Three of Targa Resources LPG cargoes canceled in past two months

(Reuters) Three LPG export cargoes were canceled out of Targa Resources’ Galena Park terminal near Houston, Texas in the past two months amid fluctuating Asian demand and collapsing prices.

The midstream operator received cancellation fees for the cargoes, which included one in June and two in July, executives said on the company's Q2 earnings call.

Last week, Targa's competitor Enterprise Products Partners , which operates an LPG terminal on the Houston Ship Channel, disclosed three LPG cargoes were canceled from its facility in July, and five have been canceled for August.

LPG prices have fallen sharply as a supply glut has weighed on the market and pushed the spot price for propane below levels customers previously agreed to lift cargoes under long-term contracts.

While Targa expects LPG export volumes to decline in Q3, as it allows for potential cancellations and deferrals, its guidance for exports through the end of 2016 remains on track at around 5 MMbbl per month, executives said.

Targa executives on Wednesday said the company was "well positioned relative to LPG demand fluctuations."

In June, Targa sued China Soft Packaging Group in the Harris Country District Court in Texas over allegations it failed to fulfill payments for propane purchases. Targa suffered damages of more than $1 M, its lawsuit said.

 

Reporting by Liz Hampton; editing by Grant McCool

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