Bw Lpg Limited · OSL:BWLPG
Bw Lpg — IHS Conference Marrakesh (September 2017)
14 slides from Bw Lpg's conference presentation, September 2017
Slide 1: Back To The Future… Business Update
September 2017 Section 1 ‘Back To The Future…’ Business Update BW LPG – IHS Conference Marrakesh
Slide 2: Global LPG Liftings
Global LPG Liftings Following a period of rapid growth, driven by US production, global seaborne exports have grown 2% YoY Strong seaborne LPG growth over the last 6 years has slowed As Middle East production slows in 2017, while USA continues growth Global LPG Liftings (Mt) Exports by Major Exporti
Slide 3: Centres of Production
Centres of Production The US has become the second largest exporter of LPG, and the largest in terms of tonmiles generated The USA drove growth both in export tons & tonmile terms With tonmiles increasing 78% CAGR over six years Share Of Global Liftings Global LPG Ton Miles (Billions) USA Middle Eas
Slide 4: US Exports & Inventories
US Exports & Inventories Historically low US LPG inventories must be rebuilt before the winter heating season and drawdowns begin The Far East has taken a greater share of increased US LPG exports But low U.S. LPG inventories must be built before winter heating season Destination of USA Exports (Mt)
Slide 5: US Production Forecast
US Production Forecast Stable growth in US LPG production is expected, which should make more product available for export Following a period of 10-14% yearly production growth (2013-2016), growth of -1% and 4% are forecast for 2017 and 2018 respectively USA LPG Production (Mt) - September EIA Short
Slide 6: US Domestic Prices & Arbitrage
US Domestic Prices & Arbitrage Low inventories, slower production growth and robust demand drove US LPG prices to historical highs Flatter production growth & strong exports firmed domestic prices resulting in spreads deteriorating in Q1 2017 and remaining low into Q3 Mont Belvieu Propane as % of WT
Slide 7: US Production
US Production Strong potential upside for US LPG production, with Shale plays expected to drive future growth LPG production growth has consistently outperformed crude and nat gas Driven by shale, which has a higher NGL content than traditional plays USA YoY Hydrocarbon Production Growth US Natural
Slide 8: Centres of Demand
Centres of Demand China presented the largest growth market for LPG imports, amid robust LPG demand in India China showed strong YoY import growth of 16% driven by PDH demand Indian imports increased for inventory building and retail demand China LPG Imports (Mt) India LPG Imports (Mt) 2016 2017 201
Slide 9: Centres of Demand (Continued)
Centres of Demand (Continued) South Korea & Japan showed flat demand growth in 2017, reflecting mature LPG markets South Korea imports were high in Q1 2017, driven by inventory restocking however, Korean and Japanese import demand is flat in 2017 South Korea LPG Imports (Mt) Japan LPG Imports (Mt) 2
Slide 10: China LPG Demand Structure
China LPG Demand Structure China shows strong petrochemical demand growth, supported by robust residential and commercial demand Total Chinese LPG demand is forecast to grow 10% in 2017 Further demand growth cannot be met solely by Middle Eastern exports Commenced & Planned Chinese PDH Plant Project
Slide 11: China Petrochemical Demand
China Petrochemical Demand Despite high delivered LPG prices, petrochemical margins remain strong, supporting further demand growth In 2016, propane & propylene prices diverged, improving PDH margins Despite high propane prices in 2017, margins remain strong Forward Asia Propane & Propylene Prices (
Slide 12: Indian LPG Demand Structure
Indian LPG Demand Structure Retail demand should increase with improved infrastructure and accessibility Retail demand Retail demand dominates dominatesdomestic domesticconsumption consumptionininIndia India And should And shouldincrease increasewith withgoveernment government support for LPG suppor
Slide 13: VLGC Fleet Profile
VLGC Fleet Profile Significant newbuilding deliveries continue into 2017, delaying supply rebalancing into 2018 In 2015 & 2016 fleet growth was 21%, exceeding demand growth though supply & demand can rebalance once deliveries ease after 2017 VLGC Yearly Fleet Development VLGC Quarterly Orderbook 60
Slide 14: Marine Bunker Market
Marine Bunker Market Facts & figures behind the IMO 2020 Sulfur Regulation ✓ 3.8mbpd – 2016 marine bunker demand ✓ 4% – bunker demand as a % of global oil demand of 96mbpd ✓ 40% – middle distillates as a % of global oil demand ✓ 80% – fuel oil (~3% sulfur) as a % of total bunker demand ✓ 20% – gasoi