Nitrogen-Rich Gas in the Permian’s Midland Basin Wreaks Havoc with LNG Liquefaction Terminals

 

     This is mostly a summary of RBN Energy’s recent blog about the subject. I also wanted to compare it to a similar situation I was in with a company producing gas with high nitrogen and CO2 content in part of a field in Southern Ohio. The situation was very similar in several ways and a bit different in some others.

     Nitrogen is an inert gas, which means in part that it doesn’t burn. There are other inert gases that naturally occur with natural gas such as CO2, helium, xenon, and a few others. All natural gas contains some nitrogen, but usually in very small, insignificant amounts. The problem with nitrogen and other inert gases is that they lower the heating potential, or BTU content, of the gas. Pipelines have specifications for BTU content and nitrogen content.

       In the Midland Basin portion of the Permian oil & gas play in West Texas, there are a few counties with exceptionally high nitrogen. Those counties also have productive oil & gas wells. That particular area also produces natural gas liquids (NGLs) at a high rate. As gas-to-oil ratios increase in the Permian plays the amount of associated gas produced increases. Since more gas is being diverted and will be diverted in the future to LNG export terminals from the Permian due to new pipelines, this is a problem that will have to be addressed more and more as time goes on.

     Nitrogen is especially problematic for LNG terminals. In addition to lowering the heating value/BTU content, nitrogen also takes up room, lowering the effective capacity of the LNG train. It is more problematic in terms of percentage for LNG liquefaction trains than for end-use consumers.

     As the graphic below shows the range of wellhead nitrogen content in the high-N2 Midland Basin area is variable from 1.1% to 5.4%. After gas processing plants remove NGLs the nitrogen content of the remaining gas stream is higher than it was before it went in. The main remedy is to blend that gas with low-nitrogen gas, first in gathering lines in the region, then in pipelines with gas from other regions. The LNG terminal has specifications that nitrogen content must be 1% or lower. Pipelines flowing out of the Permian typically have specs of 3% or lower total inert gases.

 

 

     Another remedy is nitrogen rejection units (NRUs) that some gas processing plants have in place. These are expensive. We looked into possibly having one built in Ohio, considering several designs, but the economics did not work out. Our gas was dry and did not have NGLs. RBN’s Rusty Brazel describes how NRUs work and the NRU dilemma as follows: “An NRU super-chills the natural gas stream after NGLs have been removed to effectively liquefy a portion of the gas plant’s methane output, leaving mostly nitrogen remaining as gas, and thus separated from the methane. Then the momentarily liquefied methane is re-gasified. The catch is, only about 30% of gas processing capacity in the parts of the Midland Basin with the highest nitrogen content has NRU capacity, and some of the capacity is less than fully utilized. NRUs are expensive to build and costly to operate. For the most part, they are a hassle.” He goes on to describe some other issues with Permian nitrogen content and LNG and how this is handled: “One other salient fact about Permian natural gas takeaway pipelines is this: The newer “bullet train” pipelines from the Permian (Permian Highway, Gulf Coast Express and Whistler) all bring relatively high-nitrogen gas straight into markets feeding LNG terminals. At the natural gas header system that collects gas from several pipelines and feeds it to an LNG plant, there are a number of gas trading/scheduling mechanisms that are used to further blend supplies to meet the LNG terminal’s nitrogen specs. Those specifications vary depending on the configuration of the LNG terminal. For example, Freeport LNG’s spec is a continuously policed, maximum 1% nitrogen, while Corpus Christi LNG’s spec is considerably more flexible. One reason is that Freeport uses electric compression, while Corpus uses gas-fired compression and can feed its higher-nitrogen boil-off gas into its compression for fuel.”

     The map below shows the general area of nitrogen-rich gas. The red is 6-8% nitrogen, and the green is 2% or less.

 

     Our gas in Ohio was comparable with one area having up to 10% nitrogen and even more total inert gases. Brazel notes that Midland Basin nitrogen content varies widely and is dependent on local geology. We found the same to be generally true in Ohio. We surmised that the nitrogen was being fed through deeper basement faults. We ran an aeromagnetic survey over the area that helped define the basement geology in the area as we were considering deeper gas plays. I looked at the lab-determined gas analysis for all of our wells in the field. We could then contour map the nitrogen content, and better for us the BTU content of the gas since there was also some CO2 making the total inert gases higher. I did this mapping and compared the trends to the basement faults interpreted from the aeromag survey. There was a fair correlation. The nitrogen-rich gas generally lined up along a few basement faults but most other areas along basement faults had lower concentrations. We were able to use the maps to avoid drilling wells with the lowest BTU. The wells we subsequently drilled matched the BTU mapping quite well. RBN’s N2 % map below of the Midland Basin area is somewhat similar.

 

  

     Permian gas from the Waha Hub goes in several directions, to the West, to the Gulf Coast, and to Dallas in Northeast Texas, as the map below shows. Thus, nitrogen management is an important issue in all of these areas. It will remain so until more NRUs are built, and blending is effected by those “gas trading/scheduling mechanisms.” In Ohio, we had a pipeline that went directly north from the low-BTU/high-N2 area that would sometimes be shut-in in the winter when it got cold, when there was not enough available gas to blend with it. The concern was that consumers’ furnaces would shut off with too much inert gas. It is inert gases like nitrogen and CO2 that are used to extinguish fires.

 

 

References:

 

It's A Gas Gas Gas, Encore Edition - High-Nitrogen Permian Natural Gas Mucks Up Texas Gulf Coast LNG Feedgas. Rusty Brazel. November 23, 2023. It's a Gas Gas Gas, Encore Edition - High-Nitrogen Permian Natural Gas Mucks Up Texas Gulf Coast LNG Feedgas | RBN Energy