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Seriously, you may have heard the term Y Grade before and thought “HUH?” – let’s be honest, when we first heard it – we thought the same thing.

What is the background on Y Grade?

Most people in the industry seem to respond to the question:  “why is it called Y Grade?” with “hmmm, honestly I have no idea.”  Well, legend has it that an old Texas pipeline company assigned letters to products shipped on it’s pipeline got to the letter Y with Natural Gas Liquids (or NGLs).  There you have it – not super relevant today but definitely fits in the “More you know … “ category.

So if Y Grade are NGLs - then what are NGLS

As we defined in our other blog post “NG, NGLs, and LNG à OMG”  we defined Natural Gas Liquids as:

“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).”

Natural Gas Liquids or NGLs exist in the molecules extracted in Oil and Gas Drilling.  Oil is separated at the surface into separate tanks.  Gas at the well-head level can continue some combination of:  water, CO2, H2S, HS, Hg, Nitrogen, Helium, Methane (CH4), Ethane (C2), Propane (C3), Iso Butane (iC4), Normal Butane (nC4), and Natural Gasoline (C5+). 


Water, CO2, H2S, HS, Hg, and Nitrogen are separated from the gas stream as these products aren’t typically commercially useful.  Helium only exists in some reservoirs (more about Helium later…) and can only be extracted at extremely low cryogenic processing methods.

That leaves us with Methane (C1), Ethane (C2), Propane (C3), Iso Butane (iC4), Normal Butane (nC4), and Natural Gasoline (C5+).  These travel in a stream to a Natural Gas Processing facility that utilizes either refrigeration or cryogenic cooling to separate the “liquid” gas molecules (C2 through C5+) from the gas components (Methane).  Methane is also referred to as residue gas and typically is ready for interstate transportation and safe usage for utilities and industrial demand.

The NGLs then leave the processing plant (either via truck or pipeline) in one combined liquid – referred to as … you know it, I know you know it:

Y Grade!!  (article continues after our shameless plug)

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

What happens to the Y Grade and is it valuable?

Answering the second question first – it is valuable in it’s components:

  • Ethane is used in the manufacturing of plastics
  • Propane is used for heating in remote areas of the country (and that thing you do on Sunday that seems to take all day – grilling)
  • Butanes are typically used in refinery processes
  • Natural Gasoline is used as a blend stock for types of crude oil

But, if it’s one combined liquid – how do we get the components?

This will be a topic for another day, but the next step required to make this combined liquid valuable is to break it into it’s components.  This process is called fractionation which will separate each one of the liquid elements into it’s own individual stream.  The process of fractionation is complicated and the cost to build a fractionation is high – so there are only a limited number of fractionation facilities in the US.

Why should you care?

Each one of these products exist in a “raw” gas stream at the Oil & Gas Drilling extraction location.  Realizing both the processes to make these products commercially viable and the cost/value after the product has been made commercially valuable.  For example, Y Grade is not valuable but each one of the components are valuable – thus fractionation is an important and necessary function in the industry.

In Summary:

  • Y Grade is another name for NGLs which is another name for Natural Gas Liquids
  • Gas at the Oil and Gas site needs to be separated at a Natural Gas Processing Plant to separate Methane (CH4) from the Y Grade
  • Y Grade needs to be fractionated to derive it’s value in the components

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

Have a great day!

Team Rogue

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