The Ultimate Guide to Ethane Rejection:
Everything you need to know and more!
Whether you are new to the world of ethane rejection or an experienced veteran, this blog post will provide you with everything that you need to know about ethane rejection. From what it is, who needs to worry about it, and how it can affect your plant, to what you can do to either REJECTING or RECOVERING ETHANE, here is your ultimate guide!
What is Ethane Rejection?
Ethane rejection is a process that removes ethane from the product stream before it enters downstream Natural Gas Pipelines. Wet gas streams (raw natural gas that still contains natural gas liquids – NGLs) Processing plants typically are built with two main NGL extraction techniques: Refrigeration and Cryogenic.
How is ethane recovered or rejected?
Refrigeration Processing removes heat and drops the temperature of the wet gas stream which then allows the heavier NGLs to drop out, though lighter elements such as Ethane (C2) and Propane (C3) are not extracted efficiently. Cryogenic Processing drops the gas stream to approximately -120 degrees Fahrenheit which allows for Ethane and Propane to be extracted efficiently.
The difference between recoveries can be significant. For example, refrigeration might be able to extract Ethane around 40% of the total Ethane detected in the gas stream, while cryogenic will be able to extract Ethane over 90%. This allows for cryogenic facilities to recover Ethane at 90%+ and the plant can choose how low to drop the temperature to recover Ethane at the full 90% or to drop the temperature slightly less to “Reject” Ethane. Cryogenic natural gas processing plants have varying degrees of efficiency when Rejecting Ethane – some plants might be able to Recover only 8% (leaving 92% of Ethane in the downstream gas).
Here is a sample of recoveries for a highly efficient Cryogenic Processing Plant:
In Recovery Mode, Ethane gets efficient recoveries at 90.9% and Propane at 99.3% which provides efficient extraction of C2 & C3 out of the gas stream. This plant is able to optimize in Rejection Mode to lower recoveries for Ethane to 9.3% and Propane at 92.2%.
Now you might ask, why would you want to do that, silly?
Why would you WANT to Reject Ethane?
What makes the world go around? Newton’s first law of motion states that an object in motion stays in motion – so physics really … Actually, we were talking metaphorically – it’s all about the Benjamins, Dollars, Green, Moola.
Bottom line: MONEY
Natural Gas, Ethane, Propane each have a value – and those values combined with recoveries will determine the value derived from the Plant Inlet Mcf.
For simplicity, let’s just look at Ethane vs Natural Gas (which is the main driver in the calculation):
For 10,000 Mcf with a 1.3 BTU Factor and a C2 GPM of 3.00:
- Recovery (90% extraction):
- Ethane Volume: 27,000 Gallons
- Natural Gas Volume: 11,209 MMBtu
- Rejection (10% extraction):
- Ethane Volume: 3,000 Gallons
- Natural Gas Volume: 12,801 MMBtu
For a price case of Ethane at $0.30 per Gallon and Natural Gas at $3.50, Recovery ends up being a better option by $0.16 per inlet Mcf.
So, let’s take a look at a couple of quick price cases if you only Recover:
Ethane
|
Natural Gas
|
Recovery vs Rejection
|
|---|---|---|
$0.30/Gallon
|
$3.50/MMBtu
|
+ $0.16/Mcf
|
$0.25/Gallon
|
$4.50/MMBtu
|
($0.12)/Mcf
|
So, when Ethane is $0.30/Gallon and NG is $3.50/MMBtu, RECOVERY is a better economic option by $0.16/Mcf which is worth $48,667 if you ELECTED RECOVERY on 10,000 Mcfd!!!
And, when Ethane is $0.25/Gallon and NG is $4.50/MMBtu, REJECTION is a better economic option by $0.12/Mcf which is worth $36,500 if you ELECTED REJECTION on 10,000 Mcfd!!!
As you can see, if you ALWAYS recover ethane, you can lose money.
The key is to watch these economics monthly at a minimum!!
Would you like to get a Weekly Ethane Rejection Analysis for YOUR PLANT?
If you would like YOUR PROCESSING PLANT with a daily updated forward outlook of Ethane Recovery vs Rejection for ONLY $500/month, drop us a line at rogue@energyrogue.com and bill@energyrrogue.com to set it up!
Who needs to worry about Ethane Rejection?
Producers, Midstream, and Downstream – yep pretty much everyone!
- PRODUCERS need to elect Ethane Rejection or Recovery for their highest Well-Head Net Value!
- MIDSTREAM:
- Processors need to monitor for Plant profitability
- Pipelines need to monitor for Gas Quality
- DOWNSTREAM:
- Natural Gas Consumers should know whether Ethane is being rejected as that would provide more Natural Gas Supply to the mix (an estimated 0.8 Bcfd is the swing Ethane Recovery/Rejection)
- Ethane Consumers should know whether Ethane is more profitable in the Natural Gas stream or as Purity Ethane
Essentially, any part of the energy value chain SHOULD know about Ethane Rejection!
Conclusion:
Ethane rejection is a complicated process, but one that can bring value to your organization! As you can see from this Ultimate Guide to Ethane Rejection, the economic value impact around whether to recover or reject ethane is worth it (currently Recovering Ethane is worth $0.15/Mcf).
Producers can create incremental value for their Well Head Netback.
Midstream Processors can be more profitable managing the Plant Operations to the most economic result. Midstream Pipelines need to monitor ethane for gas quality.
Natural Gas Consumers will be able to determine whether there will be more or less natural gas due to processing is necessary to ensure that the gas flowing into the pipeline is the highest quality gas possible.
Ethane Consumers will know whether there will be less ethane available due to rejection or more ethane available due to recovery.
Ethane Rejection sounded like a foreign concept at first but luckily, this guide has provided you with all of the information you need to know about ethane rejection.
Have a great day!
Team Rogue
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