Natural Gasoline

Natural gasoline is a liquid hydrocarbon mixture that comes out of natural gas processing. It is heavier than methane, ethane, propane, or butane, but lighter than the crude oil and condensate that show up at the wellhead. Chemically, natural gasoline is mostly pentanes, hexanes, and heavier compounds (often abbreviated C5+) with a vapour pressure between condensate and liquefied petroleum gas. It is a product of the deep-cut gas plants that strip natural gas liquids out of raw gas streams, and it is sold either as a finished product (blendstock for refinery gasoline pools) or as a diluent for heavy oil and bitumen pipeline shipments. The Western Canadian Sedimentary Basin is one of the world's largest sources of natural gasoline, where it has a particularly important role as the diluent that allows Alberta oil sands bitumen to flow through pipelines.

Key Takeaways

Natural gasoline is a stream of pentanes and heavier hydrocarbons (C5+) recovered from natural gas during processing. It is one of several products in the natural gas liquids family, along with ethane (C2), propane (C3), butane (C4), and isopentane.
Natural gasoline has a Reid vapour pressure typically between 9 and 14 pounds per square inch absolute, intermediate between butane (about 51 psia) and condensate (4 to 8 psia). The vapour pressure determines how it is shipped, stored, and metered.
Two main markets dominate natural gasoline use. The first is as a refinery blendstock for finished motor gasoline; the second is as a pipeline diluent for heavy oil and bitumen, where it cuts the viscosity of the heavy crude enough to allow pipeline flow.
The diluent market is concentrated in Alberta and the heavy-oil regions of Saskatchewan. Oil sands bitumen has a viscosity at pipeline temperature far too high to ship without dilution. Operators blend natural gasoline (and sometimes synthetic crude or condensate) into the bitumen to produce dilbit (diluted bitumen) at viscosities low enough for pipeline transit. The diluent demand from the Alberta oil sands has been a primary driver of natural gasoline imports into Canada from the US Bakken and Permian.
Natural gasoline pricing tracks crude oil and finished gasoline prices but with a discount that depends on regional supply and demand. Mont Belvieu, Texas, is the historic North American pricing hub for natural gasoline. Edmonton, Alberta, has emerged as a secondary pricing point reflecting the diluent demand from the oil sands.

Fast Facts

The Alberta oil sands consume roughly 600,000 to 700,000 barrels per day of diluent, much of it natural gasoline imported from the US through dedicated pipelines like the Cochin and Southern Lights systems. The diluent is blended into bitumen at a ratio of roughly 30 percent diluent to 70 percent bitumen, producing a stream that flows like medium crude oil through pipelines to refineries in Canada, the US Midwest, and the US Gulf Coast. The same molecules that started life as a tiny fraction of natural gas in a Texas Bakken or Permian well end up carrying Canadian bitumen across the continent and back to a refinery a few hundred kilometres from where they originally came up the wellbore.

What Natural Gasoline Is, in Plain Terms

When raw natural gas comes out of a well, it is a mixture. Most of it is methane (the lightest hydrocarbon), but it also contains a soup of heavier molecules: ethane, propane, butanes, pentanes, hexanes, and trace amounts of even heavier compounds. The heavier molecules condense at lower temperatures than methane, so a chilled processing plant can separate them out by stages, peeling off the liquid streams while letting the methane continue on to the pipeline as dry sales gas.

The pentane-and-heavier portion is what becomes natural gasoline. It is a clear, free-flowing liquid at room temperature, smelling much like the gasoline that goes into a car. It is technically not the same as motor gasoline (motor gasoline is a refined blend of many components including natural gasoline, but with octane improvers and other additives), but the chemistry is similar enough that natural gasoline is a major blendstock in motor gasoline production.

The defining property of natural gasoline is its vapour pressure. Vapour pressure is how much pressure the liquid needs to be kept under to stop it from boiling at a given temperature. Higher vapour pressure means the liquid wants to flash to gas more easily. Natural gasoline's Reid vapour pressure (9 to 14 psia) sits between butane (about 51 psia, which is a gas at atmospheric pressure) and condensate (4 to 8 psia, which is a true liquid). The intermediate vapour pressure means natural gasoline ships in regular liquid pipelines but is stored in pressurized tanks rather than open atmospheric vessels.

Where Natural Gasoline Goes

The two big markets are gasoline blending and bitumen diluent. The gasoline blending market is the older one. Refineries take crude oil and produce a slate of finished products including motor gasoline. The motor gasoline pool is a blend of components, and natural gasoline is one of the lighter inputs in that pool. Refineries in the US Gulf Coast, the US Midwest, and Eastern Canada all consume natural gasoline as part of their gasoline blending operations.

The bitumen diluent market is the newer one and has reshaped natural gasoline pricing across North America. Oil sands bitumen produced in northeastern Alberta is much too viscous to flow through pipelines on its own. Bitumen at pipeline temperature has a viscosity of around 100,000 centipoise, ten thousand times that of water. To ship it, operators dilute the bitumen with about 30 percent natural gasoline (or condensate, or synthetic crude), producing a blend called dilbit that flows like a medium-gravity crude. The diluent is shipped from production points (mostly the US Bakken, Permian, and Eagle Ford) into Alberta via dedicated diluent pipelines, blended into the bitumen at the production site, and then shipped out as dilbit to refineries.

The diluent demand is enormous. Alberta oil sands production runs around 3.3 million barrels per day in 2026. At a 30 percent dilution rate, that requires roughly 1 million barrels per day of diluent. Some of that comes from local Western Canadian condensate production, but several hundred thousand barrels per day of natural gasoline are imported from the US to make up the balance. The Cochin and Southern Lights pipelines are the main diluent import routes, each capable of moving over 100,000 barrels per day.

Natural gasoline is also called pentanes-plus, C5+, or stabilized natural gasoline (referring to the processing step that controls vapour pressure to a sales specification). In the diluent market it is sometimes lumped with condensate under the broader label "diluent" or "diluent-grade product." Related terms include natural gas liquids (NGLs, the family of light hydrocarbon liquids recovered from natural gas processing, including ethane, propane, butane, isobutane, and natural gasoline; together they form a major value stream of the gas processing business), condensate (a similar light hydrocarbon liquid produced directly at the wellhead from gas wells with high enough liquid-rich content to drop out as condensate at separator conditions; chemically similar to natural gasoline but produced upstream rather than at a gas plant), dilbit (diluted bitumen, the blend of about 70 percent oil sands bitumen with 30 percent natural gasoline or condensate that allows the heavy bitumen to flow through pipelines; the dominant export grade of Alberta oil sands production), gas processing (the suite of operations that strip water, sulphur compounds, CO2, and natural gas liquids from raw natural gas to produce pipeline-quality dry sales gas; the source process for natural gasoline production), and Reid vapour pressure (RVP, the standardized measurement of vapour pressure used to characterize gasoline-range products; determines storage and transport requirements; natural gasoline RVP is the property that distinguishes it from heavier condensate and lighter butane).

Why a Texas Pentane Carries an Alberta Bitumen Across the Continent

A pentane molecule originates in the Permian Basin of west Texas, produced from a gas well alongside methane, ethane, propane, butane, and other liquids. A processing plant in Mont Belvieu, Texas, separates the pentane-and-heavier stream as natural gasoline and ships it north on the Cochin pipeline. The pipeline crosses the US-Canada border at Sweetgrass, Montana / Coutts, Alberta, and continues to a delivery point near Edmonton.

At Edmonton, the natural gasoline is blended with bitumen produced from the oil sands at Fort McMurray. The blend ratio is set to bring the dilbit down to about 7 cP viscosity at pipeline temperature, low enough to flow at commercial rates. The dilbit is then shipped south on the Enbridge Mainline, the Keystone, or other heavy-oil pipelines, with destinations in the US Midwest (Cushing, Oklahoma; Wood River, Illinois) or the US Gulf Coast (Houston, Port Arthur).

The pentane that started in west Texas now arrives at a Houston refinery, where the bitumen-pentane blend is split back into its components by the refinery's distillation columns. The pentane fraction goes into the refinery's gasoline blending pool. The bitumen fraction goes to coker units that crack it into lighter products. The pentane has effectively done a round trip: produced in Texas, shipped to Alberta, used to dilute bitumen, shipped back to the Gulf Coast, and finally delivered to a refinery a few hundred kilometres from where it originally came up the wellbore. The Canadian oil sands industry consumes hundreds of thousands of these molecule-round-trips per day. The economics make sense because each leg of the journey adds value: the pentane enables bitumen mobility, the bitumen provides crude feedstock for the refinery, and the refinery produces finished products that the pentane could never have produced alone. The natural gasoline market is one of the more interesting examples of how integrated continental energy logistics have become.