U.S. ETHANE PRODUCTION ESTABLISHED A NEW RECORD IN APRILU.S. ethane production established a new record in April 2023
U.S. ethane production reached a new monthly record of 2.7 million barrels per day (b/d) in April 2023, continuing the upward trend that started in 2013, according to data from our Petroleum Supply Monthly. Increased natural gas and ethane production in the Permian Basin, which spans Texas and New Mexico, drove the national increase.
U.S. ethane production rose because of increased natural gas production. Ethane, which serves mainly as a petrochemical feedstock, is recovered along with other natural gas plant liquids(NGPLs) at natural gas processing plants as raw natural gas from wells is processed to meet natural gas pipeline specifications. Marketed natural gas production, in which we include both dry natural gas and NGPLs before they are separated out, also set records this year. For the first half of the year (1H23), U.S. marketed natural gas production averaged 111 billion cubic feet per day, a record high.
Ethane production in the Texas Inland region and New Mexico areas that include the Permian Basin accounted for 60% of U.S. ethane production during 1H23, slightly higher than the 58% share in 1H22. Ethane production in these two districts averaged 1.5 million b/d in 1H23, a 10.3% (0.1 million b/d) increase from 1H22. Ethane production during 1H23 in other U.S. refining districts was essentially unchanged from 1H22.
U.S. ethane production grew in response to rising demand from both domestic and global consumers. An average of 2.1 million b/d of ethane was consumed in the United States in 1H23, essentially unchanged from 1H22, and ethane consumption set a record of 2.2 million b/d in May 2023. U.S. ethane exports set a record in March 2023, averaging 537,000 b/d. In 1H23, the United States exported an average of 493,000 b/d, a 90,000 b/d increase from 1H22. The United States has exported ethane for nearly a decade and became the world’s largest exporter of ethane in 2015 .
In our Short-Term Energy Outlook, we expect ethane production to average 2.6 million b/d in 2023, a 9% increase compared with 2022, and 2.7 million b/d in 2024, a 2% increase compared with 2023. We expect domestic ethane consumption to average 2.1 million b/d in 2023, a 6% increase compared with 2022, and 2.2 million b/d in 2024, a 2% increase compared with 2023. We expect U.S. ethane exports to continue growing through the rest of 2023 and 2024, averaging 500,000 b/d by December 2024.