This session gives you an overview of the industry value chain which serves as background for the rest of our course. Find out:
- Definitions, physical properties, and primary uses of NGLs (and LPGs).
- Market characteristics of the NGL/LPG markets and how they differ from refined products and crude. See how these differences affect how money is made and spent in this dynamic part of the business.
- Overall supply/demand balances.
- Key drivers of supply, demand, and price.
- Primary uses of NGLs in the U.S. and how this differs from the global market.
- Where margin opportunities are greatest.
This session reviews the production process for gas liquids/LPG sourced from refining operations. It provides an overview of crude oil refining that includes:
- How much total LPG supply comes from refining.
- The process flow diagram for a basic refinery – find out which units produce LPGs.
- How refinery netback values for LPG sales are affected by their storage and shipment options.
- How to forecast refinery LPG volumes.
- The difference between government statistics and what happens “inside the refinery fence.”
- Why refinery fuel balances matter to propane traders.
Discussion of refinery LPG continues in this session with a closer look at butanes and natural gasoline. Discover:
- How changes in motor gasoline specifications can change demand for butanes and natural gasoline, both seasonally and in total.
- Why petrochemical demand for butanes is relatively small compared to other NGLs.
- Why isobutane marketers watch propylene prices.
- Factors which affect natural gasoline demand.
- The basics of gasoline blending economics.
In this session, find out how natural gas is located, extracted and produced. Key topics include:
- Why understanding natural gas supply economics and volumes is important to forecasting NGLs.
- An overview of the natural gas value chain from initial survey to production.
- Types of gas – all methane is not created equally! Learn the difference in NGL yield for different types of gas and why coalbed methane isn’t the same as what’s usually found in oil reserves.
- The players – who owns the gas and why it is important to an NGL marketer.
- Why NGLs are produced and how “merchantability” and “dewpoint” clauses in gas pipeline tariffs affect liquids extraction at gas plants.
- How increasing LNG imports may impact NGL supply in the U.S. markets.
Natural gas processing in “stand-alone” gas plants produces most of the ethane feedstock used in the petrochemical industry as well as the majority of North America’s gas liquids supply. Understanding the gas “midstream” business is critical to forecasting your product supply and costs. This session covers:
- An overview of gas processing – how it differs from crude oil refining.
- Process technology – gas processing plant profitability depends on the type of raw gas to be handled, the gas quality specifications for the pipelines downstream of the plant, and liquids market. How do these factors affect the plant’s profitability for different types of plants?
- Learn the economics of ethane recovery, how plant operators decide whether or not to produce ethane at a given location, and the impact this can have on downstream facility operators.
- Processing contracts – how the terms can differ among regions and for different types of gas (includes examples of how plant profitability differs depending on gas quality and contract terms).
Gas liquids production occurs in the field, but most of the markets are concentrated in industrial areas. This session addresses the logistics of moving the “raw” NGL stream from the production point to hub locations for separation into finished products and delivery to end users. You’ll learn:
- The difference between local fractionation and hub processing in the fractionation process.
- An overview of the pipeline systems that gather and move NGLs to the market.
- The opportunities and risks for owning downstream logistics assets.
Most NGLs are moved to market hub locations for fractionation and storage. The facilities for handling and storing large volumes of gas liquids are quite different from those in the refining business. Not knowing these limitations can be costly to a new trader or marketer. This session provides:
- A complete overview of the fractionation process.
- Descriptions of the major hub locations and the differences between markets and companies at each location.
- Why logistics determine the difference between “prompt,” “any” and “wet” barrels.
- Why inventory reports don’t tell the whole story of the NGL markets.