U.S. Energy Information Administration logo

Natural Gas Processing: The Crucial Link Between NG Production & Its Transportation to Market

January 20, 2006

This special report examines the processing plant segment of the natural gas industry, providing a discussion and an analysis of how the gas processing segment has changed following the restructuring of the natural gas industry in the 1990s and the trends that have developed during that time. It focuses upon the natural gas industry and its capability to take wellhead quality production, separate it into its constituent parts, and deliver pipeline-quality natural gas (methane) into the nation’s natural gas transportation network. Questions or comments on the contents of this article may be directed to James Tobin at James.Tobin@eia.doe.gov or (202) 586-4835, Phil Shambaugh at Phil.Shambaugh@eia.doe.gov or 202-586-4833, or Erin Mastrangelo at Erin.Mastrangelo@eia.doe.gov or (202)-586-6201.

The natural gas product fed into the mainline gas transportation system in the United States must meet specific quality measures in order for the pipeline grid to operate properly. Consequently, natural gas produced at the wellhead, which in most cases contains contaminants and natural gas liquids, must be processed, i.e., cleaned, before it can be safely delivered to the high-pressure, long-distance pipelines that transport the product to the consuming public. Natural gas that is not within certain specific gravities, pressures, Btu content range, or water content levels will cause operational problems, pipeline deterioration, or can even cause pipeline rupture (see Box, “Pipeline-Quality Natural Gas”).

Although the processing/treatment segment of the natural gas industry rarely receives much public attention, its overall importance to the natural gas industry became readily apparent in the aftermath of Hurricanes Katrina and Rita in September 2005. Heavy damage to a number of natural gas processing plants along the U.S. Gulf Coast, as well as to offshore production platforms and gathering lines, caused pipelines that feed into these facilities to suspend natural gas flows while the plants attempted to recover. While several processing plants in southern Mississippi and Alabama were out of commission for only a brief period following Katrina, 16 processing plants in Louisiana and Texas with a total capacity of 9.71 billion cubic feet per day (Bcf/d) and a prehurricane flow volume of 5.45 Bcf/d were still offline 1 month following the two storms. Consequently, a significant portion of the usual daily output that flowed into the interstate pipeline network from the tailgates of these plants was disrupted, in some cases indefinitely.

In 2004, approximately 24.2 trillion cubic feet (Tcf) of raw natural gas was produced at the wellhead.6 A small portion of that, 0.1 Tcf, was vented or flared, while a larger portion, 3.7 Tcf, was re-injected into reservoirs (mostly in Alaska) to maintain pressure. The remaining 20.4 Tcf of “wet”7 natural gas was converted into the 18.9 Tcf of dry natural gas that was put into the pipeline system. This conversion of wet natural gas into dry pipeline-quality natural gas, and the portion of the natural gas industry that performs that conversion, is the subject of this report.

See full report