SPE 165757-MS Gas to Liquids: Beyond Fischer Tropsch Philip E. Lewis, SPE, ZEEP Ltd. Copyright 2013, Society of Petroleum Engineers This paper was prepared for presentation at the SPE Asia Pacific Oil & Gas Conference and Exhibition held in Jakarta, Indonesia, 22–24 October 2013. This paper was selected for presentation by an SPE program committee following review of information contained in an abstract submitted by the author(s). Contents of the paper have not been reviewed by the Society of Petroleum Engineers and are subject to correction by the author(s). The material does not necessarily reflect any position of the Society of Petroleum Engineers, its officers, or members. Electronic reproduction, distribution, or storage of any part of this paper without the written consent of the Society of Petroleum Engineers is prohibited. Permission to reproduce in print is restricted to an abstract of not more than 300 words; illustrations may not be copied. The abstract must contain conspicuous acknowledgment of SPE copyright. Abstract The oil and gas industry has long sought ways of converting difficult to transport natural gas into easily transported liquids, especially from remote locations where local opportunities to market natural gas are limited. In recent years, interest in Gas To Liquids (GTL) has expanded beyond such “stranded” gas because of a widening spread between the market value of natural gas and hydrocarbon liquids even in locations with mature natural gas markets such as the USA. The Fischer Tropsch (FT) process is a well-known and established method of producing hydrocarbon liquids from natural gas; for some, it has become synonymous with GTL. This paper points out that commercial and near commercial alternatives to the FT process exist and may be commercially superior in some settings. The focus is on technologies that have been successfully piloted. Available alternatives to FT are primarily natural gas to methanol and methanol derivatives. Methanol synthesis is one of the most mature industrial processes and methanol annual production volume ranks among the top three products in the petrochemical industry. Traditionally, methanol has been primarily a precursor to formaldehyde and acetic acid. In recent years, methanol has achieved added importance as an precursor to olefins and motor fuels, including direct blending into the gasoline pool, and also as a precursor to many motor fuel products such as gasoline and MTBE, a gasoline additive still very important outside the U.S., and DME, a diesel fuel substitute. An Overview of the Fischer Tropsch Process Franz Fischer and Hans Tropsch filed their first patents in 1926, with their first U.S. patent granted in 1930. The FT process was a well known component of Germany’s World War II effort, providing 9% of its motor fuel and 25% of its automotive fuel from coal feedstock. In the FT process, synthetic, waxy crude is produced from syngas which may be produced from any carbonaceous substance (typically coal). Syngas is a mixture of carbon monoxide and hydrogen, via partial oxidation of carbon present in the coal: C H 2O Heat H 2 CO (1) Alternatively, syngas may be produced from natural gas, which will be discussed later. From syngas, the FT process produces a spectrum of hydrocarbons: (2n 1)H2 nCO Cn H(2n2) nH2O (2) CnH(2n+1) is the formula for alkanes, or saturated hydrocarbons, which in the case of FT, tend to be normal, or straight-chain isomers. The mean value of n is determined by catalyst, process conditions, and residence time, which are usually selected to maximize formation of alkanes in the range C5-C21. The lighter fraction, C5-C12, is separated as naphtha, which may be further refined into gasoline (which typically contains aromatic and branched hydrocarbon fractions). The heavier fraction, C8-C21, being straight-chain hydrocarbons, is suitable for direct blending into the diesel fuel pool. Heavier alkanes (waxes) may also be formed but are usually undesirable. One inescapable fact of FT chemistry is that more water will be produced than hydrocarbons (by mass). This produced water must be considered an undesirable sink for expensive and valuable hydrogen and also an unwanted waste stream. 2 SPE 165757-MS The naphtha fraction is not generally marketable and must be shipped to a refinery for further processing into gasoline blending stock. This explains why nearly all commercial FT plants, both those actually built and those proposed, have been associated with large refinery complexes. Recent efforts to improve the desirability of the FT process (commercially speaking) have focused on increasing selectivity for the diesel fraction and minimizing the naphtha fraction. With certain modification and modest post-processing, modern FT processes typically claim selectivity for diesel fraction of 75%, naphtha, 20%, and LPG is the remaining 5%. Until relatively recently, FT’s commercial history was limited to Germany in World War II and South Africa’s Sasol plants, situations were economics were subordinated to national security concerns in regions where coal was plentiful but oil and natural gas were scarce. National security concerns also dictated that the refining complex would be made available to facilitate large scale implementation of FT. These conditions do not generally apply to commercial, profit-seeking organizations. However, it has long been recognized that syngas, the precursor to the FT reaction, may be more economically produced from natural gas even when it is more expensive than coal, petroleum coke, or biomass on an energy content basis. Natural gas sourced syngas typically has greater reliability, less required syngas cleanup and much lower capital costs. Syngas production is in fact the single biggest cost component for the FT process, and probably for all GTL processes. In 1993, the first commercial scale natural gas fed FT plant started up, Shell’s MDS plant in Malaysia, producing 34,000 bbl/d of middle distillates and waxes which were further refined into marketable products. This plant was built in part to exploit inexpensive stranded natural gas that had limited conventional markets. Shell has since built and started the very large scale Pearl GTL plant in Qatar, producing 140,000 bbl/d of hydrocarbon liquids at a reported capital cost of approximately USD 18 billion. FT plants show a pattern of very large scale and associated large refining complexes to monetize the spectrum of products produced by the FT process. Two very large scale natural gas fed FT plants have been announced to take advantage of the recently plentiful and relatively low cost natural gas in North America. Sasol has announced a plant in Louisiana and Alberta, each with multiphase construction and with supporting refining complexes. Shell has also mentioned a very large scale Louisiana or Texas FT plant, but no details have been forthcoming. These plants follow the pattern of previous FT plants of very large scale integrated with a refining complex (Collings, 2002). Table 1 Fischer Tropsch Commercial Scale Plants in Operation or Announced Operator / Plant / Location Capacity, boe/d Feedstock Year started (expected) Sasol / Sasol I / Sasolburg, S. Africa 15,000 Coal 1955 / 1966 / 1975 Sasol / Sasol II / Secunda, S. Africa 55,000 Coal 1980 Sasol / Sasol III / Secunda, S. Africa 55,000 Coal 1983 Shell / MDS / Bintulu, Malaysia 12,000 NG 1993 Sasol / Oryx / Qatar 34,000 NG 2007 Shell / Pearl GTL / Qatar 140,000 NG 2011 Sasol / / Louisiana, USA 96,000 NG (2018) Sasol / / Alberta, Canada 96,000 NG (2020) Despite its long and successful history, there has never been, nor is there on the horizon, an example of an FT facility exploiting stranded natural gas at a remote location, nor of an independent gas producer (i.e., not integrated with a refining complex) monetizing gas via the FT process. Natural Gas to Methanol Methanol synthesis also enjoys a long history, actually preceding the FT process. In 1923, BASF first synthesized methanol on an industrial scale, also from coal-produced syngas. In the 1960s, the process was greatly improved by new ICI (now Johnson Matthey) catalysts that operated under much lower pressures. That process has been further improved through evolutionary development of many applications. The methanol synthesis reaction from syngas is 2H2 CO CH3OH (3) Note that there are no byproducts from the methanol synthesis reaction. It is true that other reactions will also take place in a methanol synthesis reactor, but with the proper maintained process conditions, the catalyst is highly selective and syngas SPE 165757-MS 3 conversion to methanol typically approaches 99%. This makes methanol synthesis one of the most efficient and selective processes in the industrial repertoire. To better understand GTL commercial issues, it is necessary to consider the first step which is common to all GTL processes: syngas generation. Syngas Generation As previously mentioned, syngas creation is the first step in both FT and methanol synthesis. Syngas may be created from a solid carbonaceous material in a gasifier, or from natural gas in a reformer. The two most common types of reformer are the steam methane reformer (SMR), and the auto thermal reformer (ATR). Each has their advantages, and in fact they are often used together in complementary fashion. Their dominant reactions are: SMR: CH4 H 2O Heat 3H 2 CO (4) ATR: 2CH4 O2 CO2 3H2 3CO H2O (5) Note that the SMR requires addition of steam, where the ATR requires addition of oxygen (CO2.and heat are provided by partial combustion, hence the name “auto thermal”). Generally, raising steam is much less capital and operationally intensive than producing oxygen, especially at smaller scales. Further, steam is generally available from waste heat recovery of methanol synthesis. As equation (1) shows, the desired syngas ratio (i.e., H2:CO) for methanol synthesis is 2. SMR and ATR produce syngas ratios of 3 and 1, respectively.