American Ethane Inks Deal to Provide 2.5M Tons of Ethane Yearly to Major Chinese Company

Earlier this month, American Ethane Company reportedly signed a definitive 20-year take-or-pay fuel sales agreement to supply annually 2.5 million tons of ethane to Nanshan Group, according to sources with knowledge of the agreement.

The volume of ethane in the reported contract with Nanshan Group will include eight Very Large Ethane Carriers to be built for the annual delivery.

Deliveries are expected to begin in 2020 upon completion of infrastructure in the U.S. and China. According to a source, Nanshan is in the development of an ethane cracker to produce ethylene, a feedstock for plastics.

American Ethane, a private Texas-based company, has been in development of an ethane export terminal on the Gulf Coast with an annual export volume of 10 million tons of ethane.

American Ethane is marketing ethane the Asian markets for power generation and as a petrochemical feedstock.

John Houghtaling, the CEO of American Ethane was contacted about the reported contract. He stated, “I can confirm that America Ethane has signed a definitive 20-year contract for a 2.5 million ton volume of ethane to an entity in China, but the specific terms of the deal are covered under a confidentiality agreement, and I, therefore, can make no further comment at this moment.”

Nanshan Group is a multinational company reported to be ranked 167th on the top 500 companies list in China. In 2011, Nanshan subsidiary opened an aerospace aluminum factory in Indiana.