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European LPG Sector Overview 2016

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| 2European LPG Sector Overview 2016

Data and information contained in this study come from a variety of sources including official agencies, original research and analysis conducted by Argus personnel, proprietary sources maintained by Argus and market contacts. Argus has endeav-oured to ensure that the information and data contained in this study are reliable, but the inherent difficulties in obtaining information on often opaque and commercially sensitive markets should be noted by the client. In addition, rounding errors, differing definitions and/or the use of multiple sources may have led to instances in which some data and/or information may appear to be inconsistent. Some 2013 data has been revised on receipt of further information from country sources. Argus has endeavoured to resolve these apparent inconsistencies, but some may remain.

Any projected market or price developments, growth or future performance contained in this study merely reflect the rea-sonable judgment of Argus, developed using standard analytical and projection techniques, at the time of the preparation of this material. Such future projections are based on consideration of a wide range of factors including market, economic and political — many of which are inherently uncertain and potentially subject to unpredictable and unforeseeable events. Accordingly, Argus offers no assurance whatsoever regarding the consistency of any projections relative to actual outcome in the future.

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Table of contents

Introduction 4

Summary data 7

Austria 12

Belgium 12

Bosnia and Herzegovina 13

Bulgaria 13

Croatia 14

Cyprus 14

Czech Republic 15

Denmark 15

Estonia 16

Finland 16

France 17

Germany 17

Greece 18

Hungary 18

Ireland 19

Italy 19

Latvia 20

Lithuania 20

Luxembourg 21

Malta 21

Montenegro 22

Netherlands 22

Norway 23

Poland 23

Portugal 24

Romania 24

Serbia 25

Slovakia 25

Slovenia 26

Spain 26

Sweden 27

Switzerland 27

Turkey 28

UK 28

Ukraine 29

Copyright © 2016 Argus Media group


Summary Of KEy EurOPEan LPG marKEt StatiSticS

Demand grows, production steadyEurope had a good year in 2015 in terms of demand, which rose 6pc higher year-on-year to reach over 37mn t — al-though much of this demand rise depended on sustained year-round demand from the petrochemical sector.

But there were also some welcome surprises from the mature household markets, in particular northwest European coun-tries, where demand grew. And autogas also gained ground in a number of key markets.

Europe therefore remains one of the global regional power-houses for LPG but in recent years much of the growth has come from central and eastern Europe rather than the longer-established markets in northwest and south Europe. 2015 showed how resilient these more mature markets are, even when there is no sustained winter weather to boost household heating demand.

European LPG production reached 24.2mn t in 2015, up by just 0.5pc year-on-year — and dominated by output from gas processing plants.

The 2015 statistics include EU member states and applicant countries, plus those in the European Free Trade Agreement — but exclude Russia.

rebounding consumptionThe region's traditional heating sector demand rebounded in 2015, after posting drops in both 2013 and 2014 — demon-strating that weak weather-related consumption was largely responsible for the temporary decline in the markets in the two previous years, rather than a switch from LPG to other fuels.

LPG remains a key off-grid heating fuel for Europe and sta-tistical evidence is beginning to emerge that shows a switch to LPG could be under way in some markets, especially in the light industrial sector. This is welcome news for the industry, and attests to the inventive marketing efforts from distrib-uting firms determined to commercialise new uses for LPG, especially as a boiler fuel.

Many of the large mature heating markets in northwest Eu-rope registered higher consumption — with France, Italy and Spain, in particular, recording year-on-year gains of 21pc,

6pc and 12pc, respectively. The sizeable 527,000 t/yr German residential market was stable, but there was a drop in Por-tugal — not especially surprising because it was one of the few countries where demand increased relatively strongly in 2014.

Consumption in the UK, which is more reliant on its industrial sector, rose by a strong 10pc to 3.1mn t/yr, with the non-feedstock markets consuming 1mn t.

The general trend of higher demand was also evident across many of Europe's smaller markets, although some countries in eastern Europe, where demand is usually dominated by autogas, did register a slight decline.

mixed fortunes for autogasBut it was a mixed year for autogas, which could be entering a critical period in terms of uptake.

The traditional demand centres of Italy, Poland and Turkey continued to show solid, if unspectacular, growth — which considering the high penetration of the fuel is not surpris-ing. Urban emissions curbs offer the main opportunity for autogas as a low-emissions fuel.

Some markets in eastern Europe continue to thrive — most notably Ukraine, which is now consuming more than 1mn t/yr of LPG, almost entirely in the country’s buoyant trans-port sector, while Bulgaria's autogas market is approaching 500,000 t/yr.

But the growth story for autogas was less consistent in northwest Europe, where the Dutch, French and German autogas markets declined in 2015. The small Dutch market, in particular, may be entering a new contraction phase after the introduction of a higher excise rate.

Petrochemical strength Petrochemical demand for LPG had a strong year as a result of a favourable LPG price compared with competing feed-stock naphtha. Almost 50pc of Europe's LPG consumption in 2015 was as a feedstock for ethylene crackers — way more than the global average of around 26pc.

But not all petrochemical markets flourished — and two im-portant demand centres, Belgium and the Netherlands both saw a drop in petrochemical demand.



Most import and export flows stayed within the region in 2015 — but Russia and the US continued to increase their share of the import market. The US has, since 2013, become a key large cargo supplier of propane to coastal northwest European petrochemical crackers.

Supply diversificationBoth Russia and the US increased LPG output from natural gas processing and expanded export availability. And both countries also expanded their export capacity in 2015, as they looked to better service import markets.

US shipments to Europe grew to over 3.27mn t/yr in 2015 from around 2.6mn t/yr a year earlier, while total Russian exports topped 6mn t/yr, the majority of which headed to northwest Europe — or through the Black Sea to Turkey and the Mediterranean.

The longer-term result has been the further diversification of Europe's supply sources. This is a trend that we expect to continue not just in 2016, but also into the next decade, as gas producing countries increase output, build more export capacity and make use of the expanding global fleet of very large gas carriers — which now stands at over 250 ships, more than 70 of which have hit the water in the past three years.

Production flatRegional LPG production was flat compared with 2014 at just over 24mn t, with output from the refinery sector down by around 200,000t, but counterbalanced by a rise in gas processing output.

Europe’s key regional exporter remained Norway, which saw output rise by 2.6pc year-on-year to 5.27mn t. This is still significantly lower than the peak output of 6.05mn t seen in 2011, but reversed two years of gradual decline.

Northwest Europe’s other regional giants in terms of produc-tion also saw relatively strong rises. UK production grew by 7pc to 3.3mn t/yr, while the Netherlands posted an even stronger year-on-year rise of 9.1pc to just over 2mn t. Ger-many also registered a 5.5pc rise in production to 2.65mn t/yr — the highest level since 2007.

All four form the backbone of northwest European large cargo trade flows, along with France and Belgium. But France posted a relatively strong 30pc decline, with production dropping to 1.43mn t — suggesting the 2014 production rise was a one-off.

Turkey’s dominance as a regional consumer overshadows its own production strength, which grew by over 27pc year-on-year to 889,000t, only matched in the Mediterranean by Italy, where output also grew by 6.5pc to 1.73mn t — reversing two years of declines.

Striking resultsThe 2015 statistics threw up plenty of surprises across the region. The report contains detailed country-by-country breakdowns, but some of the most notable results are de-tailed separately below.

Ukraine, for example, showed further evidence that its terri-torial dispute with Russia that heavily impacted trade flows in 2014 only temporarily quelled consistent demand strength. Overall demand reached over 1.14mn t in 2015, 8.7pc higher than in 2014 and dominated by an autogas sector — driven by low prices compared with conventional transport fuels — that now consumes just over 1mn t/yr. Ukraine’s autogas fleet of 2mn vehicles is just under half that of Turkey and around 1mn vehicles lower than in Poland.

Poland’s return to growth for a second year running also de-pended on autogas where demand grew by 2.7pc to 1.69mn t. The days of surging growth may be over, but the autogas sector in Poland has shown resilience and continues to at-tract support from vehicle manufacturers.

France’s 10pc growth in demand to 4.21mn t was another notable result in 2015 — because it was the third successive year of growth, and pace of growth seems to be picking up. This is the first time French demand topped 4mn t/yr.

Spain, another mature market in terms of household heating demand, actually saw consumption increase for the fourth year in a row, up by 2.6pc to 2.27mn t/yr in 2015. The country is slowly growing an autogas sector, with the vehicle fleet now over 58,000 and demand up by 18pc to 39,000 t/yr — one of the smallest in west Europe.



Some surprises came in 2015 from smaller markets, such as Sweden where demand reached 910,000t, over 19pc higher than in 2014 — and, unusually for the region, was centred on light industrial demand.

Bulgaria, too saw demand rise strongly by 12.4pc, and like Ukraine depends on a vibrant autogas sector. Demand stayed flat in other east and south European countries, such as Romania, Serbia and Hungary.

The year saw bearish results from the Czech Republic, with demand dropping by a significant 22pc to 209,000t, the lowest level since 2012, though this lack of demand was due to a reduction in consumption in the petrochemical sector. The country’s output also shrank by over 7pc to 248,000 t/yr. Neighbouring Slovakia in contrast saw both demand and production rise — although the market is about half the size of the Czech Republic.

Results from the Baltic states of Estonia, Latvia and Lithu-ania were also bearish. Only Lithuania has a relatively strong autogas sector — but the country’s autogas demand stayed flat at 141,000 t/yr.

Ireland also saw demand strength, rising by 9.6pc in 2015 to 137,000t — the strongest consumption level since 2008. Like Sweden, industrial demand is the country’s major consump-tion source. A small autogas market, which is based entirely on retrofitted vehilces is also emerging in the country.

Market price conditions � LPG prices in northwest Europe dropped significantly at

the end of 2014 — as the price of crude tumbled, following Opec’s decision to abandon production limits — and large cargo LPG prices remained in a $300-400/t cif Amsterdam-Rotterdam-Antwerp (ARA) range for most of 2015, with an often narrower than normal spread between propane and butane.

� Large cargo prices briefly peaked in early March at around $467/t cif ARA but lost ground and dropped to the lows of the year of under $250/t cif ARA by the end of August.

� Unseasonably weak heating demand in the first and fourth quarters meant that pricing was principally deter-

mined by movements in crude markets rather than any fundamentals of supply and demand.

� At one point in December, LPG actually rose — briefly — to above 110pc of crude.

� But demand was also sustained throughout most of the year from the region’s massive petrochemicals sector, which took advantage of LPG’s falling value relative to naphtha by cracking propane year-round — a trend that has continued into 2016.

� Trade flows in the Black Sea saw Russian terminals gain business at the expense of Ukrainian ports. Conversely, Russia became the main supplier to Ukraine in 2015 — with up to a 50pc share of the Ukrainian import market, despite political tensions between the two countries.

� US prices were unable to compete on a spot arbitrage basis, but this did not stem the steady flow of large cargo propane exports to Europe, mainly heading to the large terminals of coastal petrochemical facilities in northwest Europe.



Summary Of KEy EurOPEan LPG marKEt StatiSticS

Production by source '000t

Country 2014 2015

Refinery Gas Processing Total Refinery Gas Processing Total ±% 14/15

Austria 245 - 245 260 - 260 6.1

Belgium 706 - 706 671 - 671 -5.0

Bosnia and Herzegovina 24 - 24 22 - 22 9.0

Bulgaria 84 - 84 101 - 101 20.2

Croatia 189 44 233 210 39 249 6.9

Cyprus - - - - - - -

Czech Republic 208 59 267 220 28 248 -7.1

Denmark 131 - 131 124 - 124 -5.3

Estonia - - - - - - -

Finland 288 - 288 246 - 246 -14.6

France 2,044 - 2,044 1,430 - 1,430 -30.0

Germany 2,518 - 2,518 2,656 - 2,656 5.5

Greece 630 - 630 640 - 640 1.6

Hungary 59 107 166 60 95 155 -6.6

Ireland 67 - 67 53 - 53 -20.9

Italy 1,628 - 1,628 1,734 - 1,734 6.5

Latvia - - - - - - -

Lithuania 218 - 218 230 - 230 5.5

Luxembourg - - - - - - -

Malta - - - - - - -

Montenegro - - - - - - -

Netherlands 1,632 283 1,915 1,735 354 2,089 9.1

Norway 427 4,710 5,137 512 4,761 5,273 2.6

Poland 390 - 390 375 - 375 -3.8

Portugal 445 - 445 243 - 243 -45.4

Romania 560 - 560 549 - 549 -

Serbia 108 - 108 110 - 110 1.9

Slovakia 126 - 126 140 - 140 11.1

Slovenia - - - - - - -

Spain 1,346 - 1,346 1,404 - 1,404 4.3

Sweden 423 - 423 488 - 488 15.4

Switzerland 185 - 185 130 - 130 -29.7

Turkey 698 - 698 889 - 889 27.4

Ukraine 71 372 443 65 356 421 -5.0

UK 2,127 958 3,085 2,208 1,093 3,301 7.0

Total 17,577 6,533 24,110 17,505 6,726 24,231 0.5



Availabity to European markets '000t

Country Production Imports Exports Consumption

Austria 260 53 - 320

Belgium 671 2,574 802 2,373

Bosnia and Herzogovina 22 45 2 60

Bulgaria 101 375 15 461

Croatia 249 37 128 163

Cyprus - 54 - 54

Czech Republic 248 99 140 209

Denmark 124 25 95 50

Estonia - 19 1 18

Finland 246 680 - 953

France 1,430 3,515 993 4,215

Germany 2,656 741 269 2,937

Greece 640 42 209 473

Hungary 155 220 54 355

Ireland 53 120 16 137

Italy 1,734 2,246 235 3,481

Latvia - 215 124 91

Lithuania 230 113 155 174

Luxembourg - 8 - 9

Malta - 26 - 26

Montenegro - 37 - 36

Netherlands 2,089 3,835 1,833 3,713

Norway 5,273 210 4,588 735

Poland 375 2,090 220 2,245

Portugal 243 743 74 987

Romania 549 135 220 477

Serbia 110 245 35 361

Slovakia 140 73 60 105

Slovenia - 85 4 82

Spain 1,404 741 - 2,272

Sweden 488 985 567 910

Switzerland 130 51 5 89

Turkey 889 3,461 258 4,250

Ukraine 421 696 - 1,147

UK 3,301 798 813 3,144

Total 24,231 25,392 11,915 37,112



Demand by sector '000t

Country Domestic Agriculture Industry Transport Refinery Chemical Total Total ±% 14/15

Austria 70 10 10 20 - 210 320 10.3

Belgium 90 28 53 43 - 2,159 2,373 30.1

Bosnia and Herzegovina 7 15 38 - - 60 -

Bulgaria 15 4 28 414 - - 461 12.4

Croatia 49 3 46 65 - - 163 5.8

Cyprus 35 1 18 - - - 54 12.5

Czech Republic 4 3 26 83 - 93 209 -22.9

Denmark 17 3 29 1 - - 50 4.2

Estonia 10 2 2 4 - - 18 -5.3

Finland 6 - 267 - - 680 953 23.8

France 1,232 338 228 81 - 2,336 4,215 10.1

Germany 527 - 635 427 - 1,348 2,937 8.5

Greece 85 - 133 255 - - 473 11.3

Hungary 75 21 34 25 - 200 355 1.7

Ireland 29 - 105 3 - - 137 9.6

Italy 1,335 56 211 1,642 14 223 3,481 7.0

Latvia 13 5 14 59 - - 91 -2.2

Lithuania 29 3 1 141 - - 174 -

Luxembourg 1 - 7 1 - - 9 12.5

Malta 18 - 7 1 - - 26 4.0

Montenegro 11 - 4 21 - - 36 -

Netherlands 96 20 15 183 - 3,399 3,713 -21.4

Norway 8 - 184 2 - 541 735 25.6

Poland 290 105 160 1,690 - - 2,245 2.0

Portugal 505 7 64 33 6 372 987 -3.4

Romania 182 - 15 280 - - 477 -

Serbia 50 1 45 265 - - 361 0.6

Slovakia 9 2 3 34 - 57 105 2.9

Slovenia 48 - 22 12 - - 82 10.8

Spain 1,083 43 264 39 - 843 2,272 2.6

Sweden 17 - 319 1 - 573 910 19.1

Switzerland 16 5 51 3 10 4 89 -11.9

Turkey 816 - 176 3,093 - 165 4,250 10.8

Ukraine 52 10 35 1,050 - - 1,147 8.7

UK 252 90 637 82 - 2,083 3,144 24.3

Total 7,082 760 3,863 10,091 30 15,286 37,112 6.2



Autogas Statistics '000t

Consumption Number of vehicles Number of dispensing sites

Country 2014 2015 2014 2015 2014 2015

Austria 20 20 7,500 8,000 43 50

Belgium 42 43 42,000 42,000 595 509

Bosnia and Herzegovina 36 38 30,000 33,000 120 130

Bulgaria 368 414 470,000 490,000 2,970 2,900

Croatia 61 65 85,000 87,000 324 310

Cyprus - - - - - -

Czech Republic 75 83 172,000 179,000 1,100 1,100

Denmark 1 1 20 20 4 4

Estonia 1 4 1,000 5,000 30 42

Finland - - - - - -

France 91 81 222,557 206,846 1,750 1,750

Germany 467 427 494,000 476,000 6,850 7,000

Greece 195 255 300,000 400,000 680 850

Hungary 25 25 85,000 85,000 580 600

Ireland 2 3 3,500 4,200 67 67

Italy 1,564 1,642 1,970,000 2,137,078 3,600 3,767

Latvia 59 59 56,368 54,560 211 210

Lithuania 141 141 111,761 112,000 690 690

Luxembourg 1 1 1,000 1,000 14 14

Malta 1 1 600 719 4 5

Montenegro 21 21 10,000 10,000 50 50

Netherlands 205 183 200,150 180,000 1,850 1,750

Norway 2 2 428 420 100 20

Poland 1,645 1,690 2,846,000 2,914,000 5,460 5,420

Portugal 31 33 50,000 50,000 300 340

Romania 275 280 190,000 190,000 1,200 1,200

Serbia 265 265 575,000 575,000 700 700

Slovakia 33 34 15,500 15,500 210 210

Slovenia 11 12 10,500 13,500 75 100

Spain 33 39 40,777 58,038 717 807

Sweden 1 1 105 105 33 39

Switzerland 4 3 1,000 1,000 68 68

Turkey 2,838 3,093 4,076,730 4,272,044 10,397 10,559

Ukraine 950 1,050 1,600,000 2,000,000 3,000 3,500

UK 88 82 144,000 135,000 1,400 1,400

Total 9,552 10,091 13,812,496 14,736,030 45,192 46,161


| 11 European LPG Sector Overview 2016

Imports +80pc

Exports -9pc

Imports +10pc

Exports +132pc

Imports -10pc

Exports -46pc

Imports -10pc

Exports 0pc

Imports +24pc

Exports +147pc

Imports +2pc

Exports -4pc

Imports +10pc

Exports -3pc

Imports +47pc

Exports +21pc

Imports 13pc

Exports -18pc

Imports 41pc

Exports 19pc

Imports +2pc

Exports +9pc

EUROPEAN LPG TRADE MAP: MAJOR IMPORTING AND EXPORTING COUNTRIES

Regional LPG Trade Flows

— Showing selected annual import/export changes in 2014 for trade >1mn t/yr

USExports: +44pcImports: +4pc

MexicoImports: +32pc

BrazilImports: +8pc

ArgentinaExports: -6pc

EuropeExports: +3pcImports: +7pc

RussiaExports: +7pc

China Imports: +70pcExports: +3pc

Qatar, Saudi Arabia & UAEExports: +0pc

India Imports: +8pc

ThailandImports: -34pc

AustraliaExports: -18pc

NigeriaExports: +3pc

AlgeriaExports: +3pc

South KoreaImports: -2pc

JapanImports: -9pc

Imports +14pc

Exports -13pc

Imports +18pc

Exports +0pc



AuStriA

LPG supply/demand balance2014 2015

Total population (mn) 8.5 8.6

Share of urban population (%) 65.9 66.0

Share of rural population (%) 34.1 34.0

LPG production ('000t)

From refinery 245 260

From gas processing - -

Total production 245 260

LPG Imports ('000t) 40 53

LPG Exports ('000t) - -

LPG consumption ('000t)

Domestic 65 70

Agriculture 10 10

Industry 15 10

Transport 20 20

Refinery - -

Chemical 180 210

Total consumption 290 320

Autogas

Number of vehicles 7,500 8,000

Number of dispensing sites 43 50

Passenger car statistics - all fuels

Total vehicles (000's) 4,695

New vehicle registration (000's) 303 309

LPG domestic consumption (kg/capita) 7.6 8.1

• The Austrian LPG market recorded modest growth in 2015, with consumption rising to 320,000t and registering an increase for the second year running.

• Demand from the petrochemicals sector continued to dominate, rising by 30,000t to 210,000t. Domestic consump-tion reversed the declining trend of the previous two years and added 5,000t, to reach 70,000t.

• Autogas demand remained flat at just 20,000t.

Austria primary energy consumption

0

2

4

6

8

10

12

14

16

mn toe2005 2015

BELGium









LPG Imports ('000t) 1,830 2,574

LPG Exports ('000t) 669 802


Domestic 86 90

Agriculture 26 28

Industry 51 53

Transport 42 43

Refinery - -

Chemical 1,619 2,159

Total consumption 1,824 2,373

Autogas




Total Vehicles (000's) 5,511

New Vehicle Registration (000's) 483 501


• Belgium’s central role as part of Europe logistical LPG hub is reflected in its import and export flows. Imports surged to 2.57mn t, while exports grew to 802,000t.

• The country’s overall consumption is dependent on mas-sive petrochemicals demand, which added 540,000t and reached over 2.1mn t. The small domestic household sector rose by a modest 4,000t to 90,000t in 2015.

• Autogas growth was marginal and 86 retail sites shut.

Belgium primary energy consumption

0510152025303540

mn toe2005 2015



BOSnia and HErzEGOvina





LPG production ('000t) 60 60

From refinery 24 22






Domestic 8 7

Agriculture - -

Industry 16 15

Transport 36 38

Refinery - -

Chemical - -


Autogas




Total Vehicles (000's) 920

New Vehicle Registration (000's) 8,900 8,700


• The LPG market in Bosnia and Herzegovina relies on auto-gas for the bulk of its consumption, which grew by 2,000 t in 2015 to 38,000 t/yr.

• The country sources its LPG from two local refineries but covers the majority of its requirements through imports, which reached 45,000 t/yr.

• The number of vehicles is estimated at 33,000 - a growth rate of 10pc versus 2014.

Bosnia and Herzegovina primary energy consumption

0

1

2

3

4

mn toe2005 2015

BuLGaria












Domestic 12 15

Agriculture 4 4

Industry 26 28

Transport 368 414

Refinery - -

Chemical - -


Autogas


Number of dispensing sites 2,970 2,900





• Bulgaria’s market remained dominated by autogas con-sumption, which continued to grow in 2015.

• Autogas demand reached over 400,000 t/yr for the first time — putting the country on track to overtake the more well-established German market. Bulgaria’s autogas fleet reached 490,000 vehicles — only the fleets in Italy, Turkey, Poland, Serbia and Ukraine are larger.

• Household demand rose by 3,000t, or 25pc, to 15,000t.

Bulgaria primary energy consumption

012345678

mn toe2005 2015



CrOatia







From gas processing 44 39





Domestic 47 49

Agriculture 3 3

Industry 43 46

Transport 61 65

Refinery - -

Chemical - -


Autogas







• Croatian demand registered modest gains from the auto-gas and household sectors in 2015 — LPG is also used by light industry.

• Autogas consumption rose by 4,000t in 2015 to 65,000t — relatively small compared with autogas demand in neigh-bouring Serbia.

• Total new autogas vehicle registrations and fuel demand rose, despite a government move to increase excise tax.

Croatia primary energy consumption

0

1

2

3

4

5

mn toe2005 2015

CyPruS






From refinery - -


Total production - -




Domestic 31 35

Agriculture 1 1

Industry 16 18

Transport - -

Refinery - -

Chemical - -


Autogas

Number of vehicles - -

Number of dispensing sites - -





• Cyprus is reliant on LPG imports to meet demand, but arrivals dropped slightly to 48,000t in 2015, despite a small 6,000t rise in consumption.

• Household demand rose by 4,000 t to 35,000t.

• The light industrial sector remains an important source of demand for the country's LPG market. Consumption is small, but is also growing — Cypriot industrial demand increased by 2,000t to 18,000t in 2015.

Cyprus

0

1

2

3

mn toe2005 2015



CzECh REPubLiC












Domestic 4 4

Agriculture 3 3

Industry 25 26

Transport 75 83

Refinery - -

Chemical 164 93


Autogas







• The Czech LPG market faced challenges in 2015, with de-mand bucking the general European trend and contracting by 62,000t to 209,000t.

• This drop reflected a relatively strong 40pc decline in con-sumption by the petrochemicals industry, which plunged by 71,000t to 93,000t.

• The autogas sector registered modest growth in both demand and in the number of registered vehicles.

Czech Republic primary energy consumption

0

5

10

15

20

25

mn toe2005 2015

DEnmaRk












Domestic 21 17

Agriculture 3 3

Industry 23 29

Transport 1 1

Refinery - -

Chemical - -


Autogas

Number of vehicles 20 20






• Denmark’s LPG production significantly outstrips its con-sumption, making the country a modest exporter.

• Shipments rose by 14.5pc to 95,000t in 2015, compared with 83,000t a year earlier.

• Demand remained dominated by the country's light industrial sector, for which consumption rose by 6,000t to 29,000t. Household cooking and heating demand contract-ed to just 17,000t.

Denmark primary energy consumption

012345678910

mn toe2005 2015



EStOnia






From refinery - -




LPG Exports ('000t) - 1


Domestic 13 10

Agriculture 3 2

Industry 2 2

Transport 1 4

Refinery - -

Chemical - -


Autogas







• Estonian LPG demand contracted in 2015, but by only a modest 1,000t to 18,000t — most of the decline came from the household sector.

• Unlike its Baltic neighbours, Latvia and Lithuania, the autogas sector has failed to gain significant market share, with just 4,000t consumed in 2015. But this does represent a growing market, having increased from 1,000t in 2014.

• Household demand fell to 10,000t from 13,000t.

Estonia primary energy consumption

0

5

10

15

20

25

mn toe2005 2015

FinLand










LPG Exports ('000t) 15 -


Domestic 6 6

Agriculture - -

Industry 260 267

Transport - -

Refinery - -

Chemical 504 680


Autogas

Number of vehicles - -

Number of dispensing sites - -





• Finland’s massive petrochemicals sector needs reached 680,000t in 2015, accounting for the majority of demand and imports — which grew by a massive 200,000t to exactly match chemicals consumption.

• The country was the sixth-largest petrochemicals user of LPG in Europe.

• Industrial demand grew, but only slightly — rising by 7,000t to 267,000t.

Finland primary energy consumption

0

2

4

6

8

10

12

mn toe2005 2015



FrancE






From refinery 2,044 1,430


Total production 2,044 1,430

LPG Imports ('000t) 3,231 3,515

LPG Exports ('000t) 1,200 993


Domestic 1,014 1,232

Agriculture 364 338

Industry 241 228

Transport 91 81

Refinery - -



Autogas







• French demand recorded another positive year of growth, helped by a rise in the core household sector and petro-chemicals industry gains. Total demand rose by a strong 386,000t to 4.22mn t — a record high.

• Households added over 218,000t of demand in 2015 — a significant gain, pushing consumption to 1.23mn t.

• Demand from the country's petrochemicals sector jumped by 10.2pc to 2.34mn t in 2015.

France primary energy consumption

0

20

40

60

80

100

120

mn toe2005 2015

GErmany












Domestic 520 527

Agriculture - -

Industry 623 635

Transport 467 427

Refinery - -



Autogas







• Germany's LPG consumption rose by a healthy 8.5pc to 2.94mn t in 2015 — although this was still short of peak demand reached in 2013.

• Growth mainly came from the 1.35mn t/yr petrochemicals sector. But household consumption also gained ground, despite the lack of very cold winter weather.

• The fortunes of the country's autogas business remained mixed — demand was static but the vehicle fleet contracted.

Germany primary energy consumption

0

20

40

60

80

100

120

140

mn toe2005 2015



GrEEcE












Domestic 87 85

Agriculture - -

Industry 143 133

Transport 195 255

Refinery - -

Chemical - -


Autogas







• The Greek market's phase of robust growth showed no signs of slowing down, led by an autogas sector that has defied expectations to become one of the most significant markets in western Europe.

• Overall demand rose to 473,000t, 11.3pc higher than in 2014. Autogas demand alone accounted for 255,000t — growing by 60,000t in just one year.

• Greece’s autogas fleet added another 100,000 vehicles.

Greece primary energy consumption

0

5

10

15

20

25

mn toe2005 2015

HunGary






From refinery 59 60






Domestic 72 75

Agriculture 36 21

Industry 33 34

Transport 25 25

Refinery - -

Chemical 183 200


Autogas







• The rate of Hungary’s demand growth slowed in 2015, with overall consumption rising by just 1.7pc to 355,000t.

• The country’s household cooking and heating sector rose slightly from 72,000t to 75,000t. But this was more than counter-balanced by the decrease in demand from the agri-cultural sector — mainly to heat greenhouses — which was 21,000t compared with 36,000t in 2014.

• Petrochemicals demand rose by 9.2pc to 200,000 t/yr.

Hungary primary energy consumption

0

2

4

6

8

10

12

14

mn toe2005 2015



IrELand






From refinery 67 53






Domestic 29 29

Agriculture - -

Industry 94 105

Transport 2 3

Refinery - -

Chemical - -


Autogas







• The Irish LPG market, which relies on the industrial sector for the bulk of its consumption, grew by 10pc in 2015, as a result of a stronger heating season in northwest Europe. Imports covered the country's additional requirements be-cause production from the country's only refinery was down by 14,000t compared with 2014.

• The country's small autogas market continued to grow, with the number of vehicles on the road reaching more than 4,000, consuming 3,000t in 2015.

Ireland primary energy consumption

012345678910

mn toe2005 2015

ItaLy









LPG Imports ('000t) 2,204 2,246



Domestic 1,259 1,335

Agriculture 53 56

Industry 199 211

Transport 1,564 1,642

Refinery 14 14

Chemical 164 223


Autogas

Number of vehicles 1,970,000 2,137,078






• Italy recorded demand increases of more than 5pc in both of its key market sectors, heating and autogas, as well as increased LPG consumption by the petrochemicals industry.

• The primary reason behind rising autogas demand was a greater increase in autogas vehicle registrations than for vehicle scrappage.

• Domestic household demand rose to 1.34mn t, adding nearly 100,000t compared with 2014.

Italy primary energy consumption

0102030405060708090100

mn toe2005 2015



Latvia






From refinery - -






Domestic 19 13

Agriculture 3 5

Industry 12 14

Transport 59 59

Refinery - -

Chemical - -


Autogas






LPG domestic consumption (kg/capita) 10 6

• Latvian consumption lost ground in 2015, dropping by 2.2pc to 91,000t, bringing to an end several years of year-on-year growth.

• Demand from the country’s small 59,000 t/yr autogas sec-tor stabilised, but the autogas vehicle fleet contracted.

• The household cooking and heating market is one of the smallest in Europe and fell to only 13,000t in 2015 — now outstripped by the 14,000 t/yr industrial sector.

Latvia primary energy consumption

0

50

100

150

200

250

300

mn toe2005 2015

Lithuania












Domestic 29 29

Agriculture 3 3

Industry 1 1

Transport 141 141

Refinery - -

Chemical - -


Autogas







• Lithuania’s autogas market remains the largest in the Baltic states, but demand was flat at 141,000t in 2015.

• The number of vehicles in the autogas fleet increased slightly, to 112,000 from 111,761 in 2014.

• LPG production from the country's sole refinery rose to 230,000t. Around 155,000t of this output was exported to neighbouring countries, but Lithuania also imported about 113,000t in 2015.

Lithuania primary energy consumption

0

1

1

2

2

3

3

mn toe2005 2015



LuxEmbOurG






From refinery - -




LPG Exports ('000t) 1 -


Domestic 1 1

Agriculture - -

Industry 6 7

Transport 1 1

Refinery - -

Chemical - -


Autogas






LPG domestic consumption (kg/capita)

• Luxembourg uses LPG primarily in the industrial sector, which saw a slight increase in consumptioni 2015.

• The country has a nominal autogas market of around 1,000 t/yr. The fuel market is dominated by diesel, which enjoys a light excise rate relative to neighbouring countries.

• There is no LPG production in the country, meaning it is re-liant on supply from Germany France and Belgium to cover its supply requirements

Luxembourg primary energy consumption

0

1

2

3

mn toe2005 2015

maLta






From refinery - -






Domestic 17 18

Agriculture - -

Industry 7 7

Transport 1 1

Refinery - -

Chemical - -


Autogas







• Further growth in Maltese LPG demand pushed the island’s consumption up to 26,000t in 2015.

• Malta has a small, growing autogas sector, with a fleet of only 700 vehicles. But this market did not even exist last decade. Autogas consumption is around just 1,000 t/yr, but offers growth possibilities.

• Domestic household demand for cooking and heating increased by just 1,000t to 18,000t in 2015.

malta primary energy consumption

0100200300400500600700800900

1,000

000 toe2005 2015



MOntEnEGrO






From refinery - -






Domestic 12 11

Agriculture - -

Industry 3 4

Transport 21 21

Refinery - -

Chemical - -


Autogas




Total Vehicles (000's)

New Vehicle Registration (000's)


• Montenegro's market relies on imports to meet demand of 36,000 t/yr and, like neighbouring Balkan countries, has a small autogas sector.

• Autogas consumption was stable at around 21,000t in 2015, with a vehicle fleet of just 10,000 cars and a small retail network of 50 outlets.

• The household sector consumed just 11,000t in 2015, a 1,000t drop compared with the previous year.

Montenegro primary energy consumption

050100150200250300350400450

000 toe2005 2015









LPG Imports ('000t) 4,622 3,835

LPG Exports ('000t) 1,625 1,833


Domestic 98 96

Agriculture 20 20

Industry 15 15

Transport 205 183

Refinery - -



Autogas







• The Netherlands’ importance as a regional LPG trading hub was reflected in the massive trade flows recorded in 2015. Although imports contracted to 3.84mn t, compared with 4.6mn t in 2014, the country's exports rose by over 11pc to 1.8mn t, against 1.63mn t in 2014.

• Consumption remained dominated, overwhelmingly, by demand from the petrochemicals sector, which reached 3.4mn tin 2015. But this was a near 1mn t fall from 2014 and was reflected in the lower import figure.

netherlands primary energy consumption

0

10

20

30

40

50

60

mn toe2005 2015

nEthErLandS



NOrway







From gas processing 4,710 4,761



LPG Exports ('000t) 4,788 4,588


Domestic 8 8

Agriculture - -

Industry 163 184

Transport 2 2

Refinery - -

Chemical 412 541


Autogas







• Norway is Europe’s top LPG producer and output climbed by 2.6pc year on year to 5.27mn t in 2015.

• Exports also increased, reaching 4.76mn t. Most shipments head to northwest Europe, but some Norwegian supply also makes the long-haul trip to Asia-Pacific markets. China imported 207,000t from Norway in 2015.

• Consumption made gains in the industrial and chemicals sectors, but household demand was static at 8,000t.

Norway primary energy consumption

0

5

10

15

20

25

30

35

mn toe2005 2015

POLaNd









LPG Imports ('000t) 2,040 2,090



Domestic 299 290

Agriculture 100 105

Industry 156 160


Refinery - -

Chemical - -


Autogas







• Poland provided good news for the European LPG industry, with a second consecutive year of autogas demand growth, which reached 1.69mn t in 2015.

• The country's autogas fleet increased to more than 2.91 million vehicles, and increase of more than 2pc versus 2014, and a total that may reach 3 million in 2016.

• But household demand contracted to 290,000t in 2015, 9,000t lower than in 2014.

Poland primary energy consumption

0

5

10

15

20

25

30

mn toe2005 2015



POrtuGaL












Domestic 549 505

Agriculture 7 7

Industry 71 64

Transport 31 33

Refinery 7 6

Chemical 357 372

Total consumption 1,022 987

Autogas







• A weather-related surge in Portuguese household heat-ing demand in 2014 was not repeated in 2015, and demand contracted in this sector by 8.0pc to 505,000t.

• Imports rose as refinery LPG production fell relatively sharply. Output dropped by 45.4pc year on year to 243,000t in 2015. But imports took up the slack, climbing to 743,000t, compared with 600,000t in 2014.

• Chemicals sector demand climbed by 4.2pc to 372,000t.

Portugal primary energy consumption

024681012141618

mn toe2005 2015

rOmania












Domestic 187 182

Agriculture - -

Industry 15 15

Transport 275 280

Refinery - -

Chemical - -


Autogas







• LPG consumption in Romania remained flat in 2015, at around 477,000t.

• A small decline in domestic household demand for cook-ing and heating, was counterbalanced by a modest increase in autogas usage. Autogas consumption of 280,000t was the second-highest in the Balkan region.

• Demand from the country's industrial sector was un-changed at 15,000t in 2015.

romania

024681012141618

mn toe2005 2015



SErbia












Domestic 51 50

Agriculture 1 1

Industry 42 45

Transport 265 265

Refinery - -

Chemical - -


Autogas







• Serbian LPG demand remains overwhelmingly dominated by autogas — a price-driven market that has grown rapidly over the past five years.

• But the rate of growth slowed in 2015, with demand for autogas unchanged at 265,000t.

• Serbia has become a significant LPG importer, with arrivals of 245,000t in 2015 up by 5,000t, while exports fell by the same amount to 35,000t.

Serbia primary energy consumption

0

1

2

3

4

mn toe2005 2015

SLOvakia


Total population (mn) 5 5










Domestic 8 9

Agriculture 2 2

Industry 3 3

Transport 33 34

Refinery - -

Chemical 56 57


Autogas







• Slovak demand rose in 2015 — unlike its neighbour the Czech Republic. And imports jumped by 87.2pc to 73,000t, compared with 39,000t in 2014.

• Overall consumption increased by 2.9pc year on year to reach 105,000t. The country’s household sector is a small 9,000 t/yr market.

• Petrochemicals sector demand remained steady at 57,000t, compared with 56,000t in 2014.

Slovakia primary energy consumption

0

1

2

3

4

5

6

7

mn toe2005 2015



SLOvEnia






From refinery - -






Domestic 45 48

Agriculture - -

Industry 18 22

Transport 11 12

Refinery - -

Chemical - -


Autogas




Total Vehicles (000's) 1,077 -



• Slovenian LPG demand continued the positive growth trend of 2014, rising by a strong 10.8pc to 82,000t in 2015.

• The market may be small, but its growth is one of the strongest in south Europe. Household demand reached 48,000t in 2015.

• Slovenia has an unusually large industrial sector for the size of its demand, at around 22,000t — nearly twice the size of the autogas market.

Slovenia primary energy consumption

0

1

2

3

mn toe2005 2015

SPain












Domestic 971 1,083

Agriculture 41 43

Industry 364 264

Transport 33 39

Refinery - -

Chemical 805 843


Autogas







• Spain remains one of southern Europe’s largest LPG mar-kets. Overall consumption rose by 2.6pc year-on-year to 2.27mn t in 2015.

• The mature household cooking and heating sector re-turned to growth in 2015, reaching 1.08mn t, but the indus-trial sector contract by 100,000 t compared with 2014.

• Autogas demand grew by 6,000t to 39,000t in 2015, while the vehicle fleet expanded to just over 58,000.

Spain primary energy consumption

es

0102030405060708090

mn toe2005 2015



SwEdEn









LPG Imports ('000t) 1,026 985



Domestic 29 17

Agriculture 1 -

Industry 316 319

Transport 1 1

Refinery - -

Chemical 417 573


Autogas







• Swedish LPG demand registered one of the strongest performances in Europe, rising by over 19pc year-on-year to reach 910,000t in 2015.

• Consumption is mainly in the industrial and petrochemicals sectors, which accounted for 98pc of demand.

• Petrochemicals alone accounted for more than half of total consumption, at 573,000t. Light industrial demand — sup-posedly under threat from LNG — topped 319,000t.

Sweden primary energy consumption

02468101214161820

mn toe2005 2015

SwitzErLand












Domestic 18 16

Agriculture 5 5

Industry 50 51

Transport 4 3

Refinery 20 10

Chemical 4 4


Autogas







• Swiss demand fell by nearly 12pc to 89,000t in 2015, down from 101,000t a year earlier.

• The market has declined steadily for over a decade and the only sector to record demand growth — albeit minimal — was light industry, where consumption gained just 1,000t to reaching 51,000t in 2015.

• But imports rose to 51,000t, to counter-balance a fall in LPG production from local refineries.

Switzerland primary energy consumption

0

2

4

6

8

10

12

14

mn toe2005 2015



TurkEy









LPG Imports ('000t) 3,133 3,461



Domestic 801 816

Agriculture - -

Industry 146 176


Refinery - -

Chemical 51 165


Autogas







• Turkey has become the powerhouse of the eastern Medi-terranean region, with strong LPG demand soaking up sup-ply both from the Black Sea and Mediterranean markets.

• The country's consumption rose by a strong 10.8pc to 4.25mn t in 2015, dominated by the massive 3.09mn t/yr autogas sector.

• Household demand has contracted in recent years, but regained lost ground in 2015, rising to 816,000t.

Turkey primary energy consumption

051015202530354045

mn toe2005 2015

uk




Share of rural population (%) 18 17



From gas processing 958 1,093





Domestic 229 252

Agriculture 89 90

Industry 581 637

Transport 88 82

Refinery - -



Autogas







• The UK's domestic and industrial sectors rebounded in 2015 — with both recording demand gains of 10pc — after a difficult 2014, in which mild weather led to a significant drop in consumption. Demand in the petrochemicals sector was also very high, as LPG's price advantage over naphtha offered buyers high value throughout the year.

• The additional supply requirements were covered by a 7pc increase production and an 89pc jump in imports from Europe and the US to 798,000t.

uk primary energy consumption

0102030405060708090

mn toe2005 2015



UkrainE






From refinery 71 65






Domestic 55 52

Agriculture 10 10

Industry 40 35

Transport 950 1,050

Refinery - -

Chemical - -


Autogas





New Vehicle Registration (000's) 97


• Ukrainian LPG consumption rose by 8.7pc year on year to reach 1.15mn t in 2015.

• The majority of demand was from the country’s ever-growing autogas market. Consumption exceeded 1mn t for the first time in 2015, as autogas vehicle registrations surged and the retail network expanded to 3,500 outlets.

• The autogas fleet is now a massive 2mn vehicles — almost as large as the well-established Italian market.

Ukraine primary energy consumption

0

10

20

30

40

50

60

70

mn toe2005 2015



LPG DiStributiOn chain

Oil and gas production Onshore

Oil and gas production Offshore

NGL processing unit

Crude oil/gas/NGL stream

Crude oil tanker Pipeline Refrigerated LPG carrier Pipeline Rail tank car

Refrigerated or pressurised storage

terminal

Underground storage terminal

Pressurised LPG tanker Rail tank carBulk road tank carPipeline

Domesticcooking and

heating

Agriculture

Service station

Bulk sub-depot

Bulk distributor Bulk road tank car Piped natural gas Light industrial

Petrochemicals plant

Cylinder retailer/dealer

Autogas vehicle

Bulk road tank car

BBQ, campinglighters and lawnmowers

BoilersForklift trucks

Crop dryersWeed-killers

Town gasCity gas



MEthOdOLOGy

DefinitionsLPG: Liquefied petroleum gas including propane, n-butane, iso-butane, butane mixtures and propane-butane mixtures only. In some markets a small amount of unsaturated prod-uct may be included.

Consumption by sectors*Domestic: Includes residential and commercial use for LPG as a cook-ing and heating fuel primarily from cylinders and bulk tanks.

Agriculture: LPG use in crop drying, weed and pest control, irrigation and non-highway agricultural vehicles.

Industry: LPG consumed in manufacturing and light industrial ap-plications, such as glass-blowing, ceramics manufacture, welding, food processing and heating for boilers. Some volumes in the commercial sector may be included.

Autogas: Use as automotive vehicle fuel in passenger cars, taxi fleets, company vehicle fleets, buses, light trucks but excluding forklift trucks.

Refinery: LPG used as a feedstock for crude oil refining processes or as a fuel at refineries.

Chemical: LPG used as a feedstock for olefins production and other chemical processes. Some feedstock use in refineries may be included.

*A comprehensive resource on the over 1,000 applications of LPG can be found at the WLPGA’s global portal on LPG Ap-plications, found at http://www.lpg-apps.org.

VLGC: very large gas carrier.LGC: large gas carrier.NGL: natural gas liquids

LPG Properties

Property Propane (C3H8) Butane (C4H10)

Liquid density 0.50-0.51 0.57-0.58

Gas density/Air 1.40-1.55 1.90-2.10

Ratio Gas/Liquid 274 Vols 233 Vols

Boiling Point -45°C -2°C

Latent Heat Vaporisation 358 Kj/kg 372 Kj/kg

Specific Heat Liq 0.60 Btu/ft³ 0.57 Btu/ft³

Sulphur Content 0-0.02% 0-0.02%

Flammability Limit 2.2-10.0% 1.8-9.0%

Calorific Values 2,500 Btu/ft³ 3,270 Btu/ft³

21,500 Btu/lb 21,200 Btu/ib

11,900 Kcal/kg 11,800 Kcal/kg

50.4 Mj/kg 49.5 Mj/kg

Minimum ignition temp. 460°C 410°C

Useful Conversion Factors

Propane (C3H8) Butane (C4H10)

USG/t 521 458

Imperial gallons/t 433 381

litres/t 1,968 1,732

Therms/t 474 465

b/t 12 11

t/m³ 0.582 0.600

1t of LP Gas = 1.18t of oil equivalent

1 nautical mile = 1.85km

LPG properties and conversion factors

Common Units of MeasurementBarrels: blCubic feet: ft³Cubic metres: m³ Litres: lTonnes: t Tonnes of oil equivalent: toeUSG: US gallons



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EUROPEAN LPG SECTOR OVERVIEW 2016Argus MediaEditorial team (London):Nick Black, Principal LPGDavid Appleton, Senior Analyst

[email protected]

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