europelpgreport-sample02082013

Brent ended a tad lower after U.S jobs data disappointed the market. The hiring pace slowed in July, with the number of jobs increasing by 162,000, the Labor Department said. This was the smallest monthly gain since March, although the unemployment rate still fell to a four and a half year low of 7.4%. By 4.30pm UK time, September Brent was $108.84/bbl, down 24 cents from the same time the previous day.

In northwest Europe, the propane spot market was softer after a week of sideway movements, with supply looking more abundant and weaker signals coming from the Far East. This week’s spot trade culminated in two deals by mid-week, with delivery periods largely falling into the second August decade. Friday’s session saw the re-appearance of a French oil major offering a 18-22 August stem at $825/t, while a trading house bid for a marginally prompt 11-16 August cargo at $819/t and August flat. August swaps traded in the 4:00-4:30 BST time bracket on the central electronic trading platform in small volumes at $819/t on average, down $10/t from Thursday, thus limiting crude price-driven advances for the entire week to $12/t. Physical spot prices were down $1.5/t on the week at $823.5/t, while the premium to front month swaps narrowed to $4.5/t. The structure continued to flatten at the front with the perception of supply tightness easing. August/September closed the week at +$11/t versus +$21/t a week ago. A lack of momentum on the Asian market squeezed the East/West spread by $10/t to +$58/t. While propane’s discount to naphtha kept largely steady week-on-week – at -$68/t for August – it had relapsed from its intra-week high of -$53/t. Petrochemical sources reported favourable cracking economics for light feedstock in the light of poor crude C4 margins, whereas inland distribution demand was gauged as low.

AUGUST PROPANE MARKET SHOWS SIGNS OF EASING

(Continued on Page 3)

Table of ContentsOPIS LPG Full Day Prices

OPIS LPG Mont Belvieu Snapshot

OPIS Monthly Prices

OPIS Freight Rates & Netbacks

OPIS NWE Propane Forward Prices

OPIS Global Forward Prices

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p. 2

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p. 3

Brent Crude Oil ($/bbl)Month Price Change

SEP 108.84 -0.24OCT 108.00 -0.21NOV 107.34 -0.18

WTI Crude Oil ($/bbl)Month Price Change

SEP 106.94 -0.95OCT 106.24 -0.69NOV 104.76 -0.56

ICE Brent Futures at 16:30

Energy Futures at Settlement

2 August 2013

OPIS LPG Settle Prices ($/mt)

OPIS LPG Mont Belvieu Snapshot ($/mt)

LocationPropane cif ARA (ToT Cargoes)Butane cif ARA (+4,000mt)

Low821.50842.50

High825.50846.50

Mean823.50844.50

Change MTD Avg-10.00 828.500-1.00 845.000

Propane FOB MedButane FOB Med

843.00788.00

847.00792.00

845.00790.00

-5.00 847.5000.00 790.000

LocationMont Belvieu Non-TET PropaneMont Belvieu Non-TET Butane

Mean506.67602.49

Change MTD Avg+1.30 506.021-1.70 603.339

OPIS cif ARA Propane Swaps ($/mt)

+4.50 0.00Balance August 4:00-4:30pm

Mean Change819.00 -10.00

Physical-Paper Differential

OPIS Spot Prices ($/mt)

(c)Copyright by Oil Price Information Service (OPIS), a division of UCG. Reproduction of this report without permission is prohibited. Europe LPG Report is published each business day. OPIS does not guarantee the accuracy of these prices. Pricing/Editorial Office: 800-275-0950. For a limited copyright waiver, call (888)301-2645.

OPIS Global Prices ($/mt) Propane ButaneDate

CIF ARA 2-Aug-2013Price Change

823.50 -10.00Price Change

844.50 -1.00CFR Japan 2-Aug-2013Mont Belvieu Non-TET 1-Aug-2013FOB Arab Gulf 2-Aug-2013

875.50 -4.00503.42 +11.07817.00 +2.00

877.50 -4.00602.49 +17.55819.00 +2.00

OPIS 44,000mt Freight Rates ($/mt)Route Rate Change NWE C3

NetbackNWE C4 Netback

AG - Japan 75.00 +3.00 - -ALG - NWE 35.00 +1.50 788.50 809.50WAF - NWE 53.00 +2.00 770.50 791.50AG - NWE 100.50 +3.00 723.00 744.00USGC - NWE 63.00 +2.50 760.50 781.50

OPIS End of Day NWE Forwards Prices ($/mt)Month Min Max Mean Change Time Spread Pro/Nap Naphtha ChangeAUG 2013 819.00 823.00 821.00 -5.00 +13.00 -68.00 889.00 -1.00SEP 2013 806.00 810.00 808.00 -3.00 +11.00 -78.00 886.00 0.00OCT 2013 795.00 799.00 797.00 -3.00 +3.00 -84.00 881.00 -1.00NOV 2013 792.00 796.00 794.00 -3.00 +1.00 -81.00 875.00 -2.00DEC 2013 791.00 795.00 793.00 -2.00 +7.00 -77.00 870.00 -2.00JAN 2014 784.00 788.00 786.00 -2.00 +9.00 -79.00 865.00 -2.00FEB 2014 775.00 779.00 777.00 -2.00 +47.00 -82.00 859.00 -2.00MAR 2014 728.00 732.00 730.00 -2.00 +44.00 -122.00 852.00 -2.00APR 2014 684.00 688.00 686.00 -2.00 +9.00 -159.00 845.00 -2.00MAY 2014 675.00 679.00 677.00 -1.00 +4.00 -160.00 837.00 -2.00JUN 2014 671.00 675.00 673.00 -2.00 -1.00 -157.00 830.00 -2.00JUL 2014 672.00 676.00 674.00 -1.00 -- -- -150.00 824.00 -2.00Q3 2013 813.00 817.00 815.00 -4.00 +20.00 -73.00 888.00 0.00Q4 2013 793.00 797.00 795.00 -2.00 +31.00 -80.00 875.00 -2.00Q1 2014 762.00 766.00 764.00 -2.00 +85.00 -95.00 859.00 -2.00Q2 2014 677.00 681.00 679.00 -1.00 -- -- -158.00 837.00 -2.00

Propane

OPIS 6-Month Forward Curve ($/mt)

Propane/Naphtha

August Posted Prices ($/mt) Propane Butane

Saudi Arabia FOBAlgeria FOBNorth Sea

Price Change820.00 +25.00805.00 +60.00801.50 +53.50

Price Change820.00 +30.00810.00 +40.00798.50 +41.50

Global LPG Prices

of 5 © Oil Price Information Service, publishers of the OPIS/STALSBY Petroleum Supply Europe Directory www.opisnet.com

OPIS Europe LPG Report 2 August 2013

OPIS Global Propane Forward Prices ($/mt)

OPIS 6-Month Forward Curve ($/mt)

Arb East / West

(Continued from Page 1)Friday's offer coincided with the VLGC Morston ex-Houston showing destination Flushing for a 16 August arrival. A ToT parcel was possibly sold from the cargo for 15-19 August delivery basis Flushing earlier this week. Further West African arrivals also looked possible. There was talk that an international trader with term commitments in the Mediterranean area may have sold a WAF-origin part cargo to a European trading firm. The unconfirmed deal was linked to a late July lifting from the Bioko Island in the Gulf of Guinea onto the 78,550 cbm BW Denise. A potential second deal concerning a lifting from the 78,000 cbm FPSO at N'Kossa off the Congolese coast also surfaced, but could not be substantiated. The 59,343 cbm BW Nantes was on en route to N'Kossa, according to shipping data. Market participants were still awaiting the outcome of a sales tender, under which a 44kt stem (3:1) loading 9-15 September on a FOB basis at the Oso Bonny River Terminal (BRT) was offered. The tender closed Friday. Meanwhile, the first LPG lifting from Angola LNG’s new 5.2 million mt/year processing facility at Soyo is now expected in September, a trader said. The first LNG cargo was shipped to Brazil last month. In the Baltic region, Russian shipping company Sovcomflot(Continued on Page 4)

Global Swaps

MonthAUG 2013 SEP 2013 OCT 2013 NOV 2013 DEC 2013 JAN 2014 FEB 2014 MAR 2014 APR 2014 MAY 2014 JUN 2014 JUL 2014 Q3 2013 Q4 2013 Q1 2014 Q2 2014

Belv. Change Arb503.00 +4.00 -318.00507.00 +4.00 -301.00508.00 +3.00 -289.00510.00 +4.00 -284.00511.00 +4.00 -282.00515.00 +4.00 -271.00511.00 +4.00 -266.00490.00 +3.00 -240.00477.00 +3.00 -209.00474.00 +2.00 -203.00474.00 +2.00 -199.00477.00 +2.00 -197.00505.00 +4.00 -310.00510.00 +4.00 -285.00505.00 +3.00 -259.00475.00 +2.00 -204.00

FEI Change E/W879.00 -6.00 +58.00875.00 -6.00 +67.00876.00 -4.00 +79.00877.00 -4.00 +83.00879.00 -2.00 +86.00872.00 -2.00 +86.00860.00 -2.00 +83.00813.00 -2.00 +83.00771.00 -2.00 +85.00762.00 -1.00 +85.00758.00 0.00 +85.00760.00 +2.00 +86.00877.00 -6.00 +62.00877.00 -4.00 +82.00848.00 -2.00 +84.00764.00 -1.00 +85.00



reportedly took delivery of the first of two newly built LPG carriers – the 20,600 cbm Sibur Vorovezh -- in late July from a South Korean shipyard. The ice-class carrier has been chartered by Russian Sibur for a period of at least ten years, to ship cargoes from the new transhipment terminal at Ust-Luga in the Gulf of Finland, but the company declined comment on when the charter is due to begin. The 11,000 cbm pressurized ship Knebworth recently carried a parcel from Ust-Luga to Terneuzen, which was heard to have consisted of propane.

U.S. SHALE PLAYS OFFSET NORTH SEA DROP TO BOOST CONOCOPHILLIPS 2Q PRODUCTION U.S. oil major ConocoPhillips highlighted a strong second quarter production performance on the back of thriving U.S. shale developments, and is on track for a rise in annual output this year. Conoco's production for the second quarter was 1,510 mboe/d, compared with 1,489 mboe/d for 2Q 2012. Standing out was Eagle Ford production in Texas, up 98% from the second quarter last year to 121 mboe/d. Liquids-rich plays in Eagle Ford, Bakken and the Permian basin, delivered 47% growth at 203 mboe/d for the quarter. Production in North America continues to shift from natural gas to liquids, with liquids production up 17% this quarter from last year -- now accounting for almost half of production in the region. However, in the North Sea, second quarter production dropped 63 mboe/d to 173 mboe/d from the same time a year ago. The decline was said to be mostly due to downtime, with major turnarounds at the J-Block and Ekofisk completed over the quarter, and Eldfisk ahead of schedule in July. Conoco's second quarter earnings were $2.1 billion, down $200 million from the same time last year, although adjusted earnings -- excluding special items -- were up $250 million to $1.75 billion. Looking ahead, although output was expected to drop in the third quarter from planned downtime and turnaround activity, Conoco has raised their full-year production guidance to the range of 1,540-1,570 mboe/d. Conoco said North Sea projects at Jasmine in the J-Block area and Ekofisk South remain on schedule to start up in the fourth quarter this year for delivery into Teesside terminal. In Canada, first production from the Christina Lake Phase E started in July, with production expected to ramp up over the next six to nine months. Also expected to start up in late 2013 are the Malaysian projects Gumusut field Floating Production System (FPS) and Siakap North-Petai. Conoco's operations related to Kashagan in Kazakhstan, Algeria and Nigeria were reported as discontinued operations. The company has announced plans to sell their interests in these regions by the end of the year for approximately $9 billion in total.

PHILLIPS 66 SUBMITS PERMIT APPLICATIONS FOR NEW USGC LPG TERMINAL Phillips 66 has submitted permit applications with relevant regulatory agencies for its plans to build a new import/export terminal along the Old Brazos River in Texas, a company spokesman said. The facility would handle clean products and LPG. "Applications for the appropriate permits have been submitted, but as I'm sure you are aware most of these take many months for approval," the spokesman said in an e-mail

(Continued from Page 3)

(Continued on Page 5)

OPIS Europe LPG Report MethodologyOPIS assesses daily spot propane and butane prices at the key trading hubs in northwest Europe and the Mediterranean. Editors record and confirm deals, bids and offers, analyse supply and demand fundamentals, and gauge market sentiment and outlook. Prices are quoted in US dollars per metric ton. Times quoted are that of the United Kingdom.

In the northwest Europe propane market, OPIS assesses cargoes basis cif Flushing for 10-20 days forward. The quantity, grade and quality, delivery and nomination terms are as per the TOT contract for the current year. For further details, see http://opisnet.com/methodology.asp#neweuropelpg

Butane prices are for field grade mixed butane cargoes above 4,000mt delivered 5-20 days forward basis cif ARA.

In the Mediterranean, OPIS assesses field grade and refinery grade propane and butane fob basis Lavera 5-15 days forward. Cargo sizes are 1,500mt and above.

OPIS Europe LPG Editorial Staff

Karen Tang (London, UK) Diane Miller (NJ, USA)[email protected] [email protected]+44 779 415 0133 +1 732 730 2530Yahoo: kailin_tang Yahoo: dmiller_opis

Dermot McGowan (London, UK) Inge Erhard (London, UK)[email protected] [email protected]+44 752 522 5300 +44 777 375 7940Yahoo: dermotmcgowan Yahoo: ingepopfi

Jessica Nesterak (MD, USA) Mike Angell (NY, USA)[email protected] [email protected]+1 301 287 2721 +1 646 476 4180Yahoo: jessica_opis Yahoo: angell_m

Ronald Kwan (Singapore) David Wang (Singapore)[email protected] [email protected]+65 6337 3519 +65 6337 3519Yahoo: ronaldkwan1 Yahoo: david.opis



(Continued from page 4)

earlier this week. Phillips 66 first made light of the project in an earnings call in early May. The spokesman said there were no changes to dimensions of this project. If approved, construction is expected to begin in late 2014 with completion expected in mid to late 2016. LPG would be supplied by a proposed new NGL fractionator to be located close to the Sweeny refinery. Clean products would potentially be supplied from the refinery to the terminal.

BP OFFLOADS PORTUGUESE LPG BUSINESS FOR 115 MILLION EUROS TO RUBIS BP has sold its 170,000-ton LPG distribution business in Portugal to French infrastructure group Rubis for an agreed purchase price of 115 million euros. The two companies signed an agreement on Thursday, Rubis announced, with completion scheduled to take place in the first half of 2014. Rubis will have access through a joint venture to 65,000 cubic meters of storage capacity in Portugal for a market structurally dependent on imports. BP holds a 35% share in the Sigas storage facility in Sines, with Galp Energia (60%) and Repsol (5%) the other stakeholders. The Portuguese LPG market was said to be "particularly resilient" to the country's economic difficulties, and has growth potential amid a slowdown in the expansion of the natural gas network and the increased competitiveness of LPG compared to other fuels. The deal will represent Rubis' largest single market in Europe. Rubis' commercial LPG distribution brand, Vitogaz, operates in countries including France, Germany, Spain and Morocco.

CORRECTION:

For the OPIS Europe LPG Report on August 1, 2013, the correct quarterly values for OPIS End of Day NWE Forward Prices and OPIS Global Propane Forward prices are shown below. If you have any questions please contact Karen Tang on +44 7794150133 or [email protected]. We apologize for any inconvenience this may have caused.

Pro/Nap: Q4 –80.00, Q1 –95.00, Q2 –159.00

Naphtha: Q4 877.00 (+19.00), Q1 861.00 (+17.00), Q2 839.00 (+16.00)

Arb: Q4 –291.00, Q1 –264.00, Q2 –207.00

Belv: Q4 506.00 (+14.00), Q1 502.00 (+14.00), Q2 473.00 (+14.00)

E/W Q4 +84.00, Q1 +84.00, Q2 +85.00

FEI Q4 881.00 (+12.00), Q1 850.00 (+13.00), Q2 765.00 (+14.00)



europelpgreport-sample02082013

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