Executive Summary:
Infrastructure: US fractionation is becoming a major NGL bottleneck, with Mont Belvieu nearing capacity limits. East Daley expects utilization to exceed 101% in 1Q26, signaling operations beyond nameplate capacity.
Exports: Total US NGL exports saw a mild 4.9% W-o-W decline in the week ending Jan. 30. Ethane exports rose 5.7%, but the gain was offset by a 7.4% drop in LPG exports.
Rigs: The total US rig count held steady during the week of Jan. 24 at 522 rigs.
Flows: US natural gas volumes in pipeline samples averaged 65.8 Bcf/d for the week ending Feb. 1, down 4.3% W-o-W.
Calendar: Basin S&D Update
Infrastructure:
Fractionation capacity is an underappreciated constraint in the US NGL value chain, and the limits are being tested. Rapid growth in NGL supply has most fracs running at full throttle, with bottlenecks beginning to surface at Mont Belvieu. In the NGL Hub Model, East Daley Analytics expects fractionation utilization to edge above 101% in 1Q26, signaling a market operating beyond nameplate capacity.
Y-grade output from gas processing plants must be fractionated into purity products before it can be consumed at scale, making fractionation a critical step in the value chain. When capacity is tight, even minor disruptions can cascade through the system: Y-grade inventories build faster than they can be processed, forcing barrels to back up into storage.
East Daley expects capacity to loosen in 2Q26 with the startup of Targa Resources’ (TRGP) 150 Mb/d Train 11, followed by Energy Transfer’s (ET) 165 Mb/d expansion in 4Q26. Even so, we expect Targa’s new capacity to fill quickly, with total Mont Belvieu utilization once again edging above 100% in 3Q26.
See East Daley’s NGL Hub Model for more detail. We forecast an average quarterly contribution of $215MM from Targa’s Logistics and Transportation assets, which include fractionation assets. Fractionation remains the choke point in the NGL value chain, and control of capacity will determine who captures value as production continues to grow.
Exports:
Total US NGL exports saw a mild 4.9% W-o-W decline in the week ending Jan. 30. Ethane exports rose 5.7%, but the gain was offset by a 7.4% drop in LPG exports.
Marcus Hook posted a strong rebound, with LPG exports rising 146 Mb/d W-o-W. However, this was outweighed by a combined 317 Mb/d decline across other terminals, resulting in a 7.4% drop in total LPG exports.
Neches River recorded a 66.8% plunge in ethane exports, but the decline was offset by gains at Morgan’s Point. Across the remaining terminals, total ethane exports still edged up 5.7% W-o-W.
Rigs:
The total US rig count held steady during the week of Jan. 24 at 522. Liquids-driven basins increased by 2 rigs W-o-W, from 393 to 395.
- Permian:
- Midland (+1): Civitas Resources
- Delaware (-1): Civitas Resources
- Anadarko (+1): Continental Resources
- Eagle Ford (+1): Lewis
Flows:
US natural gas volumes in pipeline samples averaged 65.8 Bcf/d for the week ending Feb. 1, down 1.5% W-o-W.
Flows in major basins reflected continued impairments from Winter Storm Fran. The Haynesville sample declined 1.3% W-o-W to 8.8 Bcf/d, while the Marcellus+Utica slid 1.6% to 30.8 Bcf/d.
Samples in liquids-focused basins declined 2.9% to 17.0 Bcf/d, led by a sharp 13% drop in the Permian sample. However, the Anadarko and Bakken samples rose as operations began to recover from the winter storm.
Calendar:
