Yesterday the price of ethane in E/P mix in Conway dropped again, now down to 14.5 cnts/gal, or $6.09/Bbl. A lot of the ethane barrels that move down the ONEOK Overland Pass NGL pipeline from Opal, WY to Conway, KS get priced out based on Conway ethane numbers. We talked about this situation last Wednesday in Not Gonna Lie.
Purity non-TET ethane in Mt. Belvieu, TX held up at 46.1 cnts/gal, or $19.36/Bbl. Still this is about half of the Mt. Belvieu price in January 2012. So ethane prices are down. What does this mean for producers and gas processors? Moreover, ethane supply is projected to increase by more than 50% over the next five years. That’s a lot of ethane. Which will probably crush the price. Will that kill the wet gas goose that is laying all the golden eggs? We better look at the numbers carefully.
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