Supplies of natural gas liquids, especially propane, have become increasingly tight in recent months, with prices reaching multi-year highs in the U.S. and Canada. Despite the strong price signals, increasing production is typically a lengthy, complex, and expensive process involving producers drilling new wells to yield more liquids-rich natural gas and crude oil. There is also another way to increase supplies: by extracting them from already processed and pipelined natural gas via a straddle plant that more intensively recovers additional NGLs, such as propane, from the existing gas supply. Canada’s Wolf Midstream has recently sanctioned such a plant, as well as a related pipeline and extraction plant in Alberta that it hopes to bring into service in 2023. In today’s blog, we examine this new straddle plant and Western Canada’s current propane supply situation.
Visualize the infrastructure behind U.S. NGL movement.
The U.S. NGLs Map provides a comprehensive view of the transport, processing, and export networks moving NGLs across the U.S.
The prices of natural gas liquids (NGLs) such as propane and butane have been sky-high in recent months. Strong demand, driven by recent winter extremes and the pull of Asian petrochemical customers, has been bumping up against slower-to-respond supplies, resulting in lower inventories and supporting very strong pricing. We emphasized these tight market conditions recently in Running on Empty, where we highlighted the fact that record LPG U.S. exports to many of those same propane-hungry Asian customers have resulted in multi-year seasonal lows for U.S. propane stocks this month. With the pull of overseas prices so compelling, U.S. propane exports look set to continue to contribute to a tight U.S. propane market for at least the remainder of this year.
Of course, Canadian NGL prices have not been immune to the pricing frenzy, with propane and butane prices at the Edmonton, AB, hub also at some of the highest seasonal levels seen in many years. Recent propane prices, at just under $1.00/gallon (blue line, left graph in Figure 1), are more than four times higher than where they were just one year ago (black line) when slack exports to the U.S. created local oversupply conditions. Based on pricing history from OPIS, current propane prices are the highest for August since 2013. It’s a similar story for butane prices in 2021 (blue line, right graph in Figure 1), which are also well above their year-ago level and the highest August prices since 2014.
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About the song
“Hold On, I'm Comin'” was written by Isaac Hayes and David Porter, and was released as a single by the soul duo of Sam & Dave in 1966. Hayes came up with the title of the song spontaneously when he was trying to get Porter to hurry out of the Stax Studios restroom and get back to songwriting, and Porter replied, “Hold on, I’m comin’.” Personnel on the record were: Sam Moore and Dave Prater (vocals), and Booker T & the MGs and the Mar-Keys Horns (instrumentation).
The single peaked at #1 on the Billboard Hot R&B Singles chart and #21 on the Billboard Hot 100 Singles chart. A revamped version of the song, "Hold On, Edwin's Coming," was recorded by Sam & Dave in 1982 as a promotional single for Louisiana Governor Edwin Edwards’s re-election campaign. “Hold On, I’m Comin’” also has been covered by a number of other recording artists, including Aretha Franklin on her 1981 album, Love All the Hurt Away, and Eric Clapton and B.B. King on their 2000 LP, Riding With the King.
Sam & Dave were an American soul and R&B duo who performed together from 1961 to 1981. Sam Moore (a tenor) and the Dave Prater (a baritone/tenor) were nicknamed "Double Dynamite," "The Sultans of Sweat," and "The Dynamic Duo" for their gritty, gospel-infused performances, and are considered one of the greatest live acts of the 1960s. Except for Aretha Franklin, no soul performers in that era had more consistent R&B chart success, including 10 consecutive Top 20 singles and three consecutive Top 10 LPs.
Sam & Dave won a Grammy Award for another hit single, “Soul Man,” and a Grammy Lifetime Achievement Award in 2019. The duo has been inducted in the Rock and Roll Hall of Fame, the Vocal Group Hall of Fame, the Memphis Music Hall of Fame, and the Rhythm & Blues Music Hall of Fame. Dave Prater died in 1988.
