Russia’s state-controlled Gazprom has exported its first ever rail cargo of LPG to China at the Manzhouli border crossing. The company shipped 620t of propane-butane mix to trading firm Avestra Chemical earlier this month. It becomes only the third Russian company to export LPG by rail to China, after Irkutsk Oil and Omsk Kauchuk began shipments earlier this year.
The LPG was produced at Gazprom’s condensation stabilisation facility in Surgut, but future exports to China will come from its under-construction Amur gas processing plant. This is scheduled to start up in 2021 and will initially have an LPG production capacity of 500,000 t/yr, rising to 1.5mn t/yr by 2025.
“We are actively pursuing the marketing strategy for products from [Amur] and testing new logistics. This will enable us to start exports from the plant as soon as possible after its launch,” Gazprom export general director Elena Burmistrova says.
Irkutsk Oil was the first company to export LPG by rail to China, shipping around 8,000t in August October, while Omsk Kauchuk sent about 2,500t of butane in October. The 1.8mn t/yr Manzhouli Far East Gas LPG and propylene terminal opened in May 2018, but permitting issues delayed the start of Russian exports.
The primary shareholders in the Manzhouli terminal are St Petersburg-based Avestra and Chinese state-owned railway company CR Harbin. Avestra is negotiating LPG supplies with Gazprom, state-controlled oil producer Rosneft and other Russian companies.
Border appeal
China plans to import more LPG from Russia as it looks to diversify away from its dependence on Mideast Gulf and US imports — the latter of which are restricted by import tariffs as part of the US-China trade conflict. The Manzhouli terminal has a combined LPG and propylene storage capacity of 20,000m³ (11,800t). The terminal owners plan to develop the second phase in 2021-22, expanding its export capacity by 1.2mn t/yr to 3mn t/yr. Gazprom successfully shipped a 111t test cargoof LPG by rail to China from the Ussuriysk terminal in Russia’s far east in August.
Source:Argus
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