Bullish Outlook for Ethane Production

While NGLs are produced at both natural gas processing plants and petroleum refineries, natural gas facilities are expected to provide more than 95% of the forecast production growth, EIA states. Between 2008 and 2015, NGL production at natural gas processing plants (including fractionation facilities) increased as a by-product of the huge supply increase of natural gas from shale plays and tight oil formations. Ethane production, constrained by lack of demand and low prices in recent years, is expected to increase at a faster rate than other NGLs in 2016 and 2017, as expanded petrochemical and export capacity provides new outlets for supply and allows more ethane to be recovered from raw natural gas. Forecast natural gas plant ethane production increases by 300,000 BPD between 2015 and 2017, accounting for 67% of total NGL production growth, EIA projects. The U.S., a net importer of all NGL products in 2007, became a net exporter of natural gasoline in 2008, of butane and propane in
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