PITTSBURGH, PA — “The softening in prices is sorry news for drillers that have relied on natural gas liquids to compensate for record-low natural gas prices. Natural gas liquids, or NGLs, are extracted alongside the natural gas and stripped out for sale at prices that tend to follow higher crude oil figures. Their use in manufacturing, particularly in plastics, have made them desirable to a petrochemical industry growing to accommodate the rise in production.
But despite the attention of some of the world’s biggest companies, the age-old rules of supply and demand are catching up to the hydrocarbon market.
Ethane and propane production is at the highest level in decades, especially since firms have diverted attention away from “dry” gas portions of shale rock that don’t contain the liquids.”
— Erich Schwartzel, Pittsburgh Post-Gazette