This article was published by the National Energy Board of Canada on July 10, 2019.
Production of liquids-rich natural gas has grown over the last six years in Canada, increasing potential natural gas liquids (NGL) supply, including ethane. However, not all ethane present in the gas stream is recovered because Canadian ethane demand is limited.
The figure below shows ethane potential broken into the amount of ethane that is produced and the amount of ethane that is not recovered. Importantly, ethane potential—especially unrecovered ethane—is projected to continue growing as natural gas production grows.
Figure 1: Projected Ethane Potential through 2040
Figure 1 includes projections of ethane potential for all four Canada’s Energy Future 2018 cases. Even with lower natural gas production in the Low Price Case, ethane potential is significantly higher than ethane production. This implies room for additional petrochemical demand for ethane to develop in western Canada. The majority of ethane disposition is petrochemical demand in Alberta and Ontario. While Alberta’s petrochemical capacity expanded in 2016, future expansions are uncertain, so their capacity is held constant. Ontario’s petrochemical capacity will increase over the next few years, but since there is no domestic supply of ethane in eastern Canada, imports into Ontario from Pennsylvania and Ohio supply the demand.
For additional information see Canada’s Energy Future 2018 Supplement: Natural Gas Liquids Supply and Disposition.