Hello. We're continuing here with energy 
sources in Energy 101. 
We've looked at coal, we've looked at 
oil, we've looked at natural gas, and now 
we're going to look at natural gas 
liquids. 
Natural gas liquids is not something you 
hear about very often, but they're 
becoming increasingly important because 
of the increased production that we're 
getting from natural gas liquids. 
What are natural gas liquids? Well, 
natural gas liquids is a by-product of 
natural gas production. 
And they come at the well. 
In other words, they come out of the 
ground just like natural gas. 
As a matter of fact, they come with 
natural gas -- that's the reason they're 
called natural gas liquids, and they are 
receiving increased attention due to the 
increased natural gas production. 
And so we increase natural gas 
production, you increase the, natural gas 
liquids that come with them. 
So, what are the natural gas liquids? 
Compared to, if we look at the molecular 
structure, compared first to natural gas 
itself, natural gas is a methane 
molecule. 
1 carbon and 4 hydrogens and at 
atmospheric temperature and pressure it 
is a gas. 
And as a matter of fact, to get it to a 
liquid, you have to actually cool it to 
-260 degrees farhenheit. 
No matter how high you take the pressure, 
natural gas will not liquify. 
That is not true with natural gas 
liquids. 
Natural gas liquids are those gases and 
heavier hydro-carbons of CH4 that come 
out with natural gas. 
and if you pressurize the natural gas. 
With natural gas liquids together the, 
natural gas liquids will form liquid 
droplets and you can separate it. 
So the liquids that come out with the 
natural gas is ethane. 
C2H6. 
Propane, C3H8, butane, C4H10. 
Isobutane, which turns out to have the 
same chemical formula, C4H10, but it's 
isomer of butane we won't deal with the 
chemistry of what an isomer is for now. 
And pentanes which are C5H12, and 
pentanes actually come out at Atmospheric 
temperature and pressure as liquids. 
All the rest of them are, they actually 
come out as gas and don't liquify until 
you pressurize it. 
But you, you're familiar with propane or 
butane because we use it in our grills, 
our home grills to barbecue and things. 
And we also use it in tanks and a lot of 
homes to heat homes. 
So, but they have to be pressurized. 
And when we reduce the pressure, to 
atmospheric pressure, which we do when we 
use them, just like in a gas grill. 
Is the pressure regulated that drops the 
pressure. 
From 50 or 100 pounds per square inch. 
Down to atmospheric pressure. 
The liquid that's in the tank turns back 
into the gas, as they were when they came 
out of the ground. 
So that's why we call them natural gas 
liquids. 
They're gasses, except for pentane that 
come out of the ground with natural gas. 
production and they are hydrocarbons as, 
as we see here. 
So why are, for what are their general 
characteristics? Well as I've already 
commented, they come out of the ground 
with natural gas in the gaseous state. 
And, we then pressurize the mixture. 
And we separate the natural gas liquids. 
And so, they all liquify when you 
pressurize them. 
Except pentane, which is liquid and 
atmospheric. 
And it comes out of the ground. 
And atmospheric pressure is already a 
liquid. 
But counter to these natural gas liquids. 
Natural gas itself even though we 
pressurize is going to comes out of the 
ground to separate the liquids, the 
natural gas itself will not liquify. 
As a matter of fact, it will never 
liquify at atmospheric temperature no 
matter to what pressure you take it to. 
That's just the nature of methane. 
So, we will talk to later about natural 
liquified natural gas, LNG, which is 
totally different from NGL's. 
So we got confusing, nomenclature here, 
but natural gas liquids. 
Are these things that we just mentioned. 
The ethanes, the butanes, the propanes, 
or the pentanes. 
And but if we take natural gas and 
refrigerate it to extremely cold 
temperatures minus 260 degrees 
fahrenheit. 
Then natural gas li, itself will liquefy 
and we call that liquefied natural gas. 
So the liquid is on the front end, for 
the liquefied natural gas, rather than 
the tail end of natural gas liquid. 
So don't get confused over that the, the 
nomenclature that is used commonly in the 
industry. 
So what is the production of natural gas 
liquids and what's the trend? Well you 
can see from this graph that over here on 
the right out here at 2011. 
The production has gone up significantly. 
And it was fairly level from 1981 at one 
and a half million barrels a day, until 
it grows gradually up to about 1.8 
million barrels a day in 2007. 
And since then has increased to about 
2002. 
Barrels of oil equipped barrels of 
liquids a day that comes out here in the 
US with the natural gas and is used and 
marketed and processed. 
So, production has gone up as I mentioned 
and that's because of the. 
Horizontal, well, natural gas, fracking, 
that has surged natural gas production. 
because the production of natural gas, 
and the production of natural gas 
liquids, go up together. 
So we have had a surge, and that's why, 
people are talking them more now. 
but that's the trend. 
it's not dramatic. 
But it's up from 1.7, 1.8, to 2.2. 
So that's about a 20% increase. 
Which is a signifigant increase. 
So, how much is, is that, compared to 
crude oil? Compared to crude oil in 
barrels. 
You can hear the showing the two 
together, stacked together. 
The dark blue is the production of oil in 
million barrols a day and we see how it 
declined from 1981. 
Down to 2008, where it hit about two 
thou--uh 5 million barrels a day and now 
has increased up to about 6 million 
barrels a day. 
So, out here. 
So it's 6 million barrels per day here, 
and, and here it was down about 5.7 or, 
5, point 5, so, oil production has 
increased. 
And, and natural gas liquids have 
increased also by this amount right here 
compared to this back in 2008. 
So it hasn't, it, it, it does add to the 
liquified petroleum production in the US 
and we'll get to the confusion over that 
and how Comparing these and adding 
natural gas liquids to oil is sometimes 
appropriate and sometimes totally 
inappropriate, and we'll see why that it 
might be inappropriate because they 
don't, they don't totally trade off you 
can't. 
Utilize 1 for the other and displace oil, 
for instance, with natural gas liquids on 
a 1 to 1 basis, well why is that? What 
are some of the uses for natural gas 
liquids? The natural gas liquids is 
dominated by the ethane, we mentioned 
before the chemical content and the 
different. 
components of natural gas liquids. 
And here they are listed again, ethane, 
propane, butane, isobutane and pentane. 
and but, you can see the largest 
percentage of natural gas liquids comes 
out as Ethane. 
Well how, how do we use ethane and how 
valuable is it to us? Well, it's made to 
make plastics and, and antifreeze. 
And the primary manufacturing sector that 
uses this is the manufacturing. 
For our plastics. 
So it's valuable to us and we're, we're 
using it in this case for the molecule. 
We're not burning that, that chemical 
molecule ethane, it's we're using the 
chemical, the module for the 
characteristics of the molecule. 
That allow us to make plastic, which of 
course is growing, and has grown for 
many, many, years. 
Propane as I already mentioned is comes 
from methane, is another component and 
it's used for home heating and gas 
grills,and is called, and liquified 
petroleum gas. 
Liquified petroleum gas here, the LPG 
that you hear a lot of the times, is 
generally a mixture of propane and 
butane, together but is dominated by 
building heating, most of the propane is 
used for heating of buildings. 
And also some for transportation. 
But you, we can run cars off of liquid, 
off of propane. 
just have tanks in the trunk, just like 
the tanks are a different shape and 
different size than we use in home 
grills. 
But we put them in cars and, and the car 
can run with a fairly inexpensive 
conversion off of propane. 
Butane is about 7% of the natural gas 
liquid production, issues for synthetic 
rubber, lighter fluids. 
And LBG again. 
Because LBG is a mixture of these 2. 
So those are used for magnets. 
Butane is used for manufacturing LBG. 
And again, some for transportation. 
In the colder climates, butane is a 
problem. 
Because when it gets cold, the pressure 
of the. 
the tank in the, of the butane liquid 
tank goes down. 
And in very cold weather it becomes 
atmospheric pressure of less, and you 
can't get it out. 
So, butane is mostly useful in the warmer 
climates. 
not the colder climates. 
The propane can be used in the colder 
climates as well as the warmer climates. 
Isobutane, what's its utilization? It's 
used in the chem, for chemicals, making 
chemicals and used in the gasoline 
refining process. 
And so, but the. 
Primary sector is manufacturing. 
And also some transportation there. 
But mostly manufacturing. 
pentanes. 
Pentanes, by the way, is, is different 
from the rest of these liquids. 
In that, it is liquid at, at atmospheric 
temperature and pressure. 
But it makes up about 14%. 
and. 
It's used in gasolines and polyn, 
polystyrene blowing, which is the foam. 
And it's used primarily for, for 
transportation because it's used in the, 
production and refinery of gasoline. 
So this gives us some clue about What 
some of the trade-offs and displacement 
might occur of liquid, natural gas 
liquids with crude oil. 
So if we produce an extra barrel of 
natural gas liquids, will it decrease and 
substitute for a barrel of oil? Well, 
probably not. 
Because, about at least, number 1 the 
ethane is not used in, in crude oil type 
of applications. 
so, and that's the biggest chunk. 
propane is used very little, it supplies 
maybe a tenth of a percent or maybe less 
of the transportation fuel. 
so right there you've got the dominant, 
the dominant, components of natural gas 
liquids. 
So you really can't displace, if you 
produce a extra Barrel of natural gas 
liquids, it doesn't displace and save a 
barrel of oil. 
they can't be done on a one-to-one basis. 
So, in many cases they shouldn't be 
lumped together. 
And yet, because natural gas liquids are 
up and the common term used for petroleum 
liquids, that includes natural gas 
liquids and crude oil, and by the way 
ethanol which we'll talk about later, is 
a more common term. 
And a lot of times, the production of, 
of, petroleum liquids will be reported. 
But, sometimes it can be a little bit 
like adding pounds of gold to pounds of 
silver. 
you can say, well I've got 20 pounds of 
gold and silver. 
But that doesn't really tell you anything 
about. 
The value of that 20 pounds. 
If you have to know the components then 
you have to know what each one's worth. 
So the value of the natural gas liquids 
relative to oil. 
Which is the one that we have an import 
problem with, which we've seen a little 
bit already. 
Is not nessesarily solved with. 
natural gas, liquids. 
But if you approximate it, somewhere 
maybe one barrel of natural gas liquids 
will displace about a third of the barrel 
of oil. 
Because their use in the gasoline 
refinery processes, etc. 
Matter of facts, I've read some articles 
lately thee in the chemical industries 
and the, the fossil fuel industries, 
little worried about how they're going to 
use these natural gas liquids, with all 
this increased production. 
Because the, the demand in the market 
place may not be there for continuing 
increased natural gas liquids. 
So all fossil fuels are not made the 
same. 
Obviously we can't for instance throw a 
chunk of coal into our car. 
And run our car with it. 
So coal and oil is not equivalent, 
natural gas liquids and oil is not 
equivalent either. 
So, but if we add, excuse me, if we add 
petroleum liquid, excuse me US liquid 
petroleum and we look at the percent 
imported. 
Then we come up with a different number. 
Crude oil plus natural gas liquids. 
we won't look at this slide too much, 
we'll call all talk more about this issue 
more later. 
But you hear different. 
different numbers about what percent of 
our energy and oil da, do we import 
versus produce here. 
And if you add natural gas liquids to 
oil, which this one does, where we, 
whereas we got about 60% before, it's 
about 55% or a little less. 
This, in the case of, you, liquid 
petroleum. 
what's the other use, shorts of the other 
transportation fuels? I mentioned natural 
gas liquid as transportation fuel. 
the, gasoline of course is the big one at 
72%, diesel at 23% but the other one is 
ethanol Which is 5%. 
We're going to look at this in the next 
lecture. 
And you can see compressed natural gas, 
bio-diesel and propane. 
When you round them off, it's less than 
half percent of the total transportation 
fuel. 
So natural gas liquids are not real 
important, significantly important in our 
transportation days. 
Thank you.