OREANDA-NEWS. Phillips 66 said it expects its 150,000 b/d LPG export terminal in Freeport, Texas, to be operational in the third or fourth quarter of 2016.

The associated 100,000 b/d Sweeny, Texas, fractionator to support the terminal will be operational by the end of this year.

"These are fee-based commitments in large part on both the terminal and the fractionator," chief executive Greg Garland said on an earnings call today, without specifying what percentage is contracted.

A glut of US NGL production led to a surge in exports and new terminal projects. The arbitrage between the US and other markets narrowed earlier this year but is widening in the fourth quarter as US prices remain weak. The company is also investing in new petrochemical projects to take advantage of cheap ethane feedstock.

CPChem's new ethylene cracker and associated derivatives units on the US Gulf coast are 60pc complete with operations expected to begin in mid-2017, Phillips said.

Phillips 66 expects its global olefins and polyolefins units to operate at mid-90pc capacity this quarter.

"The utilization rates continue to be fairly good. We don't see excessive inventory at the converter level, and we continue to see good demand from Asia," president Tim Taylor said. "What we see with fuels and chemicals tells us the consumer side of China is doing very well in supporting demand. Basic petrochemical margins continue to tighten but will be offset with the spread between ethane and naphtha, which keeps the cost advantage in US and Mideast, it's narrower but still there."