NGLs are derived from gas wells or through crude oil. They are produced through refrigeration and distillation in the gas plants or refineries. NGLs are considered to be the by-products of the oil and gas industry. The gas plants extract the NGLs to maintain and ensure the production of pipeline quality of natural gas and to increase their profits as well. The NGLS are the by-products of the natural gas, and are transported to the market only after the natural gas is processed to meet pipeline hydrocarbon dew point specifications. The NGLS are transported through major pipelines.
The NGLS are composed of methane ethane, butane, propane and other hydrocarbon compounds like iso-butane and pentanes. The figure gives us a better idea of the composition of the NGLs. Based on their vapor pressure, NGLs are classified as low (condensate), intermediate (natural gas), and high (liquefied petroleum gas). The price of the NGLs depends on that of crude oil, as it forms the major source for NGLS.
The NGLs have immense uses in almost all the sectors of the economy. They are used as inputs in the petrochemical plants, as components for vehicle fuel, and also in heating and cooking.
Even as by-products, NGLs are valued immensely, and with the development of gas exploration, NGLS have gained prominence in the market. The boom in gas exploration has led to a nascent stage of the NGL Renaissance, a home-grown energy source.