This paper is dedicated to the memory of VernMillard (l924-1999), Chairman of the formerAlberta Energy Resources Conservation Board(l978-1987).

The authorgratefully acknowledges suggestions andinsights by the editor and anonymous referees. Theauthor would like also to acknowledge Marie-AnneKirsch, Bill Riley, Michael Turner, and ThornWalden ofthe Alberta Energy & Utilities Board,jortheir assistance in the preparation ofthis researchpaper.

L'auteur remercie chaleureusement flediteur et lesauteurs des recommendationspour leurs suggestionset leurs idees. L'auteur aimerait aussi remercierMarie-Anne Kirsch, Bill Riley, Michael Turner etThorn Walden du Conseil de l'i:nergie et desServices de l'Alberta pour leur aide precieuse dansla preparation de ce travail de recherche.

Dr. Abbas Naini is at the Economics and PolicyDevelopment Department, at the Alberta Energy andUtilities Board, in Calgary Alberta.

Energy Studies Review, Vol 9, No.1 1999, Printed in Canada

Natural Gas Liquids fromProduction to Consumption inAlberta - An Overview ofProcess Engineering

Abbas Naini, Ph.D.

1. Introduction

Alberta energy sector in 1997 generatedapproximately 12 billion dollars from the productionof conventional and synthetic crude oil, 9.7 billiondollars from natural gas, 4.2 billion dollars fromnatural gas liquids (NGLs), and slightly more thanhalf a billion dollars from production of coal.

Alberta has the majority of conventional crudeoil, crude bitumen (resource of synthetic crude oil),natural gas, and NGLs (ethane, propane, butanes,and pentanes plus) reserves and production inCanada.

In 1997, Alberta accounted for 100% ofCanadian ethane production, 95% ofpropane, 92%ofbutanes, and 95% ofpentanes plus production. Inthe same year, Canada produced 10.9x ofethane, 9.7X 10' m' of propane, 5,2 x 10' m' of butanes and10.5 x 10' m' m ofpentanes plus.

The majority of Alberta's energy productionincluding NGLs was shipped outside of Alberta,particularly to the US. In 1997, Alberta counted for40% of the US imports of ethane, 51 % of propane,60% of butanes and 60% ofpentanes plus.

In 1997, the US demand for ethane was 42 x 10'm', propane 70 x 10' m', butanes 32 x 10' m', andpentanes plus 20 x 10' m'. In the same year the USimported 9% of its demand for ethane, 12% forpropane, 7% for butanes, and 10% for pentanes plus.

The purpose of this paper is to describe Albertasupply sources of NGL and its uses with anoverview ofprocess engineering. In the next section,

47

the sources ofNGL supply from processing andreprocessing plants and refineries will bedescribed. In the third section, the uses ofNGLin Alberta market will be discussed. In thefourth section, export market and pipelinecapacities will be demonstrated. Conclusionswill be presented in the last section.

Appendix 1 will provide definitions oftechnical words and terms that will be used inthis paper. The sources of data are AlbertaEnergy and Utilities Board (AEUB), Statisticsnumber (ST) 13A, ST-17, and Statistics Canada,Quarterly Report on Energy Supply-Demand inCanada, 1997-IV, Catalogue number 57-003­XPB.

2. Supply of Natural Gas Liquids

Natural gas consists primarily ofmixtures ofhydrocarbon gases, predominantly methane,along with smaller amounts ofethane, propane,butanes and pentanes plus. In addition to thehydrocarbon gases, the mixture also containsnon hydrocarbons such as nitrogen, oxygen,water, carbon dioxide, hydrogen sulphide,

helium, sulphur, carbon disulphide, carbonylsulphide, and mercaptans. Removing the followingelements purifies natural gas:

Water must be removed from natural gas toprevent hydrate formations, a form offreezing inthe gas transmission pipelines.Hydrogen sulphide and carbon dioxide must beremoved since they are toxic and corrosive. Inlarger quantities, hydrogen sulphide is convertedthrough gas processing facilities to produce apure elemental sulphur product.Natural gas liquids (NGL) should be removed toserve by-products markets. NGL consists ofethane, propane, butanes (a mixed product fromisobutane and normal butane), and pentanesplus.The NGLs are recovered from three sources. Gas

processing plants or field plants which extractsNGLs from raw. Natural gas reprocessing plants, orstraddle plants which extracts NGLs frommarketable natural gas. The third source of NGLsupply is refineries which recover propane andbutanes. Figure 1 shows a simplified schematic ofnatural gas and NGL flows in Alberta.

1

----;:=====;-1-----~-------,

IAlberta Gas & I+----­NGLMarket i

"GL'

Raw IProcessing I(]a, 'i Plants I

I

CrodeOil

!

~I Oil I! Pools I

.Othe, C",adW, ........ Markets

Marketahle! Reprocessing~(]a, (MkoJI Plants 1 -!U.s. M"'h"

I I NGL, .g. I 'J!: ~i ~

!-NGLMixI- Ethane

1

- Propane

I.~~Y~~}--,~~_~,-ButanesiLRermeryI ~~~:ee 11_ Pentanes Plus

Figure 1: Simplified Schematic of Alberta Natural Gas and NGL Flows.

48

2.1 Gas Processing and Reprocessing Plants

The main products of gas processing plants(field plants) are propane, butanes, pentanes plusand sulphur. Deep-cut facilities adjacent to orwithin gas field plants (gas processing plants asused hereafter include any associated deep-cutfacilities) permit the recovery of ethane as well.

The main product of gas reprocessing plants(straddle plants) is ethane. Minor products arepropane, butanes and pentanes plus.

According to the Alberta Energy and UtilitiesBoard Report ST 98-50, there are 674 operatingprocessing plants and 8 operating reprocessingplants in Alberta.

Figure 2 shows a simplified block flow diagramof a sour gas processing plant. The first operationofthe plant occurs at the inlet separator, where theraw gas is separated into water disposal (I), sourgas (2), and sour gas condensate (3).

Sour gas (2) flow from the inlet separator ismetered and sent on for further treatment suchas sweetening, dehydration, and removal ofLPG's (propane and butanes). Sour gascondensate (3) flows to the stabilizationfacilities for removal of remaining gases andpentanes plus. Water is sent to disposalfacilities.

In the gas sweetening section, hydrogensulphide, carbon dioxide, and any smallquantities of carbonyl sulphide, carbondisulphide, and mercaptans are removed.

After sweetening, the sweet wet gas isdehydrated to reduce the water content of thegas and to eliminate the potential of hydrateformation. Then the dry gas can be used asmarketable gas, or sent to the fractionation unit.A fractionation unit is used to physicallyseparate a gaseous mixture ofhydrocarbons intoindividual products as propane, butanes, andpentanes plus.

Wateri

L..-----t Sulphurto Sales

~ Gas <. Drying and I,,--'. f-.c''''Wo;L~ !__,?S><we..etL..-.IMarlc:etable Gas~ sweeten,ing Wet Gas Liquid 1 Dry Gas

~I I Recovery i.~ ~ , I

'1 0

ilh ,(""'. Inlet ~ til IFracti~nation I==::;=i! ~~=:From Field Wells S f "0 8· ,= ....1 ; PentanesPlus

epara lOn " I " .

J! $: I, < I ""t,,,,Plu' dJW

"'" G>,

~ oBI L__-.jI-.rS;~hu;:-]-J]T"lil;"_'c_-.f-S- a-l-t -W-a-te-r' ~u; aJ"' I Sulphur :~~~r

Disposal.. Recovery

(1) P. I I~ I I

Y CondensateIS b'l' .I ta lIzahon

Figure 2: Simplified Flow Diagram of a Gas Processing Plant

49

Acid gas (H,S and CO,) from the gas sweetening unit is directed to the sulphur recovery plant whereelemental sulphur is recovered from the H,S. In this stage the range of the sulphur recovery efficiencylevel is from 95 to 97 per cent. To achieve sulphur recoveries in excess of97 per cent, the tail gas shouldmove to the "cleanup processes" such as sulpfreen. Otherwise, it moves to incinerator and stack forburning.

II Ethane [~:;...-~.,.:~~.~:r.~~!i:"~~'~>:-<;~~~"":'~12~.5~3~;;~=====~:7.86I Propane ~=".",r"_'{"'13.67l Butane n~~;;·-;':'Y.~>:":·'i-"~'12.35

IPentanes+ ITti6----"""~"·"""'''"'''·,·'",·".,N''''''',~,''".',6.13. NGL Mix* r:::'~~~~~~'~;~:i\~~~~18.09

o 2 4 6 8

I

!101

10 Processing Plants 0 ReproceSSing Plants

* A portion offuis NGL mix is fractionated outside the Alberta market into spec products.The fractionated mix is composed ofroughly 50% propane, 30% butane and 20% pentanesplus.

Figure 3: Average Extraction ofNGL to Inlet Gas Ratio at Processing and Reprocessing Plants in Alberta

Ratios of NLGs to inlet gas at processingand reprocessing plants are illustrated in Figure3.

It should be noted that gas processing plantsare the major sources of propane, butane, andpentanes plus (C3+), while reprocessing plantsare the major sources of ethane (C2).

The amount ofNGL extraction varies withthe amount of inlet gas, the liquids content ofthe gas, and developments in NGL extractiontechnology. The liquids content of natural gasmay drop over time due to decline in productionof solution gas and recycling dry gas to theexisting oil reservoirs for enhanced oil recovery.However, in Alberta the decline of liquidscontent of natural gas has been offset to someextent by Caroline gas pool (rich in C2+) whichwas discovered in 1986.

Recent developments in NGL extractiontechnology (the turbo-expander process) haveresulted in plants that can economically recoveressentially 100% propane and over 85% ethane(the early plants were designed for 85% propaneand 50-60% ethane). This means that the cost of

50

maximum NGL recovery is dropping and thatthe minimum economic plant size is declining.

2.2 Refineries

Crude oil itself has limited usefulness as anend product. It has found some direct burningapplications as a fuel in industry and electricitygeneration but generally it must be transformedinto finished products for end use.

One of the main refinery processes isdistillation. A simplified typical distillationscheme is shown in Figure 4. Distillation is thestart of the refining process where crude is splitinto a number of parts or fractions bycondensing the vapours produced when theliquid is boiled.

The separation between fractions is made onthe basis of boiling points and groups ofhydrocarbons. Over all, this split may vary,depending on the refinery configurationsystems, type of crude oil, and the desiredproducts.

Boiling RangeLess than 30'F

30'F - 320'F

Z320'F - 440'F

0>-<0::;

,CRUDE ~~ 440'F - 600'FCRUDE --l .....:li$:

I doFURNACE E-<E-<

Cfl>-<Q 600'F - nO'F

!i

More than nO'F

Figure 4: Crude Oil Distillation

ProductsLight Gas,Propane, Butan'i

Naphtha

Kerosene

Light Gas Oil

Heavy Gas Oil

Residuum

Butanes and propane collectively are known asLiquefied Petroleum Gases (LPG), are extracted atthe boiling range ofless than 30 F.

Natural gas liquids extraction from Albertaprocessing and reprocessing plants and recoveryof LPG from refining crude oil for the period of1994 to 1997 are shown in Figure 5.

It should be noted that in this figure sincestatistics do not distinguish between processingand reprocessing volume ofnon-fractionated NGLmix, the total volume ofNGL mix is shown in aseparate category.

Although, the share of refineries is notsignificant, however, the amount of butanesproduction is increasing as it is used to boostoctane levels, and improve anti-knock qualities ofmotor gasoline.

Figure 5 shows the share of specificationproductrs in 1997. In this graph, recoveredproducts contain NGL mix fractionated at thedestination point. The share of ethane hasbecome larger than other specification productsbecause of the associated deep-cut facilities.

51

3000,-------- ,

2500 1f Supply

2000 J

~ 1500i,

1000 1'soo

1994 1995

Supply Demand

1996

Supply Demand

1997

Supply: Rep.. Proc.

Demand: Petrochem. Ref.

Ref. •

E.O.R.•

NGLMix"'-"

Diluent 0 Fuel. Export.

.. NGL mix is from both processing and reprocessing plants, fractionated into specification products outside Alberta.

Figure 5: Alberta NGL Supply and Disposition

Figure 6, shows the share ofspecification products in 1997. In this graph, recovered products containNGL mix fractionated at the destination point. The share of ethane is more than other specificationproducts due to associated deep-cut facilities.

Pentanes Plus

28%

Butanes16%

Figure 6: Share of Natural Gas Liquids Supply -1997

52

I Feedstock

il Ethane ori LPGor!ICondensateI orGasoil i

i

3. Demand for Natnral Gas Liquids

NGLs can be used as feedstock, fuel, solvent flood, and diluent. The disposition ofNGL from 1994to 1997 depicted in Figure 5, and will be discussed in this section.

3.1 Petrochemical IndustryThe type of feedstock requirements for the petrochemical industry can be determined through their

process plants which are categorized into steam cracker, catalytic reformer or steam reformer. A summaryof the feedstock requirements, primary products and end use products of each type ofprocess plant areshown in Figure 7 and are described as follows:

Process Plant Prima" Products End Products I

! Ethylene I~PrOPYleneiCracker I IButadIene -----+1 Pl~tIcs II

IButylenes I , Pamts II

IFibre Textiles iIPesticides Ii

i Benzene .

III N'aphtha I I IPharmaceuticals 'I---~! Cat iii Toluene'I '.:....:.== iRefonner i NaphthaleneI Xylene I

j Fertilizersi Plastics and

I' Methane lis HAm"~ Fibresi team montaI or any H Octane BoosterI H dr rb I

i IReformer, Methanol < G I"y oca ons , lor aso me

Figure 7: A Simplified Flowchart of the Petrochemical Industry

• Steam Cracker: The feedstock requirementsfor the steam cracker can be ethane, LPG,condensate or gas oil. The primary product isolefins, which includes ethylene, propylene,butadiene and butylenes. The major endproducts of the olefins are plastics, paints,fibres, textiles, pesticides or pharmaceutical.Catalytic Reformer: The only feedstocksuitable for a catalytic reformer is naphtha.The primary product is aromatics, whichincludes benzene, toluene naphthalene orxylene. The major end use products ofaromatics are similar to olefins.Steam Reformer: The feedstock requirementsfor the steam reformer are methane or anyhydrocarbon. The main primary product issynthesis gas from which ammonia andmethanol are derived. The major end use

products of synthesis gas are fertilizers,plastics and fibres and octane booster forgasoline.

There are seventy-nine petrochemical plantsin Canada, where thirty-five plants are located inthe west and the remainder in the east. Theprovinces with the largest number ofpetrochemical plants in each region are Ontario(thirty-two) and Alberta (twenty-four).

The major feedstock requirements forAlberta petrochemical plants are natural gas,ethane, and butanes. The primary products ofAlberta petrochemical plants are ethylene,ammonia, and methanol. Fignre 8 shows currentand future production and planned expansion ofAlberta primary petrochemical products.

53

The primary petrochemical products use as feedstock as well for the secondary petrochemicalproducts such as polyethylene, urea, acetic acid, and methyl tertiary butyl ether (MTBE). The use ofMTBE as octane enhancer will be discussed in section 3.2.

Figure 8: Alberta Primary Petrochemical Products iu 1997 and Plauned Expansions

In the near future, the expansions of the currentMTBE Plant and two new additional plants ofethylene and MTBE will increase the amount ofethane and butane requirements in Alberta.

Figure 9 shows a simple block diagram forMTBE production. Field butane is fed to theDeisobutanizer (DIB) Tower. The resulting normalbutane (n-butane) is sent to the ismerization unit,

where the isomerization product returns to theDIB Tower. The product isobutane heated andsent to Dehydrogeneration reactor whereisobutane is converted to isobutylene at a 40%to 50% conversion rate. In MTBE synthesis,isobutylene reacts with methanol to produceMTBE.

III!,

ISOBUTANE

II IrJl~_-"1S0"'M,"E"R",IZA=TIQ.ON=PR",O",DU!!'crs=_,

I FIELD IIi I! II

,I, """.BO!.!°rANF I,ISO!vlEUNRIZrrATION

I

BUTA~ES Llf-c~ n-BU7ANE LlGdENDSI DRAW·OFF

I

', I 'OOO"_V' "'oc DEHYDR0- , iI 1 1'-_-1 GENATION ------.i I' • REACTOR

IMTBE I

_-"M",!ITJjH"'A",N"-O!L-~1 SY1\.'THESIS ! 1 I

1 .i. HYO;:OGEN I

MTBE LIGHT ENDS '

Figure 9: A Simplified Flowchart of MTBE Project

54

3.2 Refining Industry

Butane is one of the refinery requirementswhich is used in gasoline blending as an octaneenhancer. Among the variety of octane enhancers(lead, alcohols, MTBE, butane, etc.), lead is thecheapest one. However, the lead in gasoline hasbeen a prime target of the environmental lobbybecause of poisonous characteristics. Lead ingasoline has been prohibited in the US, andcurrently curtailed to 5 mg/L in Canada.

The second cheapest octane enhancer is normalbutane blended into gasoline. This octane enhancerhas a high vapour pressure in summer months. Ahigh vapour pressure is acceptable in wintermonthswhile it should be reduced in summer months. Thedirect use of normal butane in gasoline blendinghas been curtailed, particularly in the summermonths because ofhigher vapour pressures resultsin diminished air quality.

In general, the trend of normal butanerequirements for blending is expected to decline,but the opportunity exists to increase summerseason use of butane as alkylate. In this processoctane enhancer (iso-octane) could be made

from isomerized normal butane (iso-butane)displaced from motor gasoline and olefins fromcatalytic cracking (iso-butylene). Alkylation ishighly capital intensive and requiresisomerization ofn-butane driven out ofgasolinemarkets.

In future, refineries should either rely onexternal octane enhancing sources (MTBE,alcohols, aromatics) or on boosting volumes oftheir octane blending components, throughisomerization units, catalytic reformers, andalkylation units.

There are twenty-five refineries in Canadawith a crude oil capacity of 1,915,500 barrelsper calendar day (BPCD). Fourteen refineriesare located in the east with a capacity of1,329,700 BPCD and eleven in the west withcapacity of 835,700 BPCD.

In the west, Alberta, with 5 refineries, hasthe highest capacity of production at 381,200BPCD. The detailed capacity of Albertarefineries is depicted in Figure 10. Albertarefineries require normal butane in gasolineblending and isobutane in alkylation, where bothuses serve the market for motor gasoline.

200000

150000

8"

I; 100000

1

8I 50000

o

1~ I

I~ !~ Ii

~

f-- i----j

n ~

Petro­C=ada

Husky Imperial Parkland Shell

Figure 10: Alberta Refineries Capacity

55

3.3 Solvent Flood

The development of a hydrocarbon reservoircan be divided into three depletion phases: primary,secondary and enhanced or tertiary recovery, Theenhanced oil recovery (EOR) phase uses theaddition of artificial energy consisting of threegeneric types of processes. Thermal process usesheat to reduce the viscosity of the crude oil. This ismainly applicable in heavy oil reservoirs. Chemicalprocess behaves like detergent to wash theremaining oil. Miscible process is used to recoveroil trapped in reservoir rock after a waterflood.

A hydrocarbon solvent is a blend of dry gaswith natural gas liquids which is designedspecifically for the oil present in a given reservoirthrough miscibility testing in lab, A range ofcompositions should satisfY the miscibilityrequirements, where this composition dependsupon flood operating pressure, gaslNGLavailability and cost, reservoir oil characteristics,and facilities design.

The higher reservoir pressure requires theleaner solvent, where the lighter solvents arecheaper. However, a heavier solvent may havebetter resale value when reproduced in the future.

A simple block diagram of hydrocarbonmiscible flood facilities is shown in Figure II.As illustrated in this diagram the output of theoil well enters the battery which contains a threephase separator for oil, water and raw gas. In thegas plant a gaseous mixture of hydrocarbons issplit into gas co-products (C3+) and sulphur.Then deep cut facilities will knock out moreportion of gas co-products and ethane (C2+).Finally raw gas, methane (C1) and C2+ are re­injected into the oil reservoir as solvent flood.

For light oil the most common tertiarytechnique involves the injection ofa fluid that ismiscible with the oil under reservoir conditions.For heavy oil, the most common tertiary processis steam injections or in-situ combustion.

Use of natural gas liquids in EOR projectsreached their peak in the early 1990's. Sincethen, their use in solvent flood schemes has hada precipitous descent. The fall in solvent floodinjection of NGL's is due to a decrease in thenumber ofeconomically attractive reservoirs forthe process.

----1.1 Deep Cut I c'.1 '!!F.cilifies , c~ I I

1

I----------.,---->c~Sulphur

I

C I,.,---===QQ...---1. c I\J 1"- Solvent flood i Injection ~~Station I C

1

OilW,ll

Oil Reservoir I

Figure 11: Typical Hydrocarbon Miscible Flood Facilities

56

3.4 Diluent 4 Export Markets and Pipeline Capacity

The largest component of the market forpentanes plus is diluent for transporting heavycrude and for in-situ bitumen in Alberta. Diluentis required to increase the API gravity andreduce viscosity of heavy crudes to allowconventional pipelining. The required diluent,depending upon the characteristics of the oil,may account for one third to one halfofthe totalvolume transported.

The availability ofpentanes plus as diluent isan issue with respect to development of in-situbitumen production. However, in the long runpromising alternatives include oil-in-wateremulsions, importing pentanes plus, upgradedrefinery configurations, partial field upgradersand the use of re-produced diluent.

3.5 Fuel

Propane is the only natural gas liquid that isused directly as fuel for space heating, dryingindustrial fuel, asphalt paving and construction,water heating and cooking, and as an alternativefuel in transportation sector because it is cheaperthan butanes.

Two federal programs were introduced in198 I to promote propane fuelled vehiclesthorough a taxable grant of $400 percommercial vehicle equipped to run exclusivelyon propane, as well as providing a federal excisetax exemption to propane vehicles.

The conversion incentive program thenextended to dual-fuel and private vehicles inMarch 1985. The number ofpropane vehicles inAlberta has continued to rise, despite the end ofthe federal incentive program.

Export demand consists ofNGL mix that is notfractionated in Alberta (it is fractionated at thedestination point) and specification products. Outof province markets traditionally balanceAlberta's NGL supply and demand. The historicaldata shows that the largest importing province isOntario and the main US market is PetroleumAdministration for Defense District II (PAD II)that covers Northern Mid-west areas of the U.S.

The major Alberta feeder pipelines that moveNGL's from different production areas toEdmonton and Fort Saskatchewan are EmpressEthane pipeline with capacity of 85 thousandbarrels per day (85 mb/d). The Federated Pipeline,owned by Imperial and Anderson to servemiscible flood markets: consists of sections ofSouth (64.8 mb/d), and North (35.2 mb/d).

The Cochrane - Edmonton (Coed) Pipelinedeveloped by Dome and Amoco as a result of thestraddle plant operation at Cochrane: consists oftwo sections of North (100 mb/d), and South (80mb/d). The remaining capacity belongs toCochrane Ethane (57.5 mb/d), and Peace Mainline(170 mb/d), which are shown in Figure 12.

Two major pipelines move NGL's from Alberta.Interprovincial Pipeline, primarily a carrier ofcrude oil, moves NGL batches from Alberta toSuperior (Wisconsin) and finally to Samia. Themixed NGL capacity of this pipeline is 146 mb/d.The Cochin Pipeline, which is essentially aspecification product pipeline, moves propane,ethane and ethylene (which has the same physicalproperties as ethane) to Sarnia. Its capacity is 112mb/d. Rangeland is a small pipeline (5 mb/d)which carries crude oil and some butanes fromAlberta into Montana.

57

[Southl

[North]

Alberta Ethane GatheringSystem (AGS)

Codlrane-EdmontonPipeline (Co-Ed)

• Straddle Plant

• Field El:hane extraction

'" Ethylene Petrochemical Plant

0 Underground Storage

• selected Major Gas Plants

- - - Peace Pipeline

- - - _. Rangeland Pipeline

••••••• o. Interprovincial Pipeline

• Federated Pipelines

•••••••••• COchin Pipeline

JoIT,e{Novacor)

.1'".11"'"Swa:>E:US.·

.<;~ordond:>l. Jud,' (hek.~'" p •..• "~ Fc:t Sask::lcbew""___ ..... .-:a..:.:.._

T....

K2.ybob~lh I /

I /We$!. Po=nb;oa I ( :

I '..................:\ ....::1I \ ~

..LJv.f/ 1\....

",,·iQCaroiio"'\f<l

~ t\ Co<h'~.

Figure 12: Alberta NGL Feeder Pipelines

5 Conclusions .. Projections ofNGLs

Alberta, like other parts of the world, obtainsNGLs from the processing of natural gas andrefining of oiL Its demand for NGLs, however, isdetermined more by local circumstances,particularly the mix of chemical processes. Forexample acetic acid in Alverta is produced frombutanes, whereas elsewhere the feedstock is usuallymethanol; propane is the heating fuel of choice inAlberta remote areas whenever natural gas is notavailable, whereas elsewhere "fuel oil" is morecommon.

In general, supply of NGL varies with theamount of natural gas production, the liquidscontents ofinlet gas, and advances in NGLextraction technology.

In addition to gas processing and reprocessingplants, refinery production is another source ofNGL supply. Types and volumes of crude oil usedin refining, and refinery configurations determinethe amount of butane and propane production.

The last potential source ofsupply is solventflood reproduction, which is not usually takeninto ccount because measurement can notidentifY it separately.

The disposition ofNGL can be categorizedinto petrochemical plants, refineries, solventflood, dileuent, fuel and export.

The future increase in ethane and butanepetrochemical feedstock demand depends on thecapacity utilization rate ofethylene, and MTBEplants. Similarly, the butane requirements in therefineries depend on the production of motorgasoline, and type of octane enhancer andoctane blending needs.

The NGL mix used for solvent floods varieswith crude oil prices, remaining reserves inexiting light and medium oil reservoirs undertertiary recovery, flood operating pressure, andfacility design. The pentanes plus requirements(diluent) are determined based on heavy crudeoil and non-upgraded in-situ bitumen productionto serve Alberta refineries or markets outside ofAlberta.

58

The propane use as fuel depends upon the conversion ofvehicles from motor gasoline to propane,as well as cooking, crop drying, heating, etc. in remote areas. A summary ofNGL supply and demandsources is shown in Fignre 13.

Finally the potential shipment ofNGL from Alberta depends on the supply ofNGLs, Alberta'srequirements, and pipeline capacity.

Processing Plants S S S S(Inc!. Deep-cut facilities)Reprocessing Plants S S S SRefinery S SSolvent Flood Reproduction S S S S

SUPPLY ++ DEMAND ETHANE PROPANE BUTANE PENTANES+

Petrochemical D DRefinery DSolvent Flood D D D DDiluent DFnel DExport (other than diluent) D D D D

Fignre 13: Sources ofNGL Supply and Demaud

Appendix 1: Definition of TechnicalWords and Terms

Acid GasThe hydrogen sulfide and/or carbon dioxidecontained in or extracted from gas or otherstreams.

AlkylateAlkylate is the product ofalkylation process,where in this process combining isobutaneand isobutylene form iso-octane. Alkylationis simply the reverse of cracking and haslargely replaces polymerization.

Catalytic ReformIngCatalytic reforming is a process in which

napthenes are converted to aromatics by removalof hydrogen in the presence of a catalyst.

Carbon dioxideA heavy, colourless gas having the formulaC02. When in its solid state, it is commonlycalled "dry ice".

CondensateThe liquid formed by the condensation ofa vapouror gas: specifically, the hydrocarbon liquidseparated from natural gas because of changes intemperature and pressure when the gas from thereservoir is delivered to the surface separators.Such condensate remains liquid at atmospherictemperature and pressure. It may also be watercondensed and returned to boilers in a steamsystem.

59

Deep-Cut FacilitiesA gas plant adjacent to or within gas fieldplants for extraction of ethane and furtherextraction ofpropane, butanes and pentanesplus.

DehydrationThe act or process of removing water fromgases or liquids.

DistillationThe process of separating a multiplecomponent feed of differing boiling pointsinto two or more products. In absorptionplants, the term is used to describe theseparation of product components fromabsorption oil.

Such facilities are also referred to as field plants.

Gathering SystemThe network ofpipelines which carry gas from thewells to the processing plant or other separationequipment.

Hydrocarbon SolventTwo methods exist in flooding a hydrocarbonreservoir with solvent. The first method is verticalmiscible flood where solvent displaces the oiildownward to the producing zone. Te secondmethod is a horizontal flood, which represents theremaining share of NGL demand and floodableoriginal oil in-place. Vertical and horizontal floodshave an average recovery of 25% and 12 %respectively.

Inlet GasGas entering a gas processing plant or unit.

IsomerizationIsomerization is a process for rearraing the atomsin a molecule so that the product has the sameformula but a different structure, e.g. convertingnormal butane to isobutane.

Dry GasGas whose water contents has been reducedby a dehydration process.

ExtractionThe process of separating one material fromanother by means of a solvent. This tern canbe applied to absorption of liquid, liquidextraction, or any other process using asolvent.

Inlet SeparatorA vessel in the oil or gas field for separatingthe gas, hydrocarbon liquid, and water fromeach other.

IncineratorApparatus or equipment,undesirable material toobjectionable flue gasses.

which convertsashes and less

Flare GasGas that is burned in a flare or pit.

Gas InjectionThe injection of natural gas into a reservoirto maintain or increase the reservoirpressures or reduced the rate of decline ofreservoir pressure.

Gas processing PlantA plant which processes raw natural gas forrecovery of natural gas liquids andsometimes other substances such as sulphur.

60

Liquefied Petroleum Gases (LPG)Predominantly propane or butane separately or inmixtures which are maintained in a liquid stateunder the pressure within the confining vessel.

Marketable Natural GasGas which meets specifications for direct use as aresidential or commercial fuel. It is made up ofthe volume ofgas available for marketing after theextraction of natural gas liquids and sulphur atfield processing plants, plus the volumes of gasavailable from fields for which processing is notrequired. Marketable gas is measured at the fieldor processing plant gate.

Miscible FloodA method of secondary recovery of fluidsfrom a reservoir by injection of fluids thatare miscible with the reservoir fluids.

Natural Gas Liquids (NGLs)Propane, butanes, and/or pentanes plus,obtained from the processing of raw gas orcondensate.

Pentanes PinsA mixture mainly of pentanes and heavierhydrocarbons which ordinarily may containsome butanes and which is obtained from theprocessing of raw gas, condensate, or crudeoil.

Primary recoveryPrimary recovery uses the natural gas energyof reservoir such as gas cap expansion andsolution fas drive.

Raw GasUnprocessed gas or inlet gas to a plant.

Reprocessing PlantA gas plant used to extract ethane and naturalgas liquids from marketable natural gas.Such facilities, also referred to as straddleplants, are located on major gas transmissionlines.

Secondary RecoverySecondary recovery adopts mechanicalenergy as a supplement to primary recovery,The two typical methods are water floodsand gas floods.

ShrinkageThe reduction in volume and/or heatingvalue ofa gas stream due to removal ofsomeof its constituents.

Solvent FloodThe process by which a suitable mixture ofhydrocarbons ranging from methane topentanes plus but consisting largely ofmethane, ethane, propane, and butanes isused for enhanced-recovery operations in oilreservoirs.

SOlution GasGas which originates from the liquid phase in anoil reservoir.

Sour GasGas containing an appreciable quantity ofhydrogen sulfide and/or mercaptans.

Stabilization FacilitiesA fractional system that stabilizes any liquid, i.e.reduces the vapour pressure so that the resultingliquid is less volatile.

Sulphur PlantA plant that makes sulphur from the hydrogensulfide extracted from natural gas. One-third ofthehydrogen sulfide is burned to sulphur dioxide,which is reacted with the remaining hydrogensulfide in the presence of a catalyst to makesulphur and water.

SulfreenThe Modified-Clause process is based on thechemical reaction of HzS and SOz to formelemental sulphur. The Sulfreen process is tail gasclean-up extension of the Clause reaction thatpromotes the reaction of H 2S and S02 (125 to150 degrees Celsius temperature) to form sulphurto the extent that the overall design sulphurrecovery level can exceed 99 % .

Sweet GasGas, which has no more than the maximumsulphur content defined by the specifications forthe sales gas from a plant.

Synthetic GasThe preferred term to describe the saleable gasproduct resulting from the gasification of coaland/or gas liquids or heavier hydrocarbons.

Tail GasThe exit gas from sulphur recovery unit.

Wet GasRaw gas which is rich in hydrocarbon liquids.

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REFERENCES

Alberta Oil and Gas Industry. AnnualStatistics, AEUB, ST 97-17

Alberta's Reserve of Crude Oil, Oil Sands,Gas, Natural Gas Liquids and Sulphur.AEUB, ST 98-18

Approved Gas Processing Plants in Alberta,AEUB, ST98-50

Canadian Natural Gas Focus, BrentFriedenberg, Volume II, Issue I, 1997,Calgary, Alberta

CHEM Systems Inc. CanadianPetrochemical Industry 1985-1995

Engineering Data Book, Gas ProcessorsSuppliers Association 1979, Tulsa,Oklahoma.

Gasoline Regulations, CanadianEnvironmental protection Act, Corpuspublications Services Ltd., SOR 98­217

Hawkins, D., J. (1988) "Outlook for NGLBusiness in Canada" symposium onCanadian Natural Gas Liquids Potential,Calgary, Canada

Heath, M., (1995) "Natural Gas Liquids:Market Outlook" study #60, CanadianEnergy and Research Institute, Calgary,Canada

Milne, K., C. (1988) "Plant Design forMaximum NGL Recovery" CanadianSociety for Chemical EngineeringSymposium, Calgary, Canada

Moore, J., S. (1988) "Enhanced OilRecovery Outlook, Economic Prospectsfor EOR in Canada" International Oiland Gas Markets Conference, Calgary,Canada

Morgan, D. J., (March 23, 1988) "CurrentDevelopment in NGL Recovery"Canadian Institute of Energy, Calgary,Alberta

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