US Department of Energy publishes NGL primer report

January 19, 2018 By    

The U.S. Department of Energy (DOE) published a natural gas liquids (NGL) primer, showcasing the resource potential of NGLs, specifically in the Appalachian region.

According to DOE, the data outlined in the primer was gathered from the most recent information available from DOE and the U.S. Energy Information Administration (EIA) on Appalachian NGL supply, demand and infrastructure.

The primer reports the Appalachian region has experienced near-exponential growth in natural gas production, and that production is expected to increase for decades to come. EIA forecasts that natural gas production in Appalachia will increase over 350 percent from 2013 to 2040. In addition, NGL processing and fractionating capacity in Appalachia has grown quickly to match this increase in natural gas production.

The natural gas produced in Appalachia contains valuable resources in the form of NGLs, including ethane and propane, according to DOE. When separated from the natural gas stream, ethane and propane are key feedstocks for the petrochemical industry to produce compounds for making plastics.

However, the Appalachian area has generally been dependent on non-local storage to satisfy peak-season NGL demand, providing market potential to the surrounding region for NGL storage and midstream infrastructure, reports DOE.

According to DOE, the primer also underscores that increased recovery of ethane, instead of rejecting it in the dry natural gas stream, presents opportunities for new downstream investments using ethane as a feedstock.

The Appalachian region is endowed with significant NGL resources projected to be economically recoverable over at least the next three decades, according to the report. This primer is an important step in preparing a requested report to Congress about the benefits of Appalachian NGLs for years to come.

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About the Author:

Joe McCarthy was an associate editor at LP Gas Magazine.

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