Argus NGL Americasinfo.argusmedia.com/uslib/Argus NGL Americas (2015-09-02).pdf · Argus NGL Americas Issue 15-169 | Wednesday 2 September 2015 overview Spot market trade rangeS mont

Copyright © 2015 Argus Media Ltd

Argus NGL Americas

Issue 15-169 | Wednesday 2 September 2015

Spot market trade rangeSoverview

mont Belvieu ¢/USGmonth Low High mean vwa

E/P mix Enterprise Wet 16.750 17.250 17.000

Sep 16.750 17.250 17.000 17.000

Oct 16.875 17.375 17.125

Ethane Enterprise Wet 18.250 18.750 18.500

Sep 18.250 18.625 18.438 18.486

Oct 18.375 18.875 18.625

Ethane Targa Wet 18.625 19.125 18.875

Sep 18.625 19.125 18.875 18.875

Oct 18.750 19.250 19.000

Propane LST Wet 42.375 42.875 42.625

Sep 41.500 43.750 42.625 42.676

Oct 42.875 43.375 43.125

Propane Enterprise Wet 42.125 42.625 42.375

Sep 41.500 43.250 42.375 42.300

Oct 42.625 43.125 42.875

Propane Targa Wet 42.375 42.875 42.625

Sep 41.750 43.625 42.688 42.750

Oct 42.875 43.375 43.125

Refinery grade butane LST Wet 53.625 54.125 53.875

Sep 53.625 54.125 53.875 53.875

Oct 54.000 54.500 54.250

Normal butane Enterprise Wet 54.500 55.000 54.750

Sep 54.000 55.500 54.750 54.764

Oct 54.875 55.375 55.125

Isobutane LST Wet 55.375 55.875 55.625

Sep 55.375 55.875 55.625 55.625

Oct 55.750 56.250 56.000

Isobutane Enterprise Wet 53.500 54.000 53.750

Sep 52.250 55.250 53.750 54.979

Oct 53.875 54.375 54.125

Natural gasoline Enterprise Wet 93.750 94.250 94.000

Sep 91.500 96.500 94.000 95.511

Oct 94.125 94.625 94.375

Natural gasoline LST Wet 94.250 94.750 94.500

Sep 94.250 94.750 94.500 94.500

Oct 94.625 95.125 94.875

Natural gasoline Targa Wet 93.875 94.375 94.125

Sep 93.875 94.375 94.125 94.125

Oct 94.250 94.750 94.500

Spreads ¢/USGmonth vwa vwa mtd

Quality spreads: Enterprise

EP mix/purity ethane Sep -1.500 -1.500

Isobutane/butane Sep 0.000 -0.021

Locational spreads: Propane

LST/Enterprise Sep 0.050 0.025

Targa/LST Sep 0.000 0.000

Targa/Enterprise Sep 0.000 0.125

Conway/LST Sep -4.250 -4.344

Conway/Enterprise Sep -3.938 -4.156

Locational spreads: Natural gasoline

LST/Enterprise Sep 0.500 0.500

Targa/Enterprise Sep 0.125 0.125

See spread methodology at end of report

� Mont Belvieu, Texas, propane rose modestly in volatile trading amid heavy activity at the LST terminal, which saw more than 400,000 bl transacted. Ethane remained little changed.

� Heavy end NGLs at Mont Belvieu were little changed. Butane was range-bound to the previous day’s traded range, while natural gasoline fell slightly.

� Conway, Kansas, propane firmed in volatile trading. Heavy NGLs rose in thin trading in the midcontinent.

� Enterprise Products Partners completed the second seg-ment on the Aegis ethane pipeline system.

� Nationwide propane inventories rose by a smaller than ex-pected 620,000 bl for the week that ended 28 August, accord-ing to the Energy Information Administration's (EIA) weekly inventory report.

Licensed to: Cortney Becker, Argus Media Inc (New York)


Issue 15-169 | Wednesday 2 September 2015Argus NGL Americas

Page 2 of 12

Mont Belvieu light ngls spot Market trade ranges

Current month-to-date averages, sep ¢/USGMean Mtd vWa Mtd

Mont Belvieu

E/P mix Enterprise 17.125 17.125

Ethane Enterprise 18.563 18.590

Ethane Targa 19.000 19.000

Isobutane LST 56.000 53.000

Isobutane Enterprise 54.125 54.802

Natural gasoline Enterprise 94.125 94.704

Natural gasoline LST 94.625 94.625

Natural gasoline Targa 94.250 94.250

Propane LST 42.375 42.443

Propane Enterprise 42.313 42.162

Propane Targa 42.406 42.459

Butane LST 53.813 53.813

Butane Enterprise 54.688 54.786

Conway

E/P mix 15.625 15.625

Propane 37.938 37.885

Butane 45.188 45.500

Isobutane 58.938 58.938

Natural gasoline 96.625 96.639

Rail natural gasoline 100.125 na

Conway ¢/USG

Month low high Mean vWa

E/P mix Wet 15.625 16.125 15.875

Sep 15.500 16.250 15.875 15.875

Oct 15.625 16.125 15.875

Propane Wet 38.125 38.625 38.375

Sep 37.000 39.750 38.375 38.216

Oct 40.125 40.625 40.375

Normal butane Wet 45.500 46.000 45.750

Sep 45.500 47.500 46.500 46.500

Oct 48.250 48.750 48.500

Isobutane Wet 58.125 58.625 58.375

Sep 59.000 59.250 59.125 59.125

Oct 60.875 61.375 61.125

Natural gasoline Wet 97.000 97.500 97.250

Sep 96.750 97.250 97.000 97.000

Oct 95.375 95.875 95.625

Rail natural gasoline Sep 99.500 101.500 100.500

hattiesburg ¢/USG

Month low high Mean Mean Mtd

Propane Sep 43.125 44.125 43.625 43.375

Bushton ¢/USG


Propane Sep 37.625 38.125 37.875 37.438

napoleonville ¢/USG


E/P Mix Sep 15.250 15.750 15.500 15.625

Ethane Sep 17.188 17.688 17.438 17.563

Propane Sep 40.125 40.625 40.375 40.313

Normal butane Sep 51.125 51.625 51.375 51.313

Isobutane Sep 64.250 64.750 64.500 64.875

Natural gasoline Sep 99.000 99.500 99.250 99.375

Mont Belvieu, Texas, propane rose in volatile trading Wednes-day after the Energy Information Administration (EIA) reported a smaller than expected 4,000 bl build in PADD III inventories and a nationwide build of 620,000 bl.

LST propane strengthened in heavy trading Wednesday, with 430,000 bl transacted at that terminal. LST opened in line with the prior day's range, at 42.25¢/USG, and fell as low as 41.5¢/USG after the release of the EIA’s data, amid over-whelming declines in crude. Propane rebounded with WTI mid-day, trading as high as 43.75¢/USG during the afternoon.

LST propane was last talked at 39.5pc of WTI, stronger session-on-session.

EPC propane saw thin liquidity, with only about 75,000 bl traded between 41.5-43.25¢/USG. It opened at 42.5¢/USG, rose with crude, and then sank to 41.5¢/USG by day's end as traders exited the market early.

Location spreads between the LST and EPC terminal priced the latter anywhere from a 0.25¢ premium to a 0.25¢ discount.

Targa propane traded between 41.75-43.625¢/USG. Spreads with the LST and EPC terminals priced Targa propane at par-ity.

Ethane fell slightly, mirroring movements seen in natural

us gulf coast export

low high Mean

Propane fob ¢/USG 55.175 55.425 55.300

Propane fob $/t 288.18 289.48 288.83

US propane del Japan (AUSJ) $/t 434.0 435.5

US propane del ARA (AUSE) $/t 357.0 358.5




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NGL spot dealsTiming ¢/USG bl

Butane Conway Sep 45.500 5,000Sep 47.500 5,000Sep/Oct -2.000 20,000

Butane EPC Sep 54.000 10,000Sep 54.000 10,000Sep 54.000 10,000Sep 54.500 10,000Sep 55.000 10,000Sep 55.250 10,000Sep 55.250 10,000Sep 55.375 10,000Sep 55.500 10,000

E/P mix Conway Sep 15.500 5,000Sep 15.750 5,000Sep 16.000 5,000Sep 16.250 5,000

Ethane EPC Sep 18.250 10,000Sep 18.375 5,000Sep 18.500 10,000Sep 18.500 10,000Sep 18.500 10,000Sep 18.500 10,000Sep 18.500 10,000Sep 18.500 10,000Sep 18.625 15,000

Isobutane Conway Sep 59.000 2,500Sep 59.250 2,500

Isobutane EPC Sep 52.250 10,000Sep 55.000 10,000Sep 55.250 100,000

Isobutane EPC/Butane EPC Sep 0.000 10,000Natural gasoline Conway Sep 97.000 2,500

Sep 97.000 2,500Natural gasoline EPC Sep 91.500 15,000

Sep 93.750 25,000Sep 93.750 20,000Sep 94.000 10,000Sep 94.500 10,000Sep 94.750 5,000Sep 95.000 10,000Sep 95.000 10,000Sep 96.250 25,000Sep 96.250 25,000Sep 96.250 25,000Sep 96.250 25,000Sep 96.250 25,000Sep 96.250 25,000Sep 96.250 25,000Sep 96.500 25,000Sep 96.500 25,000

Propane Conway Sep 37.000 5,000Sep 37.500 5,000Sep 37.500 5,000Sep 37.500 5,000Sep 37.500 5,000Sep 38.000 5,000Sep 38.500 5,000Sep 38.750 5,000Sep 38.875 5,000Sep 39.500 5,000

NGL fractionation spreads¢/USG $/mmBtu

Gulf, Mont Belvieu

Ethane Enterprise 1.636 1.211


Normal butane Enterprise 27.155 0.369



Total barrel value 4.560

Total barrel frac spread 1.900

Midcontinent, Conway

Ethane-propane mix -0.831 1.039

Propane 14.248 1.174

Normal butane 18.415 0.309

Iso-butane 32.122 0.586

Natural gasoline 68.036 1.184

Total barrel value 4.292

Total barrel frac spread 1.657

gas. It opened at 18.5¢/USG and traded on either side of that level throughout the day.

Targa ethane and E/P mix were illiquid on Wednesday. Nymex light, sweet October futures settled higher by 84¢/

bl to $46.25/bl. Nymex October RBOB settled higher by 2.96¢/USG at $1.4252/USG, while Henry Hub natural gas weakened by 5.4/mnBtu ending at $2.638mnBtu.

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Enterprise propane vs butane ¢/USG




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Sep 39.750 5,000Apr-Jun 40.000 3,000

Propane EPC Sep 41.500 10,000Sep 42.000 25,000Sep 42.500 10,000Sep 42.500 10,000Sep 42.500 10,000Sep 43.250 10,000Sep/Oct -0.500 10,000

Propane LST Sep 41.500 10,000Sep 41.625 15,000Sep 41.750 10,000Sep 42.000 20,000Sep 42.125 10,000Sep 42.250 15,000Sep 42.250 10,000Sep 42.250 10,000Sep 42.375 10,000Sep 42.375 10,000Sep 42.375 10,000Sep 42.375 10,000Sep 42.375 10,000Sep 42.375 10,000Sep 42.500 25,000Sep 42.500 15,000Sep 42.500 10,000Sep 42.500 10,000Sep 42.500 10,000Sep 42.500 10,000Sep 42.625 10,000Sep 42.750 10,000



Sep 42.750 10,000Sep 42.750 10,000Sep 43.000 10,000Sep 43.000 10,000Sep 43.000 10,000Sep 43.125 10,000Sep 43.250 10,000Sep 43.250 10,000Sep 43.250 10,000Sep 43.250 10,000Sep 43.500 10,000Sep 43.500 10,000Sep 43.500 10,000Sep 43.500 10,000Sep 43.625 10,000Sep 43.750 10,000Sep 43.750 10,000Sep/Oct -0.625 50,000Sep/Oct -0.500 100,000

Propane LST/EPC Sep -0.250 10,000Sep 0.000 10,000Sep 0.000 10,000Sep 0.250 10,000Sep 0.250 10,000

Propane Targa Sep 41.750 10,000Sep 42.625 10,000Sep 43.000 10,000Sep 43.625 10,000

Propane Targa/EPC Sep 0.000 10,000Propane Targa/Propane LST Sep 0.000 10,000

Sep 0.000 10,000

Assessment rationaleA minimum of two Mont Belvieu EPC propane deals matching volume requirements set forth by Argus methodology were val-idated and the low/high range for the day was assessed based on those values. The minimum aggregate volume of deals was also met to calculate the volume weighted average for the Mont Belvieu EPC propane current any month assessments.

A minimum of two Mont Belvieu LST propane deals match-ing volume requirements set forth by Argus methodology were validated and the low/high range for the day was assessed based on those values. The minimum aggregate volume of deals was also met to calculate the volume weighted average for the Mont Belvieu LST propane current any month assess-ments.

MoNT BeLvieu HeAvy NGLs

Mont Belvieu, Texas, heavy NGLs held steady in choppy trading alongside the rest of the energy complex. EPC butane rose

slightly and EPC natural gasoline ended modestly lower than the prior day's midpoint.

EPC natural gasoline was quiet during the first half of the session as market participants monitored volatility in crude. September opened lower, at 91.5¢/USG, but bids rose midday alongside the rebound in crude and gasoline.

Afternoon trading opened stronger at 94.5¢/USG, and rose as high as 96.5¢/USG.

Targa and LST natural gasoline were quiet on Wednesday. Targa continued to be discussed at a slight 0.125¢ premium to the EPC terminal, while LST natural gasoline held a roughly 0.125-0.75¢ premium to EPC.

EPC butane opened at 55.5¢/USG and sank to an early low of 55¢/USG. Butane followed the rebound in crude and RBOB, paring earlier losses to 55.375¢/USG in the afternoon.

Isobutane at the EPC terminal traded at parity with the EPC butane market, while outright volumes transacted be-tween 52.25-55.25¢/USG.




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Conway normal butane vs isobutane ¢/USG

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LST propane vs Conway propane ¢/USG

Assessment rationaleA minimum of two butane Mont Belvieu deals matching volume requirements set forth by Argus methodology were validated and the low/high range for the day was assessed based on those values. The minimum aggregate volume of deals was also met to calculate the volume weighted average for Mont Belvieu EPC butane current any month assessments.

Mont Belvieu LST refinery grade butane was assessed using a midpoint of 53.875¢/USG. The traded range was assessed by pricing LST butane’s midpoint at a 0.875¢ discount to EPC butane, unchanged from the previous session’s differential, and was used in the absence of outright trades. A polling of market participants did not yield any fresh price indications for the grade. The minimum aggregate volume traded did not meet the volume weighted average methodology.

ConwAy LighT ngLS

Conway, Kansas, propane firmed in choppy intraday trade on Wednesday after the Energy Information Administration (EIA) reported a smaller-than-expected 620,000 bl build in nation-wide inventories and a 433,000 bl build in PADD II stockpiles.

Conway propane was sold early for 37¢/USG and firmed to 38.5¢/USG immediately after the EIA released its stockpile data. Prices retreated to 37.5¢/USG midday alongside declines in US Gulf coast NGLs and crude.

Prices then rebounded in the afternoon amid gains crude and midcontinent propane was last traded at 39.75¢/USG.

Conway propane was last valued at 36.1pc of WTI, stronger session-on-session.

E/P mix traded between 15.5-16.25¢/USG early in the ses-sion, about 0.5¢ stronger than the previous session’s midpoint.

ConwAy heAvy ngLS

Conway, Kansas, heavy NGLs firmed in thin trading. Butane at the midcontinent started the session sold at

45.5¢/USG and firmed by midmorning to 47.5¢/USG. Traders exited the market thereafter and butane was last bid/offered at 47.5/51¢/USG.

A September/October butane spread traded at a 2¢ con-tango.

Isobutane traded early in the day in a range of 59-59.25¢/USG, firmer than the previous day’s midpoint of 58.75¢/USG. Like butane, isobutane was quiet for the remainder of the ses-sion and was last offered at 60¢/USG.

Natural gasoline at Conway was illiquid on Wednesday and was assessed slightly higher than Tuesday based on bids and offers and small-volume transactions.

CAnAdA

Trading in Edmonton was thin. Propane in the well continued to be valued at about a 22¢/USG discount to Conway however most observers reported that few if any transactions were get-ting done. Edmonton butane moved in lockstep with crude and was pegged at 47-48pc of the calendar month average of WTI.

No fresh Sarnia propane postings were reported, and Sarnia propane remained at 38.25-48.25¢/USG. Sarnia butane was pegged at a 5¢/USG premium to the US Gulf coast based on a




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Canada

Edmonton ¢/USGdaily Month Low High Mean Mean MTd

Propane Sep 15.750 19.750 17.750 16.625

Diff to Conway Sep -22.625 -18.625 -20.625 -21.313

Field grade butane Sep 52.750 53.875 53.312 52.813

Diff to LST Sep -1.125 +0.000 -0.562 -1.000

Can. condensate $/bl Oct 46.850 47.350 47.100

Diff to WTI $/bl Oct -0.250 +0.250 +0.000

Sarnia ¢/USGdaily Month Low High Mean Mean MTd

Propane Sep 38.250 48.250 43.250 43.250

Diff to LST Sep -4.375 +5.625 +0.625 +0.875

Butane Sep 57.875 59.875 58.875 56.313

Diff to LST Sep +4.000 +6.000 +5.000 +2.500

Isobutane Sep 48.625 50.625 49.625 +49.625

Diff to LST Sep -7.000 -5.000 -6.000 -6.375

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LST propane vs Enterprise propane ¢/USG

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Enterprise butane vs Conway butane ¢/USG

calculated netback from New York Harbor butane. Demand for butane for gasoline blending is set to pick up in mid-Septem-ber. No fresh isobutane activity was detected.

Edmonton condensate traded at parity with October CMA Nymex WTI, up from a discount of $0.75-$0.50/bl on Tuesday.

LaTin aMEriCa

Spot cargo discussions remained quiet Wednesday. Participants suggested traders may have so far managed to avoid more cancellations in October, but noted the arbitrage with north-west Europe remains shut with estimated spot freight between Houston and Flushing at $69/t or so, above the $43/t or so differential between the two regions. The US discount to Asia propane stands at roughly $146/t for a spot fob cargo, roughly in line with freight.

In Houston, participants puzzled over the modest 4,000 bl increase in PADD III inventories. While exports remain brisk, market fundamentals between the US and other regions is unchanged.

Observers noted an uptick in loadings of smaller handy-sized cargoes of mixed propane and butane in recent weeks, nearly all of it bound for the Caribbean or Central America, ahead of tropical storms in the region. In late August tropical storms swept across the Caribbean, resulting in power outages in the US Virgin Islands, the Dominican Republic, Haiti, and other islands. Buyers typically stock up on LPG supplies ahead of the storms.

Wednesday the VLGC Al Wukir left the Houston Ship Chan-nel bound for northwest Europe. The VLGC BW Borg and Gas-chem Hunter loaded at Enterprise’s terminal on the Houston

Ship Channel, and the Norgas Petaluma and Pgc Strident Force loaded at Targa. The VLGC Motivator left Houston en route to Honduras.

The Navigator Phoenix finished loading near Corpus Christi, Texas, and is bound for Aruba.

EuropE/aSia

northwest EuropeThe large cargo market was quiet again today on both grades with falling crude and paper levels drawing large cargo pro-pane levels lower.

An industry event kept many away from the desks, serving




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Ethylene cash margins ¢/lbMargins

Purity ethane 11.98

Propane Enterprise 5.23

Normal butane Enterprise 6.73

Light naphtha 8.29

Heating oil Colonial 31.86

Ice daily weighted averages ¢/USGTiming Averages

Mont Belvieu ethane Sep 18.480

Mont Belvieu propane Sep 42.560

Conway propane Sep 38.220

WTI comparisons: Percentage of crudeMont

Belvieu % Conway % Mont Belvieu / Conway spread %

Propane 38.5 34.8 +3.7

Propane LST 38.7 +3.9

Normal butane 49.7 42.2 +7.5

Isobutane 48.8 53.7 -4.9

Isobutane LST 50.5 -3.2

Natural gasoline 85.4 88.1 -2.7

Mont Belvieu grades are Enterprise except where noted

Argus extends and completessecond annual Iosco assurance reviewArgus has now completed its second external review of its oil price benchmarks, including those for LPG markets. The review was carried out by professional services firm PwC. An independent and external review of oil bench-mark prices is required on an annual basis by international regulators in order to satisfy Iosco’s Principles for Oil Price Reporting Agencies (the PRA Principles). For more infor-mation and to download the report visit our websitehttp://www.argusmedia.com/About-Argus/How-We-Work

to dampen an already lacklustre market. With several VLGCs still due into the region from around mid-month the market remains balanced for the time being, with no prompt demand or supply in evidence. Discounts to paper are anticipated as the US cargoes – at least four - begin to arrive, all of which are thought to be placed. Rumours of a cargo changing hands at a decent single figure discount to paper could not be firmed up, with no further details on the buyer, seller or delivery dates.

The large cargo butane market was quiet again after Dow's bid yesterday went unmet and it is not thought to have been covered in the meantime, or had any sellers come forward. Levels slid lower with naphtha falls.

Asia-Pacific Asian spot prices shed nearly all of the previous day's gains fol-lowing yet another round of dramatic crude movements. The October Argus Far East Index (AFEI) swaps fell $29/t day-on-day to settle at $402/t though the September AFEI swaps per-formed better at $405/t, widening the backwardation between the prompt AFEI timespread to +$3/t.

The bipolar streak suffered by the crude benchmarks failed to unhinge trading activity in the Asian market as the same number of buyers and sellers returned to the afternoon trad-ing window.

Two buyers re-surfaced with bids for 22,000t propane for first-half October arrival with the higher at the average of $400/t:Balance 2-30 September AFEI -$5/t which equated $400/t or October AFEI -$2/t. Three sellers emerged with counter-offers, the lowest offer being October AFEI -$1/t which was valued at $401/t. The narrow bid and offer range failed to render a trade at the close of Asian trade.

A US trader returned to bid for 22,000t propane for sec-ond-half October arrival at October AFEI -$5/t which equated $397/t.

While buying support of pure propane cargoes was evident, the same cannot be said of evenly-split cargoes arriving in first-half October basis Japan. A European major lowered its offer of 11,000t+11,000t for first-half October to October CP +$67/t from +$69/t the previous session. The offer was valued at $416/t with the October CP swaps assessed at $364/t.

Steady demand for 22,000t propane or 11,000t+11,000t car-goes for second-half September and first-half October arrival basis south China arrival continued to be underpinned by firm Chinese domestic wholesale prices.

11,000t+11,000t cargoes were valued at $414/t or October CP +65/t, depicting the average of propane and butane quotes, basis Japan and south China arrival.

RElATEd MARkETs

CrudeOil futures shrugged off bearish federal data to settle higher a day after an 8pc plunge. Nymex light, sweet October futures settled higher by 84¢/bl to $46.25/bl.

Ice October Brent settled higher by 94¢/bl to $50.50/bl. The Brent-WTI spread widened by 10¢/bl to $4.25/bl.

Permian grades WTI Midland and WTS continued to move




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Forward curves

Petrochemical feedstock comparisons¢/USG $/t

E/P mix 17.00 115.07

Purity ethane 18.44 137.06


Butane Enterprise 54.75 248.02



Paraffinic naphtha 80 min 105.53 407.95

Reformer naphtha 40 N+A 123.77 443.62

Diesel 10ppm Colonial 151.80 458.68

Heating oil Colonial 139.04 420.15

Mont Belvieu ¢/USGMonth Bid offer Mean

Ethane Sep 18.250 18.750 18.500

Oct 18.500 19.000 18.750

Nov 18.750 19.250 19.000

Dec 19.000 19.500 19.250

4Q15 18.750 19.250 19.000

1Q16 19.500 20.000 19.750

2Q16 19.000 19.500 19.250

Propane Sep 43.250 43.750 43.500

Oct 44.000 44.500 44.250

Nov 44.750 45.250 45.000

Dec 45.500 46.000 45.750

4Q15 44.750 45.250 45.000

1Q16 46.250 46.750 46.500

2Q16 45.500 46.000 45.750

Butane Sep 55.125 55.625 55.375

Oct 55.750 56.250 56.000

Nov 56.375 56.875 56.625

Dec 56.875 57.375 57.125

4Q15 56.375 56.875 56.625

1Q16 57.625 58.125 57.875

2Q16 56.125 56.625 56.375

conway ¢/USGMonth Bid offer Mean

Propane Sep 39.500 40.000 39.750

Oct 41.500 42.000 41.750

Nov 43.500 44.000 43.750

Dec 45.000 45.500 45.250

4Q15 43.375 43.875 43.625

1Q16 43.625 44.125 43.875

2Q16 39.750 40.250 40.000

US forward curve prices reflect the market at 1:30pm CT

Northwest europe ¢/USGMonth Mid

Propane Sep 57.000

Oct 57.875

Nov 59.125

Dec 60.500

Jan 61.125

Feb 59.375

4Q15 59.125

1Q16 59.375

2Q16 55.875

higher on Wednesday, both establishing a new high for the October trade month.

Phillips 66 fixed the 158,322t Densa Whale to ship crude 13 September from Basrah Oil Terminal to the US west coast.

Pluspetrol Norte SA issued two tenders offering to sell 200,000 bl of Peruvian heavy sour Loreto crude and 150,000 bl of similar Piraña Blend for loading 10-20 October.

In western Canada, Syncrude traded within a wide range as the duration of the outage at the company's 350,000 b/d Mildred Lake upgrader facility remained unclear.

GasolineGulf coast gasoline prices declined at mid-week as the region fully transitioned lower to 11.5 RVP grades with the start of Colonial Pipeline’s 51st cycle. However, a large draw on US Gulf coast gasoline inventories as reported by the US Energy Information Administration (EIA) provided a degree of support.

Fixed prices rose in the US midcontinent gasoline markets despite weaker regional differentials. The October Nymex RBOB contract settled higher by 2.96¢/USG and pulled prices up. Differentials weakened and prices rose as the Energy Information Administration (EIA) released the latest weekly update to its industry information. The data, covering the week ended 28 August, showed a 2.7pc increase in national gasoline supplied, a proxy for demand.

NaphthaHeavy and full range N+A naphtha differentials rose sharply Wednesday upon thriving demand and the gasoline market shift from summer to winter grade conventional grade gaso-line.

The Gulf coast waterborne conventional gasoline market moved from the 9 RVP M2 grade to the 11.5 RVP M3 grade on




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Argus Assessment Rationale DatabaseFor prices used in financial benchmarks, Argus publishes daily explanations of the assessment rationale with sup-porting data. This information is available to permissioned subscribers and other stakeholders.

Subscribers to this report via Argus Direct or MyArgus may access the database here.

Other subscribers may request access here or contact us by email at [email protected].

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Wednesday. M3 had been trading around a 2¢/USG discount to M2 earlier this week.

Trading ramped up after a cautious run up to this RVP tran-sition date. A standard 38 N+A, 110 IBP, 63 maximum API barge traded at Gulf coast waterborne conventional 11.5 RVP (GC WBM M3) -20¢/USG for 8-10 September delivery to Houston. This trade was done within a narrow afternoon trading window utilizing a non-Argus GC WBM M3 basis.

Heavy naphtha trades hovered at higher levels. A premium quality high N+A naphtha barge was heard traded at GC WBM M3 -18¢/USG, fob Gulf coast for a pump-over in the Houston area.

A barge of close to generic 40 N+A naphtha with 140 IBP and 60 API changed hands at GC WBM M3 -17¢/USG for delivery within the next 5 days. A major offered heavy N+A naphtha with typical 58-59 API as high as GC WBM M3 -13¢/USG, but there were no buyers at that level.

Meanwhile, full range N+A naphtha differentials ramped higher as well. Calcasieu-quality N+A naphtha with 105 IBP traded at GC WBM M3 -21.5¢/USG, delivered 8-10 September to Houston.

Light straight run (LSR) naphtha trades were difficult to detect Wednesday. Galveston Bay-quality sour LSR reportedly traded in the 5s¢/USG premium to natural gasoline (C5) on Tuesday. Values for the sour grade continued to be pegged around C5 5¢/USG to 6¢/USG levels, on a Gulf coast delivered basis on Wednesday.

Sweet LSR talk had been elusive the past few trading ses-sions. Market participants pegged the sweet grade at around

C5 +11¢/USG, in line with last-done business as well.

Natural gasUS natural gas futures ended lower today amid forecasts for mixed weather and expectations that a government report tomorrow will show a large injection into gas storage.

Spot prices retreated today, surrendering some weather-driven gains. Henry Hub prices fell by 2¢/mmBtu to an average of $2.725/mmBtu, while gas at Transco zone 6 in New York dropped by 4¢/mmBtu to $2.84/mmBtu.

Meteorologists with the private forecaster MDA Weather Services are predicting hotter-than-normal weather through next week that should boost demand for the power plant fuel to above normal seasonal levels. But that hot weather should fade across parts of the central and eastern US on 12-16 Sep-tember.

"The temperature outlook continues to fluctuate, but this morning's warmer forecast for next week looks to be offset by cooler readings in the week to follow," said Citi Futures Perspective analyst Tim Evans.

Meanwhile, market participants are awaiting tomorrow's release of fresh gas inventory data. The US Energy Information Administration (EIA) will probably report tomorrow that gas stockpiles in the week ended 28 August grew by 89 Bcf (2.5bn m³) as mild weather helped curb gas demand, according to the average of 12 analyst estimates in an Argus survey.

That consensus estimate compares with a five-year average injection for the week of 60 Bcf and a year-earlier build of 79 Bcf, the EIA said.




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Industry news

us propane stocks up by 620,000 bl: eIANationwide propane inventories rose by a smaller than ex-pected 620,000 bl for the week that ended 28 August, accord-ing to the Energy Information Administration’s (EIA) weekly inventory report.

Market observers on average were expecting a 1.44mn bl build in propane stockpiles, with forecasts calling for a build ranging between 1mn bl to 1.8mn bl.

At 96.344mn bl, US propane inventories stand about 46.29pc above the five-year average and 20.22mn bl above where inventories stood during the final week in August last year.

Stockpiles at the US Gulf coast surprised most market participants by rising by a slight 4,000 bl to total 60.688mn bl. Some attributed the small build to exports as loading times re-sumed last week at Nederland, Texas, after compressor issues had slowed down loadings at the terminal.

Others attributed the smaller build to the August ad va-lorem taxes, but the impact of the annual taxes was unclear.

Despite the smaller build, spot propane prices at Mont Bel-vieu, Texas, fell after the release of the EIA’s inventory report, likely borrowing much of the weakness from declines in the crude market.

LST propane reached a morning high of 43.5¢/USG, up 1.25¢ from where it opened the session, but sank down to 41.5¢/USG in trade following the EIA’s report.

EPC propane also fell to 41.5¢/USG, down from a morning high of 43.25¢/USG.

Propane stockpiles at the midcontinent rose by 433,000 bl to total 27.317mn bl.

Spot propane prices at Conway, Kansas, mirrored senti-ment seen at the US Gulf coast, showing earlier strength but ultimately falling after the EIA stocks report.

Conway propane was sold early for 38¢/USG, and rose to hit a high of 38.5¢/USG. In trade following the report, propane pared gains to 37.5¢/USG.

Along the Atlantic coast, propane stockpiles rose by 216,000 bl to total 4.530mn bl, while at the Rocky Mountains and west coast regions inventories fell by 34,000 bl to stand at 3.808mn bl.

US propylene at bulk terminals rose by 88,000 bl to 4.612mn bl, while propane/propylene supplied to end-users rose by 194,000 b/d to 1.117mn b/d.

Other NGL and olefin stocks, excluding propane and propyl-ene, rose to 127.4mn bl.

ePC completes second Aegis segmentEnterprise Products Partners completed the second segment on the Aegis ethane pipeline system.

The second segment of the line runs from Beaumont, Texas, to Lake Charles, Louisiana.

The final leg of the Aegis line will extend from Lake Charles to the Mississippi river and is expected to be completed by the end of 2015, according to the midstream company.

The Aegis pipeline is part of a greater 500-mile ethane header system running from Corpus Christi, Texas, to the Mis-sissippi river, intended to supply more than 20 petrochemical facilities.

The Aegis line is backed by more than 300,000 b/d of customer commitments and has the ability to be expanded to about 400,000 b/d with additional pumps.

Equistar’s La Porte unit briefly shut Equistar Chemicals’ La Porte, Texas, unit shut after high-pres-sure boiler pump turbines tripped and caused a lack of feed water to furnaces, the company said in a Texas Commission on Environmental Quality filing.

The event lasted from 1-2 September and resulted in flaring and excess emissions of benzene, ethylene, ethane,

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Page 11 of 12

methane, propane, propylene, butane and butadiene, among other materials.

US rail agency offers $10mn for projectsThe Federal Railroad Administration (FRA) is offering $10mn in competitive grants to states to improve highway-rail crossings and tracks that transport crude, ethanol and natural gas.

The agency said it is looking for “innovative solutions” to enhance the safety of hazardous chemical shipments, espe-cially at highway-rail crossings.

“The US Department of Transportation has made increasing safety at highway-rail grade crossings, especially along routes transporting energy products, one of its top priorities,” trans-portation secretary Anthony Foxx said. “This money allows the department to support innovative ideas and solutions devel-oped at the local level.”

Although railroad accidents have declined by 46pc in the last decade, and hazardous materials accidents by nearly 50pc, there is still room for improvement, FRA said.

Applicants requesting more than $3mn must describe why they need more than that amount, and projects can be sub-divided if they operate independently and offer discrete public

benefits. FRA also encourages applicants to apply for other federal, state, local or private funds.

Individual states, groups of states and interstate compacts are eligible to apply for the funding, and FRA prefers that state transportation departments submit applications.

“All eligible project types must be conducted on and directly relate to rail lines over which crude oil, ethanol, and/or natural gas are transported,” FRA said. “In addition, all ap-plications must clearly demonstrate project need and the ex-pected positive impact of the proposed project on rail safety using clear, supportable data.”

FRA funds can only be used for 80pc of the costs of a project, and at least 20pc must be provided for in a project match. Applicants must detail the source of any matching funds.

Rail-highway projects that will be considered include crossing approach improvements, crossing sign and paving im-provements, active warning devices, visibility improvements, crossing geometry improvements, elimination of crossings and other innovative safety enhancements.

Applications are due by 4 November at 5 pm. More infor-mation can be found at www.fra.dot.gov or by emailing [email protected].

AnnoUncementS

CORRECTION: Due a revision in an EPC propane deal reported on 31 August the following assessments changed:Effective 31 August Product Delivery Traded range VWA MTD VWA MTDEPC propane Aug NA 41.482¢/USG 37.319¢/USG NAUSGC export Aug 54.357-54.607¢/USG NA NA NAUS to Japan propane Aug $444/t-$445/t NA NA NAUS to Europe propane Aug $343/t-$344/t NA NA NA


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PublisherAdrian Binks

Chief executiveNeil Bradford

CEO AmericasEuan Craik

Global compliance officerJeffrey Amos

Commercial managerKaren Johnson

Editor in chiefIan Bourne

Managing editorJim Kennett

EditorAmy StrahanTel: +1 713 360 [email protected]

Customer support and salesTechnical [email protected] other queries [email protected], USTel: +1 713 968 0000New York. US Tel: +1 646 376 6130Washington DC, US Tel: + 1 202 775 0240London, UK Tel: +44 20 7780 4200Astana, Kazakhstan Tel: +7 7172 54 04 60Beijing Tel: +86 10 8535 7682Dubai Tel: +971 4434 5112Moscow, Russia Tel: +7 495 933 757Rio de Janeiro, BrazilTel: +55 21 2548 0817Singapore Tel: +65 6496 9966Tokyo, Japan Tel: +81 3 3561 1805

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Registered officeArgus House, 175 St John St, London, EC1V 4LW Tel: +44 20 7780 4200 Fax: +44 870 868 4338 email: [email protected]

ISSN: 1537-2200Copyright noticeCopyright © 2015 Argus Media Inc. All rights reserved. All intellectual property rights in this publication and the information published herein are the exclusive property of Argus and/or its licensors and may only be used under licence from Argus. Without limiting the foregoing, by reading this publication you agree that you will not copy or reproduce any part of its contents (including, but not limited to, single prices or any other individual items of data) in any form or for any purpose whatsoever without the prior written consent of Argus.

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DisclaimerThe data and other information published herein (the “Data”) are provided on an “as is” basis. Argus makes no warranties, express or implied, as to the accuracy, adequacy, timeliness, or completeness of the Data or fitness for any particular purpose. Argus shall not be liable for any loss or damage arising from any party’s reliance on the Data and disclaims any and all liability related to or arising out of use of the Data to the full extent permissible by law.

METHODOLOgY

Volume-weighted averagesArgus publishes current month volume-weighted averages of deals done at Mont Belvieu and Conway. These averages are provided as an additional tool for the industry to use for pur-poses of indexing transactions. The volume-weighted average methodology is used extensively for indexation in the natural gas, crude and clean products markets. The Argus averages are published as a single price, not as a range, to represent volume-weighted averages of the current month deals done throughout the entire trading day. Argus will only calculate volume-weighted averages where it has validated a minimum volume of trade for the term and location in question. For further details, see http://www.argusmedia.com/Methodology-and-Reference.

Spread methodologySpread assessments represent the traded spot market for spreads between two commodities. Spreads are expressed as x/y, where the buyer of the spread purchases commodity x and sells commodity y. Argus publishes both quality and loca-tional spreads. Spreads are not calculated, but represent bona fide trades done in the spot spread market.

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