Natural Gas Processing 101: Understanding the Basics and Key Components

Natural gas is a versatile and abundant fossil fuel containing a variety of hydrocarbons, primarily methane, but also smaller amounts of other hydrocarbons such as ethane, propane, butane, and pentane. Often considered a bridge fuel in the transition to a low-carbon energy future, natural gas offers wide range of applications across various sectors including power generation, heating, and high-temperature industrial processes. 

McKinsey’s Global Energy Perspective 2023: Natural gas outlook projects global gas demand to grow past 2030 in all scenarios, with a total projected growth of between 10 and 15 percent. However, demand can differ greatly across various regions due to factors including the adoption of new technologies, local policies, and geopolitical influences, among others. With that evolving concept in mind, this article explores the basics and key components of natural gas processing. 

Key Trends Impacting Natural Gas 

• The power sector's reliance on gas may be challenged by the rapid advancements in battery technology, which are improving in both cost and load capacity
• An increase in gas supplies to Europe has the potential to impact global LNG demand, possibly leading to an oversupply in the market
• Growing awareness of the life-cycle emissions associated with natural gas and LNG, coupled with efforts to decarbonize, could influence the supply and demand of gas
• Recent inflation has caused cost increases for LNG projects that are currently under construction, potentially resulting in delays in their completion

LISTEN: Episode 11: Avoided Methane Emissions Into Revenue: Gas-to-Value Explained

Stages of Natural Gas Processing 
Natural gas, when extracted, is a mixture of various hydrocarbons and other impurities. The primary goal of natural gas processing is to separate these impurities and non-methane hydrocarbons to produce pipeline-quality dry natural gas. This processed gas is then ready for use in residential, commercial, and industrial applications, as well as for electricity generation.  
  
The stages include: 
#1 Separation: Initial separation of the gas from free liquids such as water and oil 
#2 Contaminant Removal: Removal of impurities such as hydrogen sulfide (H2S), carbon dioxide (CO2), and water vapor 
#3 NGLs (Natural Gas Liquids) Recovery: Extraction of NGLs like ethane, propane, butanes, and natural gasoline 
#4 Fractionation: Further separation of NGLs into individual components 
#5 Final Treatment: Final conditioning to ensure the gas meets pipeline specifications 
 
Upstream, Midstream and Downstream Natural Gas Treatment and Processing 
The upstream sector, also known as the exploration and production (E&P) sector, involves, as the name suggests, the exploration and extraction of natural gas. This includes searching for potential gas fields, which can be located either onshore or offshore, drilling exploratory wells, and operating the wells that bring crude oil and raw natural gas to the surface. Depending on the composition of the gas and the specifications of the final product, this may include initial processing steps such as phase separation, dehydration, and compression. 
 
Alternatively, the midstream sector is responsible for the separation, treatment, processing, storage, marketing, and transportation of natural gas, natural gas liquids (NGLs) like ethane, propane, and butane, and byproducts such as sulfur. Sometimes categorized as part of the downstream sector, midstream operations are crucial for bridging the gap between upstream extraction and downstream distribution. This stage often involves processes like phase separation, treatment, dehydration, processing, and compression. However, most gas processing plants that produce NGLs require a fractionator to meet sales specifications.

Lastly, the downstream sector focuses on the treatment and processing of raw natural gas, as well as the marketing and distribution of refined products. This includes the sale and distribution of processed natural gas and products derived from crude oil, such as liquefied petroleum gas (LPG), gasoline, jet fuel, diesel, other fuel oils, petroleum asphalt, and petroleum coke. Additionally, the downstream sector is responsible for distributing gas to transmission networks that supply power plants.

READ: 2024 State of Methane Emissions Regulations Around the Globe

Recent trends in natural gas processing highlight a focus on efficiency and environmental sustainability. Companies are investing in advanced technologies and innovative methods to reduce emissions and improve energy efficiency. For instance, advancements in cryogenic processing and membrane technologies are enhancing the recovery rates of NGLs and reducing the energy required for gas separation.

Furthermore, the industry is seeing a shift towards integrated processing facilities that can handle a wide range of hydrocarbons and impurities, providing greater flexibility and operational efficiency. The adoption of digital technologies and automation is also transforming the sector, allowing for real-time monitoring and optimization of processing operations.

Understanding the basics and key components of natural gas processing is essential for appreciating the complexities and advancements within the industry. From initial separation to final treatment, each stage plays a vital role in ensuring that natural gas is safe, efficient, and ready for use. As the industry continues to evolve, innovations and sustainability efforts will remain at the forefront, driving the future of natural gas processing. 

DOWNLOAD: Special Report: A Look at the 2024 Methane Mitigation Technology Landscape

To learn more about natural gas processing and managing emissions across the entire natural gas value chain, join us at our upcoming events:

Methane Mitigation Canada Summit
September 30 - October 2, 2024 | Hotel Arts, Calgary, AB

Methane Mitigation America Summit
December 3-5, 2024 | Houston, TX