EIA: ethane consumption continues to grow

Annual US ethane consumption has increased every year since 2010 because demand for ethane as a petrochemical feedstock has grown. Ethane mainly serves as a petrochemical feedstock to produce ethylene, which is used to make plastics and resins.

Domestic ethane consumption over the past two years has increased due to increased ethylene cracking capacity. In contrast, consumption of most other petroleum products has decreased these past two years as a result of less travel during the COVID-19 pandemic.

US ethane consumption grew in 2021 despite the mid-February winter storm on the US Gulf Coast, which took more than one-third of US ethylene cracking capacity offline. Because about 90% of US ethane consumption is concentrated along the Gulf Coast, storm disruptions reduced its consumption by 655 000 bpd in February 2021. Despite this drop, the additional capacity from two new ethylene crackers during 2H21 contributed to an overall increase in ethane consumption in 2021.

The EIA expects US ethane consumption to average 2.1 million bpd in both 2022 and 2023 because another ethylene cracker was recently completed in Monaca, Pennsylvania, which will add an estimated 96 000 bpd of ethane feedstock capacity, and because it is expected that existing ethylene crackers will operate at higher utilisation rates.

In the US, cracking ethane has a higher profit margin than cracking naphtha to produce ethylene, a key component needed to produce many resins and plastics. Ethane’s relatively low cost and high ethylene yield have spurred growth in ethane use as an ethylene feedstock in the US and, increasingly, around the world. Although naphtha cracking can yield valuable co-products such as propylene, butadiene, benzene, toluene, and xylene, demand for ethylene has been outpacing demand for those co-products of naphtha cracking.

Read the article online at: https://www.hydrocarbonengineering.com/petrochemicals/06042022/eia-ethane-consumption-continues-to-grow/