Calgary-based energy infrastructure company AltaGas Ltd. says it has established a foothold in China’s propane market in less than a year and is now looking to seize further expansion opportunities across Asian markets.AltaGas opened Canada’s first propane export terminal at Ridley Island near Prince Rupert, BC, in 2019.The Canadian Press reports that virtually all of the terminal’s cargo went to Japan and South Korea until April of last year, when it was finally able to tap into the Chinese market, where it now supplies roughly 6% of China’s propane imports.AltaGas also accounts for 11% of Japan’s liquefied petroleum gas (LPG) imports and 14% of South Korea’s.While demand in those two markets has stayed relatively flat, Randy Toone, executive vice-president at AltaGas and president of its midstream division, said the company has been able to grow its market share due to its logistical advantage over US competitors.“When you look at the growth in China, it's been largely residential, with more people moving out of poverty and using propane to heat their homes and cook,” Toone said.“They've been using other products like wood and coal.”.Carney signs China energy deal as trade tariffs remain unresolved.He added that while China is “modernizing,” the country has been building a large number of petrochemical facilities.“We want to penetrate that market further, and that's where a lot of the demand growth is coming from,” he said.AltaGas’s expansion comes as Tim Hodgson, Canada’s Minister of Energy and Natural Resources, and his Chinese counterpart signed a renewed memorandum of understanding (MOU) energy pact on Thursday during Prime Minister Mark Carney and his Canadian delegation’s trip to China.“The participants recognize Canada as an important potential partner in responsibly produced and reliable global oil, LNG and LPG supply and will explore opportunities for mutually beneficial cooperation,” the MOU reads.AltaGas now expects propane and butane imports into Asia to increase by 40 to 50% by 2040.AltaGas’s Ridley Island Propane Export Terminal has storage capacity for 1.2 million tonnes of propane annually and is licensed to export up to 92,000 barrels per day.The propane is delivered by rail, cooled on site, and loaded onto ships.Netherlands-based storage company Vopak owns a 30% stake in the terminal.Construction is currently underway on an adjacent facility, the Ridley Island Energy Export Facility (REEF), a 50-50 joint venture between AltaGas and Vopak.REEF is designed to export both propane and butane initially, with the potential to add other products later..Canada, China strike trade deal reducing canola, pork, seafood, EV tariffs.The facility is expected to begin operations in early 2027.Last year, AltaGas also announced an agreement to supply butane from REEF to Swiss-based BASF Intertrade for use in its petrochemical operations in China.Toone said AltaGas already has the necessary approvals and permits for two optimization projects at REEF and does not currently plan to use the federal government’s Major Projects Office.Longer term, AltaGas is planning an expansion at REEF to allow for exports of products beyond propane and butane, such as methanol.“We potentially might use the Major Projects Office for that, but right now we're not ready,” Toone said.“We do support what they're doing, but we don't have any kind of projects teed up.”Toone also stated AltaGas is looking at First Nations equity agreements, but noted that it is “early days for those.”
