Where does propane come from?

Propane is primarily a byproduct of domestic natural gas processing, though some propane is produced from crude oil refinement. U.S. propane supplies are becoming increasingly abundant due in large part to increased supplies of natural gas.

• As shale gas extraction has increased, the production of propane from crude oil refinement has dropped dramatically. In 2011, 69 percent of the total U.S. supply of propane came from natural gas liquids produced in the U.S. and Canada.₁
• Strong growth in propane supply is expected to come from the Marcellus Shale Play in the northeastern U.S. Industry observers estimate the Marcellus Shale alone can supply more than 2 billion gallons of propane per year.₂
• Because of the drastic increase in U.S. sources of propane, the U.S. produces more than enough propane to meet current demand and became a net exporter of propane in 2011.₁

[1] ICF International, Propane Supply Sources and Trends, (Washington, D.C.: ICF International, August 2012), prepared for the National Propane Gas Association.

[2] 6. ICF International, 2012 Propane Market Outlook, (Washington, D.C.: ICF International, 2010), prepared for the Propane Education & Research Council.