Genscape Predicts Large Growth in Permian NGL Production

The production of natural gas liquids NGL in the Permian Basin will take off over the next several years as producers shift focus to liquids-rich shale plays and midstream companies follow their lead and build the necessary infrastructure to process and transport the liquids, according to an executive with Genscape Inc.In a five-page white paper, Bob Simmons, Genscape NGL product manager, said the firm believes NGL production in the Permian is on pace to increase by about 50,000 b/d in 2014, and by about 250,000 b/d by the end of 2018. Propane is expected to account for the largest share of the growth and is forecast to be 39% higher by the end of 2018.”New published information not only continues to support the growth trend forecasted but has led to Genscape revising the forecast higher over the past couple of months,” Simmons said. But he added that ethane rejection “is expected to persist into 2017 due to the lack of infrastructure to consume the molecule. The timing for when ethane’s production growth rate is expected to increase is dependent upon the completion of ethylene cracker projects and [U.S. Gulf Coast] export terminals.”Simmons said there has been strong producer and midstream activity in the Permian this year, with the former deploying an additional 141 horizontal rigs in the play so far this year, a 76% increase from the year prior. He said horizontal rigs now make up more than 60% of the rigs targeting the basin.”Producers are targeting numerous stacked shale plays with their horizontal drilling programs, which are yielding a high liquids content,” Simmons said. “Initial well tests that have been published have resulted in 5-6 gallons/Mcf of NGL. Historically, yields are 2-3 gallons/Mcf.”

via Genscape Predicts Large Growth in Permian NGL Production | 2014-10-09 | Natural Gas Intelligence.

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