By Arathy Somasekhar and Georgina McCartney
HOUSTON, June 4 (Reuters) - Enterprise Products Partners ( EPD )
said on Wednesday it received notice that the U.S.
Commerce Department intends to deny its requests to export three
proposed cargoes of ethane, totaling around 2.2 million barrels,
to China.
The U.S. and China are locked in an ongoing trade war after
U.S. President Donald Trump imposed sweeping tariffs in early
April.
Pipeline and terminal operator Enterprise said last week
that its ethane and butane exports could be hurt by a Department
of Commerce requirement that it apply for a license to export to
China. The company is one of the top U.S. handlers of ethane and
butane through its port terminals.
The Bureau of Industry and Security, an agency of the
Department of Commerce, informed Enterprise in a letter two
weeks ago that exports of ethane and butane pose an unacceptable
risk of military end-use in China, according to a company
filing.
Enterprise said it has up to twenty days to respond to
the BIS's notice about the denied export cargoes with any
comments or rebuttals. Unless the company is advised otherwise
by the BIS by the 45th day after the original notification, the
denials will become final.
The BIS did not immediately respond to a request for
comment.
The U.S. last week ordered a broad swathe of companies to
stop shipping goods, including ethane and butane, to China
without a license and revoked licenses already granted to
certain suppliers.
Ethane and butane, liquids separated from natural gas, are
used to make plastics and chemicals and also for heating and
cooking.
Chinese petrochemical firms use ethane as a feedstock
because it is a cheaper alternative than naphtha, while U.S. oil
and gas producers need China to buy their natural gas liquids as
domestic supply exceeds demand.