Skip to comments.Startup turning natural gas glut into gasoline
Posted on 03/11/2013 11:02:28 AM PDT by thackney
America is awash in natural gas, thanks to the controversial practice of fracking.
Now a San Francisco startup company, Siluria Technologies, has a new way to turn that gas into chemicals, jet fuel and gasoline.
The ability to make liquid fuels from natural gas has existed since the 1920s. But up to now it hasnt been cheap, requiring high heat and pressure to work. Silurias technology needs less heat and less energy and therefore costs less. The company is gearing up to build its first demonstration plant. And it has hired a new chief executive officer with deep experience in the chemical industry to guide Siluria out of the lab and into the marketplace.
Theres going to be this long period of time when we have this excess gas, said Edward Dineen, the new CEO. If you believe that, and I do, then having technologies that give you better options for that gas would make sense.
Dineen most recently served as CEO of LS9, a renewable fuel and chemical company in South San Francisco. He also held executive positions at LyondellBasell Industries and Arco Chemical Co. Siluria has raised $66 million in venture capital to date, from such investors as Bright Capital, Kleiner Perkins Caufield & Byers and Lux Capital.
Siluria is looking to capitalize on Americas natural gas boom. The process of hydraulic fracturing, better known as fracking, has unlocked large gas deposits trapped in shale rock beneath Ohio, Pennsylvania, West Virginia and other states. Natural gas prices have plunged as a result.
Companies are now trying to build export terminals that could ship the gas abroad in liquid form. But until those terminals materialize, prices will likely stay low.
The company was founded in 2008, spun out of another called Cambrios Technologies Corp. Its 40 employees now operate out of an office in Mission Bay, near UC San Franciscos hive of medical research.
Silurias conversion technology uses chemical catalysts picked by a screening system that can test hundreds of potential catalysts each week. Through a process known as oxidative coupling of methane, the catalysts help combine methane molecules into ethylene. The ethylene molecules can then be strung together in chains to produce gasoline, jet fuel or polymers.
The most common process for making liquid fuels from natural gas or coal, a process known as Fischer-Tropsch, needs temperatures on the order of 600 degrees Fahrenheit. Dineen wont specify the temperature needed for Silurias process, but says it is far lower. It is also less complex, requiring less-specialized equipment.
As a result, Siluria may turn natural gas into a direct competitor with oil. The startups process may be able to make chemicals and fuels at a cost competitive with or lower than the cost of similar products made from crude. The company plans to open a demonstration plant next year, although it has not yet announced a location.
The key challenge for us now is scaling up, Dineen said. This is certainly a technology that has global applications.
What could go wrong?
(on the other hand, I think that a well managed nuclear facility is ok....)
hypocritical? maybe nuts?
ok, don't answer that.
I am in a wait and see mode on this one.
Waiting to see if they “need government assistance” to get this process off the ground.
If the process is viable, they will not need any government assistance.
And... I live less than a mile from an underground gasoline pipeline.
And... one of my frequent work locations is 700 feet away from that same pipeline.
Maybe I should write a book: How I Learned to Stop Worrying and Love the Gas.
San Francisco, there fore eath quake prone destruction, therefore bad
Why would anyone want to change the properties of a product that is already efficient and useful in it’s natural state?
Just like a Crude Oil Refinery, it works well when kept inside the pipes.
Because it is far more valuable as liquid transportation fuel. The value per BTU is 8~10 times higher as gasoline.
Probably the installed base of gasoline-powered internal combustion engines has something to do with it. A lot easier (goes the thinking) to change gas into gasoline than to retrofit every vehicle out there to work on natural gas.
They will be based out of Texas in the next year or so. The regulations Kalifornia will impose on them will put them out of business.
Turn the American genius on to this problem and in a few years the Greenies and hate-America types will be going crazy with frustration.
If the germans were doing it... for a profit, I’d have no problem. But with all the “green incentives” being tossed around like candy by our criminal govt, every upstart energy project/company should be looked at with suspicion, since they are most likely simply collecting free government money.
Anybody got an idea how this impacts the carbon issue? I would assume gasoline would release the same carbon whether it was made from NG or oil.
The best part is that it won’t be too much longer that the middle east and Venezuela for that matter will be awash in crude, with no where to go with it. Get me my violin. :)
But also remember.... 99+% of vehicles in the US do not run on NG. And from my persepctive, I am not too hip on having a NG cylinder strapped to my vehicle.
If the technology is truly there to cost effectively convert NG to gasoline..... this will be a true game changer.
I would think “cost effectively” is the key term here. Conversion of natural gas to gasoline in a pilot plant is one thing, conversion on a commerical scale to make it worthwhile is a different matter.
still sounds like Fischer-Tropsch to me...that’s been around >60 years.
The crux of their whole proposal is the break-even point in cost comparison to gas refined from oil, and the whole future of the company depends on assumptions on future oil prices; they have to hope that increased tight oil production won't simply drop the cost of crude so much that it doesn't make sense to make gasoline from natural gas.
I definitely wouldn't invest in these guys unless it was play money. All their technology could be brilliant and work perfectly, but their business model could be destroyed by a massive crude price collapse to $50 a barrel or something. And they have no control over that.
Cost effective in the US. Under our price and regulation conditions. Shell, Sasol and I think some others already have commercial scale Gas-To-Liquid plants in other countries. Both have been looking to bring it to the US, if it can be done economically.
About Shell > Our strategy > Our major projects > Pearl GTL
Teams Work Uses a Virus to Convert Methane to Ethylene
A power producing gas turbine at say 25% efficiency can produce electricity from natural gas with copious exhaust gas at 900 DEGF.
Plenty of heat for a back end Fischer-Tropsch catalyst.
Yes, but also plenty of heat for an expander or some other use of the “waste heat.”
Keep in mind this is talking about a different process.
They’re more likely to get government interference.
The only ‘Government assistance’ they will get is to stop them from what they are trying to do...............
***** “I definitely wouldn’t invest in these guys unless it was play money” ******
I invested play money in Turkey Guts to Gas and lost Boardwalk and Park Place.
“Dineen most recently served as CEO of LS9, a renewable fuel and chemical company in South San Francisco”
That is all I need to know. Renewable=Subsidy.
Exactly. Case in point, in the early 80's oil recyclers and reclaimers were booming, rolling in the dough, and living the good life. By the mid '80's most of them became industrial metal graveyards and superfund sites.
Most operating crackers have a nameplate capacity in the 3-5 B lb. range per year. That would be a lot of hard working viruses there.
Fischer-Tropsch predates WWII, where the Germans used it.
It has been used by Sasol in South Africa, since the 1950s.
Now this guy promises a pilot plant next year, has raised $66 million.
As a fellow Californians, and not wanting to be too cranky, I wonder if this South San Francisco venture is science or finance?
It doesn’t seem like super high tech, and I would expect the major oil and refining companies would be all over it, if it really makes sense and cents.
I’m all for the use of natural gas. The use of LP gas is used within the U.S. exisiting gasoline powered vehicles are easily converted to use LPG. BTW I heat my home with it. Seems it’s more efficient than fuel oil and a Hell of a lot cheaper.
Japan LNG imports in 2012 ranged from about $15 to $18 per million BTU (MMBTU).
WTI crude oil is about $93/bbl, at 5.8 MMBTU/BBL = $16/MMBTU.
Brent crude at $110/BBL = $19/MMBTU.
So there is a reasonable match in the cost of LNG shipments to Japan, versus the world crude prices.
Now to Natural Gas versus Gasoline in North America.
Natural Gas at the Henry Hub is running about $3.50 per MMBTU.
Gasoline is generally 8 gallons per MMBTU, so at $3.50 a gallon that is $28 per MMBTU
So natural gas is 1/8th the cost of gasoline per MMBTU.
Liguid gasoline is roughly worth 8 times more than natural gas.
This leaves a good amount of margin for a cost-effective NG to Gasoline conversion process here at home.
THIS is also why we need to develop LNG exports, there is a big market for this as well. All in all, exporting LNG and bringing $’s into the US is a good thing.
“Anybody got an idea how this impacts the carbon issue?”
Quit parroting the BS that was fed you in the public doctronazation system and smarten up, CARBON ISN/T AN ISSUE!!!!!!!!!!!!!!!!!!!
WTI is the price at land-locked Cushing, Oklahoma. If you bring the same grade oil to the coast, it rises in value about ~$20/barrel. WTI has not represented world prices of light sweet for years. Brent is the new world standard and now trades a higher volume than WTI.
That is what it is now.
That is part of the point, these are the current economic conditions.
I’ve been in the oil business since 1977 so I’ve seen all the booms and busts in natural gas and crude prices for a while...
“I invested play money in Turkey Guts to Gas and lost Boardwalk and Park Place.”
What ever happened to that technology? It looked really promising.
If it can be produced from a heat source of the bio-mass/gasification process that uses bio-mass or garbage then it would be carbon neutral to make the environmental wackos happy.
This makes as much sense as turning Hostess Fruit Pies into Hostess Twinkies.
Rig your engine to burn natgas and move on.
You appear to get a lot of your exercise jumping to conclusions. Please point to anywhere I’ve said I believe carbon emissions are a major problem.
I agree with you. In fact an engine can be setup to run on either ‘natgas’ or gasoline, or diesel.
It would be a better use of capital to invent a type of pump you could deploy at a ‘gas’ station, that would dispense natural gas almost the same way you can get gasoline or diesel.
Set the pump up next to the others, and then provide a paid up license for the IP to all the car manufacturers that would allow for the connection of the new pump to a new nipple. You click the new hose fitting into the nipple, which seals around it, and then squeeze the handle like you would for gas.
Once the natgas tank is full, the pump shuts off automatically and processes the receipt - no ability to top off.
The company makes money selling the pumps to the gas station owners. It wouldn’t be long before the oil companies either bought nat gas interests, or a bunch of independent gas stations started popping up once you put the gallon price of nat gas (about $2.20) next to the price of gasoline ($4.00).
You cut the balls off of any politician that makes a move to tax it, and then every environmentalists wet dream comes to pass - cars running on cleaner fuel - only this time the average joe wins too when their commuting bill gets cut in half.
You’d also see the price of a gallon of gas drop through the floor.
The states would start screaming about their tax revenue losses, of course, never once wondering where all the extra retail sales tax revenue was coming from.
Gas taxes and cell phone taxes are the biggest scams going. Anybody that says government can do good things for people only have to have their noses rubbed in what could only be called bald-faced consumer fraud style taxation on their cell phones.
In fact, I’m shocked that gas stations never went to putting the retail price of gas up on their boards, followed by the tax price per gallon right underneath it. No law saying they can’t, they just don’t.
I have, but if you want granny to be able to fill her little car at a ‘gas’ station, the natgas pumps have to be as easy and safe to use as gasoline pumps.
The ones they use today require gloves, present a freezing hazard, and other issues.
No discussion there. Absolutely. It would have to be dummy proof.