Average heat content of gas delivered to U.S. consumers in March 2015 was 1,036 Btu/scf; hot gas is a potential source of more ethane for both domestic and export markets
18 Benposium2015, Energy exports June 9, 2015
Source: EIA
Non-HGL Petroleum Products and Crude Oil
19 Benposium2015, Energy exports June 9, 2015
U.S. net imports of crude oil decreased roughly 2.2 million b/d from 2004 to 2015; crude exports have risen steadily since mid-2013
Benposium2015, Energy exports June 9, 2015 20
U.S. imports and exports of crude oil thousand barrels per day
Source: EIA, Petroleum Supply Monthly
0
2,000
4,000
6,000
8,000
10,000
12,000
Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15
imports
net imports
exports
“Swing” in U.S. petroleum products trade from 2 million b/d net imports to 2 million b/d net exports over 2004-15 period
Benposium2015, Energy exports June 9, 2015 21
U.S. imports and exports of petroleum products thousand barrels per day
Source: EIA, Petroleum Supply Monthly
-3,000
-2,000
-1,000
0
1,000
2,000
3,000
4,000
5,000
6,000
Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15
imports
net imports
exports
U.S. net imports of gasoline decreased by roughly 900 kb/d over the 2004-15 period; the United States is now a net gasoline exporter in winter months
Benposium2015, Energy exports June 9, 2015 22
U.S. imports and exports of gasoline* thousand barrels per day
*Note: Series represents sum of finished gasoline and blending components Source: EIA, Petroleum Supply Monthly
-400
-200
0
200
400
600
800
1,000
1,200
1,400
1,600
Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15
imports
net imports
exports
U.S. distillate exports grew steadily since 2004, with monthly exports in the range of 900 kb/d to 1,400 kb/d since early 2012
Benposium2015, Energy exports June 9, 2015 23
U.S. imports and exports of distillate thousand barrels per day
Source: EIA, Petroleum Supply Monthly
-1,500
-1,000
-500
0
500
1,000
1,500
Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15
imports
net imports
exports
0
5
10
15
20
25
30
1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040
In the transportation sector, motor gasoline use declines are driven by fuel economy policies; diesel and jet fuel use grows, but future policies could lower their use
24
transportation energy consumption by fuel quadrillion Btu
Source: EIA, Annual Energy Outlook 2015 Reference case
Projections History 2013
58% Motor gasoline
Jet fuel CNG/LNG
10%
14% 3%
44%
31%
3%
3%
Other*
Diesel 24%
2030
48%
13%
2%
31%
1%
2040
Ethanol
4%
4% 5%
*Includes aviation gasoline, propane, residual fuel oil, lubricants, electricity, and liquid hydrogen
Benposium2015, Energy exports June 9, 2015
U.S. crude oil production rises above previous historical highs before 2020 in all AEO2015 cases, with a range of longer-term outcomes
25
U.S. crude oil production million barrels per day
Source: EIA, Annual Energy Outlook 2015
0
5
10
15
20
1990 2000 2010 2020 2030 2040 2020 2030 2040 2020 2030 2040
Tight oil
Alaska
Lower 48 offshore
History 2013 2013 2013
U.S. maximum production level of 9.6 million barrels per day in 1970
Other lower 48 onshore
Reference High Oil and Gas Resource
Low Oil Price
Benposium2015, Energy exports June 9, 2015
U.S. petroleum product imports and exports million barrels per day
-4
0
4
8
12
1990 2000 2010 2020 2030 2040 2020 2030 2040 2020 2030 2040
Other petroleum product imports
Distillate
Motor gasoline exports
Other petroleum product exports
Source: EIA, Annual Energy Outlook 2015
26
U.S. net exports of petroleum products vary with the level of domestic oil production given current limits on U.S. crude oil exports
History 2013 Reference Low Oil Price
2013 2013
Motor gasoline imports
High Oil and Gas Resource
Distillate imports
-4
0
4
8
12
2005 2010 2015 2020 2025 2030 2035 2040
Total petroleum product net exports
exports
Reference
Low Oil Price
High Oil and Gas Resource Total petroleum product
net exports
Benposium2015, Energy exports June 9, 2015
Further thoughts on crude oil and petroleum product exports
27
• Future exports of crude oil and petroleum products taken together tend to rise with higher domestic production and decline with higher domestic consumption
• In high production scenarios under current laws and policies that allow unrestricted exports of processed petroleum products but restrict crude exports, product exports grow significantly
• Without restrictions on crude exports, crude export growth would displace a portion of product export growth in high production scenarios
• EIA has prepared several analyses related to this topic, and expects to provide an additional integrated analysis this summer
• With changing and volatile export markets, EIA is working to improve its export data through an agreement with Customs and Border Protection. This high-priority effort will enable EIA sharpen its closely watched weekly petroleum balances
Benposium2015, Energy exports June 9, 2015
For more information
28
U.S. Energy Information Administration home page | www.eia.gov
Annual Energy Outlook | www.eia.gov/forecasts/aeo
Short-Term Energy Outlook | www.eia.gov/forecasts/steo
International Energy Outlook | www.eia.gov/forecasts/ieo
Today In Energy | www.eia.gov/todayinenergy
Monthly Energy Review | www.eia.gov/totalenergy/data/monthly
State Energy Portal | www.eia.gov/state
Drilling Productivity Report | www.eia.gov/petroleum/drilling
Benposium2015, Energy exports June 9, 2015
Propane and ethane production growth has driven the steady increase in U.S. HGL production
Benposium2015, Energy exports June 9, 2015 29
million bbl/d 2008 2009 2010 2011 2012 2013 2014 2015 Q1 change 2008-14
Ethane 0.71 0.78 0.88 0.94 0.99 0.98 1.08 1.06 51% Propane 0.82 0.84 0.87 0.90 0.99 1.11 1.28 1.35 55% Normal butane 0.22 0.21 0.24 0.21 0.24 0.28 0.35 0.25 56% Isobutane 0.18 0.19 0.18 0.21 0.23 0.24 0.26 0.26 44% Natural gasoline 0.26 0.27 0.28 0.29 0.32 0.35 0.39 0.39 47% Propylene & other refinery olefins 0.21 0.25 0.28 0.29 0.28 0.28 0.28 0.25 35%
HGL total 2.41 2.53 2.73 2.84 3.04 3.23 3.63 3.57 50%
• Propane remains the largest-volume and highest-revenue HGL purity product
• Ethane production levels are increasing because of continuing investments in de-ethanization facilities, and ethane pipelines and export terminals.
Note: 2015 Q1 includes January to March data. Source: EIA U.S. Refiner & Blender Production and U.S. Natural Gas Plant Field Production.
-15
-10
-5
0
5
2005 2010 2015 2020 2025 2030 2035 2040
Level of net natural gas trade, including LNG exports, depends largely on resource levels and world energy prices
30
U.S. total net natural gas imports trillion cubic feet
Source: EIA, Annual Energy Outlook 2015
History Projections 2013
High Oil Price
High Oil and Gas Resource
Reference
Low Oil Price
billion cubic feet per day
-30
-20
-10
0
10
-40
Benposium2015, Energy exports June 9, 2015
20
25
30
35
2010 2015 2020 2025 2030 2035 2040
Industrial energy use rises with growth of shale gas supply
31
industrial sector total delivered energy consumption quadrillion Btu
Source: EIA, Annual Energy Outlook 2015
Projections 2013
High Economic Growth
Reference
Low Economic Growth
Benposium2015, Energy exports June 9, 2015
0
3
6
9
12
2005 2010 2015 2020 2025 2030 2035 2040
Future domestic natural gas prices depend on both domestic resource availability and world energy prices
32
average Henry Hub spot prices for natural gas 2013 dollars per million Btu
Source: EIA, Annual Energy Outlook 2015
History Projections 2013
High Oil Price
Reference
High Oil and Gas Resource
Low Oil Price
Benposium2015, Energy exports June 9, 2015
60
70
80
90
100
110
120
1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040
Growth in U.S. energy production outstrips consumption leading to a balance in United States energy imports and exports
33
U.S. energy production and consumption quadrillion Btu
Source: EIA, Annual Energy Outlook 2015 Reference case
History Projections 2013
-1% Consumption
Production
13%
2020 2040
Net imports
Benposium2015, Energy exports June 9, 2015
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