Tag Archives: NGL

Enterprise Products Partners to build new natural gas facility and pipelines – HBJ

Houston-based Enterprise Products Partners LP (NYSE: EPD) continues to expand its natural gas footprint as natural gas production and piping continues to grow in the U.S.The midstream energy company announced June 20 it plans to build a cryogenic natural gas processing facility — its third facility announced in less than 24 months — as well as additional natural gas and natural gas liquids pipelines.  Enterprise’s target: the NGL-rich Delaware Basin in West Texas and southeastern New Mexico. The facility’s site hasn’t been determined, but the plant is expected to have a nameplate capacity of 300 million cubic feet per day and extract more than 40,000 barrels of NGL daily. The facility is expected to start up in the second quarter of 2018.The project also includes building rich natural gas gathering lines, a residue pipeline to Texas’ Waha oil field and an NGL pipeline to Enterprise’s Mid-America Pipeline system, all of which will integrate with Enterprise’s Delaware Basin infrastructure.“The South Eddy facility began operations earlier this year, while our joint venture processing plant at Waha is expected to begin service in the third quarter of 2016,” A.J. “Jim” Teague, CEO of Enterprise’s general partner, said in the company’s statement. “Altogether, these initiatives are expected to increase our processing capacity in the Delaware Basin to 800 MMcf/d, compared to 40 MMcf/d in 2012.”Enterprise is the fourth-largest Houston-based public company, based on its $47.95 billion in revenue in 2014, according to Houston Business Journal research. It reported nearly $27.03 billion in revenue for 2015.

Source: Enterprise Products Partners to build new natural gas facility and pipelines – Houston Business Journal

Chesapeake Energy And Others’ Feasibility Increases Production Of Natural Gas Liquids

he production for Natural gas liquids or NGLs for short is rising high. The EIA or Energy Information Administration of the U.S. estimated in their latest report, that the NGL plants would increase the production of HGLs or hydrocarbon gas liquids to 3.2 MMBbl/d this year.  In their recent report called Short-Term Energy Outlook or STEO, EIA explained that the production goes up from 2.6 million barrels per day, two years ago to the aforementioned quantity in 2015. In 2016, this is estimated to be 3.5 million bbl/ d. NGL makes it easy to drill out wet gas. This activity is most feasible for companies like Chesapeake Energy Corporation (NYSE:CHK).

via Chesapeake Energy Corporation (NYSE:CHK) And Others’ Feasibility Increases Production Of Natural Gas Liquids – USMarketsDaily.

Energy Transfer Eyes Texas, Appalachia Growth in Regency Merger, will become second-largest MLP in the United States

Energy Transfer Partners LP (ETP) and affiliate Regency Energy Partners LP on Monday agreed to merge in a transaction estimated to be worth $18 billion, creating one of the largest master limited partnerships (MLP) with operations in nearly all major producing areas of the United States.

Set to close by the end of June, the transaction includes a one-time cash payment to Regency unitholders and $6.8 billion in debt and liabilities. The combination would create the second-largest MLP in the United States after Kinder Morgan Energy Partners LP.

“ETP and Regency expect to capitalize on the full breadth of the combined gathering and processing platforms in several prolific producing regions, including the Permian Basin and Eagle Ford Shale,” management said. ETP altogether controls about 35,000 miles of natural gas and natural gas liquids (NGL) pipelines.

Among the benefits of the Regency merger “is the likelihood” of further NGL volume growth in Texas for their joint venture, Lone Star NGL LLC, which is expanding volumes into ETP’s intrastate pipeline system (see Daily GPI, Nov. 17, 2014).

Appalachia business also is seen benefiting with the merger, where Regency’s growing operations are seen as a complement to ETP’s 3.25 Bcf/d Rover pipeline now under construction (see Shale Daily, Oct. 31, 2014; Oct. 11, 2013).

“The presence of ETP and Regency in these shales will also be complemented by the significant activity of Sunoco Logistics Partners LP, another member of the Energy Transfer family, as it builds on its asset base in that area,” ETP management noted. ETP purchased Sunoco in 2012 (see Shale Daily, May 1, 2012). “Overall, ETP intends to become a major player in the Marcellus and Utica shales,” and said the Regency merger positions it to achieve that goal in the near term.

For Regency, the deal provides more financial assurance in uncertain times.

via Energy Transfer Eyes Texas, Appalachia Growth in Regency Merger | 2015-01-26 | Natural Gas Intelligence.

Is Wall Street Overlooking NGL Price Impact on US Oil & Gas Producer Earnings?

When supplies of dry US natural gas swelled several years ago as companies honed their shale resource development skills, gas prices dramatically declined hitting a low of about $2 per million BTU. This caused natural gas producers to shift drilling operations into more liquids-rich areas and adjust their production more toward oil, which fetched higher prices at the time.

Traditionally gas-focused operators were able to contend with lower dry gas prices by producing more natural gas liquids, which are used as feedstock by refiners, petrochemical manufacturers and other industrial concerns. “The surge in natural gas liquids (NGLs) supply accompanying US shale production has notably underpinned the domestic petrochemicals industry with cheap plant feedstock, particularly in the form of ethane. This has allowed US plants to forge a competitive global position in ethylene production and ushered in a new era of investments in the US petrochemicals sector,” according to a recent Oxford Institute for Energy Studies report.  Some companies like Range Resources struck NGL export agreements with European chemical companies.

But the recent oil price decline has brought down NGL prices as well, and brokerage Sterne Agee suggests NGL pricing weakness may drag on earnings more than the Street expects. “While oil price action continues to dominate headlines, the steep decline has been pervasive across the entire hydrocarbon complex.” … “With 4Q earnings beginning this week for some large cap E&Ps, we expect NGL price weakness to weigh on 4Q results, possibly more so than many expect, especially given limited hedging options for the NGL components,” Sterne Agee analysts said in a note today.

via Is Wall Street Overlooking NGL Price Impact on US Oil & Gas Producer Earnings? « Breaking Energy – Energy industry news, analysis, and commentary.

One Bright Spot Amid A Slew Of Canceled Energy Projects

As energy companies large and small abandon new capital spending projects, one initiative – albeit a relatively small one – remains on the table.

Ashtabula Energy, a Houston-based division of Velocys Inc., plans to build a $200 million refinery that would convert natural gas to liquids in Ashtabula in northeastern Ohio, on the shore of Lake Erie and has applied for a permit to do so by the Ohio Environmental Protection Agency.

The plant, situated on an 80-acre site that once was part of the industrial city’s Union Carbide factory, would convert 2,800 barrels of gas into liquids each day. The Ohio EPA says that if approval is granted, Ashtabula Energy would be permitted dump 1.6 million gallons of waste water each day into the lake, having “minimal impact on the water quality of the lake.”

Pinto Energy proposed building the plant in 2013, but the company was soon bought by Velocys, a British company that moved its operations to Houston at the time to enter the U.S. market. Velocys says the project will mean 400 temporary jobs to build the plant, which should be completed by the end of this year, and result in 30 permanent jobs in Ashtabula.

And the project can grow with demand, according to Guy Dove, chairman of Pinto Energy. “The site we have is actually large enough to build facilities to total 7,000 barrels per day,” he said.

The company says it will use a chemical process called Fischer-Tropsch to convert natural gas into various liquid fuels that are more profitable – for example diesel, which is eight times more expensive than natural gas.

via One Bright Spot Amid A Slew Of Canceled Energy Projects.

An analysis of recent propane inventory movements – Market Realist

Propane is a natural gas liquid (or NGL). NGLs are hydrocarbons in the same family of molecules as natural gas and crude oil. Other NGLs include ethane, butane, and pentane. Propane and ethane in particular are both important feedstock for chemical plants. Around 5% of all American homes use propane as a heating fuel. So it’s important for investors to monitor propane prices.Propane prices affect propane distributors such as Ferrellgas Partners (FGP), Suburban Propane Partners (SPH), AmeriGas (APU), and NGL Energy Partners (NGL). Most of these companies are components of the Global X MLP ETF (MLPA).In the last week of December, residential propane prices averaged ~2.37 per gallon, which was $0.01 less than the prior week and $0.43 less than the price at the same time the year before. This is a big change from last year when prices spiked as supplies dwindled due to a cold winter.

via An analysis of recent propane inventory movements – Market Realist.

U.S. Energy Information Administration EIA

Drilling Productivity Report

via U.S. Energy Information Administration EIA.

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.

Torrent Energy Services Partners with CSL Capital Management

Torrent Energy Services, LLC “Torrent” and CSL Capital Management “CSL” are pleased to announce they executed definitive agreements that will provide Torrent with growth capital to accelerate its business plan. Torrent offers modular gas processing equipment and services that allow oil and gas producers and midstream companies to recover valuable natural gas liquids NGLs while reducing flaring and emissions.Torrent leases and operates mechanical refrigeration units MRUs based on tried and true technology. Built new, Torrent’s skid-mounted plants are capable of processing very rich natural gas and have the mobility to rapidly respond to customer needs, even in the most extreme weather conditions. Torrent’s plants convert heavy hydrocarbons C3+ into a stabilized, truckable, Y-Grade NGL product. The clean residue gas — primarily methane and ethane — is used to fuel ancillary equipment, including natural gas generators and compressors also provided by Torrent. Any remaining gas can be gathered or flared with a reduction in VOC emissions of 70 percent or more, allowing customers to meet permit requirements.Torrent is active in multiple regions including the Bakken Shale, Permian Basin, California, Utica Shale and Piceance Basin. Torrent is an established leader in North Dakota’s Bakken Shale, where the company helps multiple customers meet the state’s new gas capture requirements.

via Torrent Energy Services Partners with CSL Capital Management – MarketWatch.

Warburg Pincus leads $600M investment in Zenith Energy, a Houston energy startup

A new Houston energy company focused on terminals and storage is forming with the financial backing of a top New York-based global private equity firm.Warburg Pincus LLC is leading a $600 million investment to support the formation of Zenith Energy in Houston, to be led by Jeffrey Armstrong, who most recently headed corporate strategy at Houston-based Kinder Morgan Inc. NYSE: KMI.

via Warburg Pincus leads $600M investment in Zenith Energy, a Houston energy startup – Houston Business Journal.