Turning water into wine

 By Nicholas Newman

Well perhaps not, anyway transforming one thing into another has been a quest of many in history. Well today, the impossible is becoming real, though it is still not possible to turn led into gold. Instead, it is possible to turn gas into useful chemicals such as petrol. Across the world, several companies have been working together, to convert, coal or gas into fuels that can power an engine or chemicals used in industrial processes…

The idea of turning base metals into gold, or of water into wine – has captured the imagination of men for centuries. Today, thanks to technological wizardry, the impossible is becoming a reality. While it is still not possible to turn lead into gold, or water into wine, it is possible to turn a gas into a useful range of fuels and chemicals. Across the world companies have been working to convert gas into petrol and diesel that can power an engine, or into the chemicals used for making plastics, medicines and cosmetics. In practice, this means that the diesel fueling a car in Qatar, Malaysia, Nigeria and South Africa is likely to be the product of a gas-to-liquids (GTL) process

GTL Process

Fischer-Tropsch (F-T) technology converts natural or waste gas into a range of high-quality, high-value energy and industrial chemical products including transport fuels, base oils, waxes, paraffins and naphtha. This technological process re-arranges carbon and hydrogen molecules to produce a heavier hydrocarbon molecule. The F-T GTL process starts with natural gas, mostly methane, and converts it to into a mixture of hydrogen, carbon dioxide and carbon monoxide, known as syngas. The syngas is then “cleaned- up” by removing sulphur, water and carbon dioxide in order to prevent catalyst contamination. The F-T process combines hydrogen with carbon monoxide to form different liquid hydrocarbons. These liquid products are then further processed using different refining technologies into liquid fuels or industrial feedstocks.

According to the EIA, a GTL plant producing 2,800 barrels of products a day can only be profitable when it is configured to maximize wax production. Therefore, most GTL developers are geared to maximize their wax production and target the chemicals market, rather than the liquid fuels market, which requires little or no wax.

Gas to liquids Process

Pioneers in GTL

In South Africa, SASOL, working with PetroSA and Royal Dutch Shell, pioneered the commercialization of the Fischer-Tropsch technology. PetroSA working with SASOL, completed the world’s first semi-commercial demonstrations of gas-to-liquids at their Mosul Bay plant in 1992, while Royal Dutch Shell produces a diesel from natural gas in a factory in Bintulu, Malaysia. The world’s largest GTL facility, Shell’s $19 billion Pearl GTL plant in Qatar, began production in 2011 turning natural gas into oil and chemicals used in plastics, detergents and cosmetics. In fact, Pearl GTL, with the capacity to produce about 30,000 barrels per day — enough to fill 225 million cars per year — is one of the world’s largest sources of lubricant base oil.

Large Scale GTL Plants

A number of proposals to build similar large-scale, gas-to-liquids plants have been put forward, by Sasol in Qatar, Shell at Lake Charles in Louisiana and Chevron in Nigeria. Meanwhile, in America, a large-scale GTL project, G2X Energy’s Big Lake Fuels Methanol plant located in Lake Charles, Louisiana, is on the starting block. It will produce 1.4 million metric tons of commercial grade methanol a year which will be converted into half-a-million gallons of petroleum products a day when production starts in 2020.

Fischer-Tropsch process components

However, the economics of large-scale GTL plants have been undermined by the mid-2014 collapse in oil prices. At an average capital cost of $11 billion and crude price of $100 per barrel, it was possible to make a profit from turning cheap gas into more valuable industrial chemicals and transportation fuels. Today, with crude oil prices at hovering just under $50 a barrel, the GTL process is no longer economically viable. Nevertheless, all is not lost for, since these plants have a design life of thirty years, there is plenty of time for oil prices to recover and for GTL plants to become profitable once more.

Small Scale GTL

While the prospects for new large-scale GTL plants are currently poor, those for small-scale GTL plants are looking brighter. In the US, new markets for small-scale GTL plants are opening up mainly due to the introduction of increasingly tougher environmental regulations and the availability of cheap associated gas, a byproduct of shale oil extraction. For instance, in North Dakota’s Bakken shale fields, local companies such as Primus Green Energy in Hillsborough, New Jersey, capture the associated gas and, using a small scale GTL plant, convert it into gasoline and methanol which is sold for use in cars and chemicals. “In fact some of it is used to power the generators that power the drilling operations, whilst the rest is used to clean up wastewater,” says William R Williams CEO Altresco Integrated LLC.

Nicholas Newman with Dr Laura Barrio (Principal Chemist) at the Velocys Laboratory in Didcot Oxfordshire

Elsewhere in the US, GTL is seen as a potential solution for tackling the gas produced from waste tips. Companies such as SGC ENERGIA and Velocys are providing the GTL technology for those wishing to turn this gas into something more profitable. A case in point is the GTL plant under construction next to Oklahoma City Waste Management’s East Oak landfill site. financed by a joint-venture between Waste Management, NRG Energy, and Ventech, using Oxford University’s startup Velocys technology. The feedstock for this plant will be a combination of previously landfill gas and pipeline natural gas.

The project will produce syngas, which can be blended with naturally occurring crude oil to produce ultra-clean diesel, kerosene (jet fuel), naphtha, bases for synthetic lubricants and waxes, among other “green” products. This new plant in Oklahoma City will come online later this year. A project such as this could be replicated to tackle noxious waste gas emissions from landfill sites, provide a cheap source of local renewable power and perhaps a new source of revenue for hard-pressed towns and cities. There is a modern magic to celebrate!

about the author
Nicholas Newman
Freelance energy journalist and copywriter who regularly writes for AFRELEC, Economist, Energy World, EER, Petroleum Review, PGJ, E&P, Oil Review Africa, Oil Review Middle East. Shale Gas Guide.