Continuing his discussion of the lights and the ultra-lights, Richard Zeits has a new essay on US condensates
over at SeekingAlpha:
- condensate for delivery in Asia are commanding strong premiums over crude benchmarks
- U.S. condensate producers are well positioned to grow volumes in 2018, notwithstanding fundamental uncertainties in natural gas
- U.S. super-rich gas plays have seen activity declines in the last three years but may experience a revival in 2018
- Bakken oil: approximately 50° API
- ultra-lights: 55.1°+ API
Condensates are typically low-sulphur crudes and are characterized by
a low cost to process. Naphtha yields are obviously high (naphtha is
used as gasoline blending components and petrochemical feedstocks).
However, it is important to remember that heavier condensates also have significant middle distillate yields.
Naphtha-based
ethylene margins in northeast Asia and middle distillate margins have
been excellent in the last few months. At the same time, the supply of
light sweet crude to Asia tightened a month ago due to the unforeseen
interruption on the Forties Pipeline. As a result, demand for condensate
has not been fully satisfied.
Another great introduction to condensates. Archived.
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