What is Crude Oil? What is Condensate?

What is Crude Oil? What is Condensate?

The energy industry has avoided hard definitions for Crude Oil versus Condensate.  One of the more confusing parts of the energy industry is why there are different names for the same thing – a barrel of gooey black stuff is all crude oil – RIGHT?!?

 

 Well … not exactly

Composition of Crude Oil and Condensate

Crude Oil and Condensate are  mixtures of hydrocarbons that contain various components.  Depending on the extraction technique, geographic location, reservoir, and numerous other factors the components of a barrel of crude oil or condensate can contain any combination of asphalt, petro-chemical feedstocks, heavy fuel oil, jet fuel, diesel, automotive gasoline, lubricants, waxes, and hydrocarbon gas liquids.

One of the key factors in the industry in understanding the difference between crude oil and condensate is the quantity of hydrocarbon gas liquids (HGL) in a barrel of crude oil.  If a barrel has more HGL, then the barrel is considered “light” or high gravity. 

Fact: Energy Professionals waste HOURs every day trying to find Accurate, Unbiased, and Objective Oil & Gas Analysis.

GRAVITY

The American Petroleum Institute (API) is the largest US trade association for oil and natural gas.  According to the API, the following classifications exist for light, medium, heavy

Type of Crude Oil
API Gravity
Heavy
Below 22.3 Degrees
Medium
22.3 to 31.1 Degrees
Light
Above 31.1 Degrees

Um – ok – so what about Crude Oil versus Condensate?

Let’s start with the API of West Texas Intermediate Crude which is considered the benchmark quality standard for the United States.  West Texas Intermediate Crude (WTI) is 39.6 degrees.  Often the industry participants round this off to 40 degrees for simplicity.

Generally, the higher the gravity then there are more hydrocarbon gas liquids (HGLs) in the barrel.  There isn’t a hard cutoff on gravity to determine whether a barrel is crude oil or condensate.  That said, generally it is safe to say any gravity above 50 degrees would be considered among all energy participants to be condensate.  Barrels between 40 and 45 are considered light crude oil. Barrels that are between 45 degrees (WTI quality) and 50 degrees – this has historically been the area where most industry participants debate whether to call the barrel crude oil or condensate.

API Gravity
Industry Classification
Below 30 Degrees
Heavy Crude Oil
30 - 40 Degrees
Crude Oil
40-45 Degrees
Light Crude Oil
45-50 Degrees
Crude Oil OR Condensate
50 Degrees or Above
Condensate

Summary:  What Gravity is Condensate?

According to the API definition, a West Texas Intermediate Barrel (the benchmark quality utilized for the NYMEX and ICE financial contracts) is a “light” barrel.  About 4-5 degrees higher, and you get into the “fuzzy” definition of Crude Oil or Condensate. 

But the industry seems very consistent that any barrel lighter than 50 degrees is classified as Condensate. So, to make it clear as mud:  

  • 40 Degrees or Less:  Crude Oil
  • 40 to 45 Degrees:  Light Crude Oil
  • 45 to 50 Degrees:  Some call it Crude and others call it Condensate
  • 50 Degrees or More:  Condensate

Hopefully, this helps to understand all of these CIA’s (crazy industry acronyms) 🙂

Have a great day!

Team Rogue

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Rogue Edge is a comprehensive and robust dashboard for oil, natural gas, natural gas liquids, and refined products. The dashboard includes interactive and downloadable charts for fundamental analysis and technical analysis. Supply and demand for each commodity in the US and internationally is available as well as technical indicators to predict short term price direction. The Rogue Edge also provides Artificial Intelligence analysis to predict future supply and demand.



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NG, NGLs, and LNG ——> OMG

What is the difference between natural gas, NGLs (natural gas liquids), and LNG (liquified natural gas)?

Ok – I know you want the quick answer – so if you don’t want to know “the rest of the story” :

Natural Gas is Methane or CH4 after processing NGLs from the “Raw Gas” or “Wet Gas” Stream for transportation and consumption.

Natural Gas Liquids are a general term used for the combined components of C2 (ethane), C3 (propane), iC4 (isobutane), nC4 (normal butane), C5+ (Natural Gasoline).

LNG is “Liquified Natural Gas” where Methane (CH4) is cooled to a liquid form to transport (typically on an LNG vessel) to domestic and international markets.

Where does natural gas, NGLs, and LNG come from?

Natural Gas, NGLs (Natural Gas Liquids), and LNG start from reserves located underground. 

The raw energy (wet gas stream) is extracted from a well and brought to the surface.  The wet gas stream has both natural gas and natural gas liquids (NGLs) contained within the gaseous stream. 

Usually, this stream flows down pipelines to Natural Gas Processing Plants.  These Natural Gas Processing Plants separate the Methane (Natural Gas or CH4) from the NGLs (Natural Gas Liquids). 

At the end of the Natural Gas Processing Plant (or Natural Gas Processing Plant Tailgate), the Natural Gas is considered Dry or free from NGLs, which enables the gas to flow to Interstate Pipelines and Citygates – which is safe for consumption after the liquids are removed. 

Fact: Energy Professionals waste HOURs every day trying to find Accurate, Unbiased, and Objective Oil & Gas Analysis.

LNG Vessel

Over recent years, with abundant Natural Gas Reserves being developed in the United States, several LNG (Liquified Natural Gas) Export Facilities have been built and commissioned.  Liquified Natural Gas or LNG is a process of cooling CH4 to a liquid form and holding temperature and pressure so that the energy contained can be transported (typically on a boat) to various international destinations for consumption.

Natural Gas Processing

At the end of the Natural Gas Processing Plant, the NGLs (Natural Gas Liquids) are either loaded into a tank for delivery to trucked markets or into a pipeline.  The NGLs have multiple liquid gas components within the stream:

C2 (Ethane)

C3 (Propane)

iC4 (isobutane)

nC4 (Normal Butane)

C5+ (Hexanes, Pentanes, etc.)

At the Natural Gas Processing Plant tailgate, the NGLs are also referred to as “Y-Grade” which is a term that refers to NGLs (Natural Gas Liquids) prior to Fractionation.  Fractionation is the process of separating each element (ethane, propane, isobutane, etc.) from the other to make it usable in various chemical processes. 

Natural Gas

At the Natural Gas Processing Plant Tailgate, the inlet “Wet Gas” has split into the “Y-Grade” as we discussed.  The remaining “Residue” is considered Dry Natural Gas which is typically at the specifications for pipeline transportation.  

Once Natural Gas leaves the processing plant it travels down Intrastate or Intrastate Pipelines for either consumption or conversion to LNG.

In summary, what is Natural Gas, NGLs, and LNG again?

Natural Gas is Methane or CH4 after processing NGLs from the “Raw Gas” or “Wet Gas” Stream for transportation and consumption.

Natural Gas Liquids are a general term used for the combined components of C2 (ethane), C3 (propane), iC4 (isobutane), nC4 (normal butane), C5+ (Natural Gasoline).

LNG is “Liquified Natural Gas” where Methane (CH4) is cooled to a liquid form to transport (typically on an LNG vessel) to domestic and international markets.

Hopefully, this helps to understand all of these CA’s (crazy acronyms) 🙂

Have a great day!

Team Rogue

Don’t have a job – GET ROGUE EDGE™ FREE!!!

CLICK HERE AND REMAIN DETERMINED!

Rogue Edge is a comprehensive and robust dashboard for oil, natural gas, natural gas liquids, and refined products. The dashboard includes interactive and downloadable charts for fundamental analysis and technical analysis. Supply and demand for each commodity in the US and internationally is available as well as technical indicators to predict short term price direction. The Rogue Edge also provides Artificial Intelligence analysis to predict future supply and demand.



Still Curious?? Book a meeting with Bill & Brian via the link below

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basic

edge

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