Skip to comments.Gas-to-liquids plants face challenges in the U.S. market
Posted on 02/19/2014 10:36:43 AM PST by thackney
Gas-to-liquids (GTL) is a process that converts natural gas to liquid fuels such as gasoline, jet fuel, and diesel. GTL can also make waxes. The most common technique used at GTL facilities is Fischer-Tropsch (F-T) synthesis. Although F-T synthesis has been around for nearly a century, it has gained recent interest because of the growing spread between the value of petroleum products and the cost of natural gas.
The first step in the F-T GTL process is converting the natural gas, which is mostly methane, to a mixture of hydrogen, carbon dioxide, and carbon monoxide. This mixture is called syngas. The syngas is cleaned to remove sulfur, water, and carbon dioxide, in order to prevent catalyst contamination. The F-T reaction combines hydrogen with carbon monoxide to form different liquid hydrocarbons. These liquid products are then further processed using different refining technologies into liquid fuels.
The F-T reaction typically happens at high pressure (40 atmospheres) and temperature (500o-840oF) in the presence of an iron catalyst. The cost of building a reaction vessel to produce the required volume of fuel or products and to withstand these temperatures and pressures can be considerable. Several companies are pursuing an alternative method that uses a different reactor design (called a micro-channel reactor) and proprietary catalysts that allow GTL production at much smaller scales.
There are currently five GTL plants operating globally, with capacities ranging from 2,700 barrels per day (bbl/d) to 140,000 bbl/d. Shell operates two in Malaysia and one in Qatar, Sasol operates one in South Africa, and the fifth is a joint venture between Sasol and Chevron in Qatar. One plant in Nigeria is currently under construction. Three plants in the United Statesin St. Charles, Louisiana; Karns City, Pennsylvania; and Ashtabula, Ohioare proposed. Of these, only the St. Charles facility is a large-scale GTL plant. In December 2013, Shell cancelled plans to build a large-scale GTL facility in Louisiana because of high estimated capital costs and market uncertainty regarding natural gas and petroleum product prices. The Annual Energy Outlook 2014 (AEO2014) Reference case projection does not include any large-scale GTL facilities in the United States through 2040. Other uses for available natural gas in industry, electric power generation, and exports of pipeline and liquefied natural gas are more economically attractive than GTL under AEO2014 Reference case facility cost assumptions and energy prices.
To improve the long-term profitability of GTL plants, developers have reconfigured their designs to include the production of waxes and lubricating products, which are another primary product of the F-T process. Because of the smaller size of the chemical market, smaller-scale GTL plants similar to those proposed in the Midwest are economically viable. U.S. imports of waxes similar to those produced out of the F-T process have experienced steady growth over the past decade because of increased demand in the chemicals market. F-T waxes are used in industries producing candles, paints and coatings, resins, plastic, synthetic rubber, tires, and other products.
Using projected natural gas and product prices in the AEO2014 Reference case and assuming a GTL plant can produce 2,800 barrels per day of products, a GTL plant is projected to be profitable only when it is configured to maximize wax production. As such, most GTL developers are looking to configure their plants to maximize wax production for the chemicals market instead of production of liquid fuels with minimum or no wax.
You can make syngas from wood, waste products, etc so having good F-T plants is a good idea.
Rather than flare gas off, GTL is an improvement.
Technically capable and economically profitable are both required. The first is done. The second is a lot harder in the US with GTL.
It is far more economically in locations where the supply is far larger than the local demand, like Qatar.
cost per unit of energy basis,
crude oil costs 5 or 10 times as much as NG.
there has to be a hitch somewhere.
perhaps someone here knows.
That would be the cost of converting to a liquid.
“The F-T reaction typically happens at high pressure (40 atmospheres) and temperature (500o-840oF) in the presence of an iron catalyst.”
Funny. Sounds almost like the conditions you might expect to occur deep in the Earth’s crust, where we find plenty of petroleum products. We also know methane can be an abiotic product, since we find it on planets where there never was life.
Could abiotic methane just be undergoing a similar reaction naturally, to produce the more complex hydrocarbons?
Despite the ample supplies of natural gas in the area, the company has taken the decision that GTL is not a viable option for Shell in North America, at this time, due to the likely development cost of such a project, uncertainties on long-term oil and gas prices and differentials, and Shells strict capital discipline.
Understanding that Carbon and Hydrogen, in an Oxygen deficient environment, eventually combine to its lowest energy state of Methane and depending on the element ratio, percentages of ethane and the like, is far different than proving a abiotic PRODUCT from another process.
I seem to remember an article that stated a Texas university, I believe it was Texas A&M, had developed a modified, more economical version of the FT GTL approach. Any further info?
prices, last time I looked.
diesel, $2.50 a gallon wholesale,,, 140,000 btu.
NG, at Henry, 1 million btu, $4.00.
do the math, even if half is lost,
Still just a pilot after many years. They seem to be selling lectures and presentation, not process licenses or product.
Do you think Shell, who has three of these plants in commercial operation in other countries, can not do math?
You guess at half product loss does not consider energy input and capital expenses.
Hell with this, why aren’t we gasifying coal, Sasol-style? The US isn’t a country so much as an enormous coal deposit with some dirt on top.
(Not that we shouldn’t do this too)
Press release -> spokes-speak to English conversion -> “There’s too much risk involved in building anything chemical- and energy-related in a country with an out-of-control E”P”A and a commie TOTUS”
I don’t trust Shell.
perhaps they never wanted to succeed
other companies seem to be interested.
Remember that Sasol (and Germany) went FT on coal because they couldn’t get enough liquid fuel at any price. Prices matter.
There is a reason their Coal-to-Liquid commercial operation has not be built in any other country, in spite of their many years of marketing it.
They have had success in selling GTL technology.
Right... That is why they own the largest GTL plant in the world.
Hence LNG ships I guess.
Closer to 3~3.5 times as much. Then you have to guess how much Natural Gas is going to rise while it becomes used by more and more transportation demands.
Energy Price Spread: Natural Gas vs. Crude Oil in the US