Quick answer: Natural gas liquids (NGLs) — ethane, propane, butane, and others — are valuable products extracted from raw gas, each with its own market and price. Because NGL revenues can be significant and move separately from gas, producers and processors often hedge NGLs alongside natural gas.

What are NGLs?

NGLs are heavier hydrocarbons separated from natural gas during processing. They command their own prices tied to petrochemical and fuel markets, giving producers exposure beyond the gas price itself — an important nuance for natural gas hedging.

Why hedge NGLs separately?

NGL prices do not always move with natural gas, so hedging only gas can leave NGL revenue exposed. Producers with wet gas often derive substantial value from NGLs, making separate hedging worthwhile.

How are NGLs hedged?

NGLs are hedged with product-specific swaps and futures where liquidity exists, managing correlation and basis to the gas position. Mobius Risk Group's hedge strategy solutions help producers hedge gas and NGL exposure together.

Frequently asked questions

What are natural gas liquids?

Heavier hydrocarbons — ethane, propane, butane, and others — separated from raw natural gas, each with its own market and price.

Why hedge NGLs separately from gas?

Because NGL prices move independently of gas, so hedging only gas leaves NGL revenue exposed.

How are NGLs hedged?

With product-specific swaps and futures where liquidity exists, managing basis and correlation to gas.