The NGL business is one of the most logistically complex segments of the energy industry. To really make sense of it you need to step back and look at the big picture. That’s exactly what our new U.S. NGL Infrastructure Map provides — a comprehensive view of the entire NGL value chain.
The NGL business is one of the most logistically complex segments of the energy industry. To really make sense of it you need to step back and look at the big picture. That’s exactly what our new U.S. NGL Infrastructure Map provides — a comprehensive view of the entire NGL value chain.
Even if Permian crude oil production were to stagnate over the next few years, the region’s output of NGLs would likely increase by half, from the current 3.2 MMcf/d to about 4.8 MMcf/d in 2030. Anticipating that growth, NGL midstreamers are planning new NGL pipeline capacity from West Texas to the Gulf Coast.
Phillips 66’s Sweeny Complex includes refining, midstream and petrochemical units and illustrates how a well-designed facility can deliver operating and financial efficiencies.
It finally happened. And it’s a very big deal for MPLX and ONEOK, both of which have been working for years to become full-fledged members of the elite “NGL wellhead-to-water club.” But the companies’ announcements that MPLX will build two fractionators at the terminus of a new NGL pipeline from Sweeny to Texas City and that ONEOK and MPLX will joint build a new LPG export terminal nearby (and a new purity-product pipeline between Mont Belvieu and the terminal) doesn’t just fill in the missing pieces of the puzzle they’ve been assembling. The plans also will give Gulf Coast LPG exporters the additional capacity they desperately need and — no small thing — create another fractionation hub. In today’s RBN blog, we discuss what MPLX and ONEOK are planning and why it matters.
It finally happened. And it’s a very big deal for MPLX and ONEOK, both of which have been working for years to become full-fledged members of the elite “NGL wellhead-to-water club.” But the companies’ announcements that MPLX will build two fractionators at the terminus of a new NGL pipeline from Sweeny to Texas City and that ONEOK and MPLX will joint build a new LPG export terminal nearby (and a new purity-product pipeline between Mont Belvieu and the terminal) doesn’t just fill in the missing pieces of the puzzle they’ve been assembling. The plans also will give Gulf Coast LPG exporters the additional capacity they desperately need and — no small thing — create another fractionation hub. In today’s RBN blog, we discuss what MPLX and ONEOK are planning and why it matters.
Since 2011, U.S. natural gas liquids (NGL) production has more than tripled, while domestic demand has grown only modestly. Consequently, the only way NGL markets could balance was a dramatic increase in exports. Today, over 70% of U.S. propane production is exported, with the majority going to overseas markets, while other NGLs see varying export levels: 40% for butanes, 25% for natural gasoline, and 18% for ethane. Although U.S. NGL production growth is slowing, we still project an increase of 1.5 MMb/d over the next decade and a half, with 85% of that growth coming from the Permian Basin. As U.S. ethane and LPG production continues to rise, nearly all the export growth is expected to head to the Asia/Pacific region, with a significant portion going to one country: China. But is this outlook for U.S. NGLs realistic? And do we have adequate infrastructure — ranging from gathering systems to processing plants and fractionators, and from export terminals to the right kind of ships — to handle all of these volumes? In one of his hit tunes, Toby Keith clearly identified the problem for us: “Where You Gonna Go? And What Ya Gonna Do When You Get There?” These are key NGL market themes that we'll be exploring at our upcoming NACON conference on October 24 at the Royal Sonesta Hotel in Houston and that we’ll introduce in today’s RBN blog.
Crude-oil-focused production in the Bakken still hasn’t fully recovered from its pre-COVID high, partly because the western North Dakota shale play continues to face takeaway constraints, especially for natural gas and NGLs. A couple of NGL pipeline projects in the works will certainly help, but will they be enough to enable the Bakken’s increasingly consolidated E&P sector to ramp up its crude oil production? And one more thing: How will the incremental NGLs flowing south on Kinder Morgan’s soon-to-be-repurposed Double H Pipeline find their way to fractionation centers in Conway and Mont Belvieu? In today’s RBN blog, we’ll look at the Bakken’s complicated production-vs.-takeaway conundrum and the ongoing efforts to address it.
Mont Belvieu, TX and Conway, KS, are the two most significant U.S. hubs for NGL trading, storage and fractionation, with the much bigger Mont Belvieu hub primarily serving Gulf Coast and export demand, while the smaller Conway hub is focused on Midwest/Great Plains demand, especially for propane. The pricing dynamics between the two hubs are a key indicator of the supply/demand balance between the regions, but they don’t have the same kind of influence over the direction or magnitude of flows as price differential dynamics often do for other energy commodities. In today’s RBN blog, we will examine the gap between the price of the NGL “basket” in Mont Belvieu versus Conway and what that price spread tells us.
Energy Transfer’s plan to buy WTG Midstream, a West Texas-based and private equity-backed natural gas gatherer and processor, just got a bit less expensive — and not quite so comprehensive. Energy Transfer will still acquire WTG’s network of more than 6,000 miles of gas pipelines, eight processing plants and more, but WTG’s 20% stake in the joint-venture (JV) BANGL pipeline system is no longer part of the deal. In today’s RBN blog, we’ll take a look at the detour from the original transaction.
