What are we really producing with our wells?

 Earlier a whole list of derivatives from the shale was stated. We had natural Gas, natural  gas liquids, butane, propane and others. Does anyone have a idea as to what the breakdown is in the derivatives we have produced?

  I was kind of wondering about propane as right now propane is over $4 a gallon and of course the familiar shortage price gouge is being sounded.  

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Permalink Reply by Sylvester Deal on January 25, 2014 at 10:41am

Billy,

From a refrigerator plant, about 45% liquid volume is propane, 30% butanes, the remainder natural gasoline.  The percentages depend entirely on gas composition of inlet gas. There is very little ethane recovered as temperature are not low enough to even recover all the propane.  With a cryo plant, temperatures are low enough to get all the propane and big chunk of ethane too.  Of course the liquid percentages change as more stuff is recovered from the gas.

Reports are that propane that makes it to the coast is prime for export to South America and a supply crunch in the corn states was caused by re-purposing a propane line from Canada..Most problem are result of access not production.

Permalink Reply by Tim Tarr on January 25, 2014 at 8:27pm
It's a transportation problem. Not a supply situtation.
Permalink Reply by Jim Litwinowicz on January 26, 2014 at 3:57am

Billy; "Price gouging" as you call it, is a good thing. Its the fastest way to alleviate the shortage. First high prices force consumers to limit their use and conserve.  It also helps prevent people from topping off their tanks........if they hear of a shortage, people will order more even if they have enough to last a month. With higher prices, people will wait until they need it, hoping prices will fall back to normal as we get close to spring.

Further, high prices encourage suppliers to ship more. If you have a propane supply company with plenty of supply in Tennessee and see higher prices in Michigan, you will load up ten trucks and ship it out.  If the rices are the same in Michigan, why pay the drivers and spend the time and money to ship it that far?


Higher prices will also encourage the industry to work overtime to make more propane available.

The free market system is the quickest and best way to fill the void.

Permalink Reply by George Brown on January 27, 2014 at 1:35pm

Excellent analysis, Jim.

Permalink Reply by lance on January 28, 2014 at 7:39am

Too bad our Pres. doesn't think that way... He would rather be in control of it... With his pen and his phone to 'dictate' how much we all should pay, just like healthcare.

Permalink Reply by lance on January 28, 2014 at 9:04am

Let's get em drilled, Amen!!!

Permalink Reply by George Brown on January 29, 2014 at 2:19am

Utica, of course the product will go where it is more valuable.  That is simple economics.  What you need to understand is it is not being given away.  It is being sold which brings wealth back into this country.  That wealth increases our standard of living. You are narrowly focusing on the cost to local propane users in Ohio, without viewing the big picture.  This is a very common mistake made by those who fail to understand economics.

The good news is that since the foreign markets are increasing the value of the propane, there will be more incentive for us to produce it, which will lead to more drilling and greater innovation. If Marathon decides to hold back production, that gap will be filled by another company. Only a true monopoly can conspire to increase prices or decrease service.  Think of the United State Postal Service.  When they raise the price of a first class stamp, you cannot go somewhere else to mail your letter because it is AGAINST THE LAW for anyone else to offer first class mail delivery services.

Allow the free market to work without government corruption and crony capitalism and you'll see us reach energy independence, pay lower prices for energy and witness an increased standard of living.

Permalink Reply by Nancy LeNau on January 28, 2014 at 3:17pm

New Jersey are using PA. Natural Gas for their Power Plants and saving their customers 24 % IN 2014  compared to 2013.  This is really Great !  I loved my last electric bill !

Permalink Reply by lance on January 29, 2014 at 1:44am

I sure wish Ohio would do something to lower our electric bills.... The war on coal waged by our current administration is pushing our electric bills higher. With all the regulations and stipulations the environmentalists are making things worse for the working man and families... My last bill was 600.00 almost as much as my house payment.... The next one will be worse than that with all the cold we've had this winter... It's -23 degrees this morning.... Never seen it that cold before....

Permalink Reply by Nancy LeNau on January 29, 2014 at 3:31pm

Lance, So sorry to hear this.  My Best wishes to you for a better Future !  Hang in there and God Bless.

Permalink Reply by lance on January 30, 2014 at 3:28am

Thanks Nancy, God bless you too.... Think Spring....

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