Economics of GTL Plants
- Faleh Tawfiq Al-Saadoon (Texas A&M U.-Kingsville)
- Document ID
- Society of Petroleum Engineers
- SPE Projects, Facilities & Construction
- Publication Date
- March 2007
- Document Type
- Journal Paper
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- 2007. Society of Petroleum Engineers
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A unique approach for assessing the economic viability of gas-to-liquid (GTL) plants is used. The capital expenditures (capex) are based on the production of 1 bbl of hydrocarbon liquid per day (BLPD), whereas the annual operating expenditures (opex) are expressed as percentages of capex. Both expenditures cover the range of costs envisioned by various vendors and investigators. It is assumed that the overall thermal efficiency of GTL plants is approximately 60% and that the plant operates 334 days per year. The capital expenditures used in this study are U.S. $20,000, $25,000, $30,000, $35,000, and $40,000 per BLPD. (Note: all expenditures in this paper are stated in U.S. dollars.) The annual operating expenditures used are 5, 6, and 7% of capex. Thus, the range of operating expenditures used is $3.03 to $8.48 per barrel of liquid hydrocarbon produced.
Two measures of profitability are used in assessing the economic viability of GTL plants, namely rate of return (ROR) and undiscounted payout time (POT). Rates of return used in this study are 10, 15, and 20%, whereas the payout times used are 4, 5, 6, 7, and 8 years. Construction periods of 3 and 4 years are considered in the analysis. A general survey of GTL processes is also included.
The conversion of natural GTL using the Fischer-Tropsch (F-T) process was first effected in 1923 with the conversion of synthesis gas (syngas) (CO+H2) into synthesis fuels (synfuels). The conversion is based on a three-step process: syngas generation, F-T synthesis, and product upgrading. The liquid products are stable at atmospheric temperature and pressure and may be transported with pipelines and/or standard tankers. Syngas Generation. The syngas-generation step involves a chemical reaction, reforming, wherein the hydrocarbon molecules of natural gas are broken down and stripped of their hydrogen atoms. Oxygen, introduced either in steam, in air, or as a pure gas, produces a mixture of hydrogen and carbon monoxide. The production of the ideal syngas calls for an H2/CO ratio of approximately 2, and both catalytic and noncatalytic processes have been developed. If necessary, the reforming step may be preceded by a feed pretreatment step to remove sulfur compounds such as hydrogen sulfide (H2S). In addition, other secondary/side reactions may proceed simultaneously during the syngas-generation step, yielding undesirable products, and thereby must be controlled (Gaffney, Cline & Assocs. 2001). These reactions may include:
- CO + CO à 2C + O2 (carbon formation reaction).
- CO + H2à C + H2O (carbon formation reaction).
- CO + H2O à H2 + CO2 (water/gas shift).
There are three basic types of reformers: the steam methane reformer (SMR), the partial oxidation reformer (POX), and the autothermal reformer (ATR) (Doshi 2002). A new plasma reformer also has been developed for the production of syngas from natural gas whereby electricity provides the reaction energy for the endothermic process (Blutke et al. 1999).
In the SMR, natural gas feedstock and steam at 20 atm and 500°C (with an exit temperature of approximately 800°C) pass over a nickel catalyst contained in tubes within a firebox. The heat of reaction is supplied by burning some of the feedstock. The SMR produces a syngas with an H2/CO ratio much higher than 2.0 and is thereby not ideally suited for producing synfuels. The theoretical H2/CO ratio is 3.0 (CH4+ H2Oà CO + 3H2), but the actual H2/CO ratio is 5.0 (75% H2, 15% CO, and 10% CO2) (Gaffney, Cline & Assocs. 2001).
In the POX, natural gas and oxygen are directly reacted without a catalyst. The POX produces a syngas with an H2/CO ratio much lower than 2.0 and is thereby not ideally suited for producing liquid fuels. It operates at an existing temperature of approximately 1400°C (Robertson 1999). The theoretical H2/CO ratio is 2.0 (2CH4+O2à 2CO + 4H2), but the actual H2/CO ratio is 1.8 (62% H2, 35% CO, and 3% CO2) (Gaffney, Cline & Assocs. 2001).
In the ATR, natural gas, steam, and oxygen at 1200 to 1500°C (with an exit temperature of approximately 800 to 1000°C) pass over a bed of nickel in the reaction vessel. The combustion reaction is rapid and exothermic and, therefore, autothermal. Because the ATR results in an H2/CO ratio of approximately 2.0, the process is best suited for the production of synfuels. To provide oxygen, an air-separation plant or other special provision may be required to resolve nitrogen-related problems. The theoretical H2/CO ratio is 2.3 (3CH4+H2O+O2à 3CO + 7H2), but the actual H2/CO ratio is 2.0 (64% H2, 32% CO, and 4% CO2) (Gaffney, Cline & Assocs. 2001).
Table 1 provides a summary of the advantages and disadvantages of the various syngas generators (Doshi 2002; Wilhelm et al. 2001).
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Blutke, A.S., Bohn, E.M., and Vavruska,J.S. 1999. Plasma Technology for Syngas Production for Offshore GTL Plants.Managing Associated Offshore Natural Gas meeting, Houston,28-30April.
Doshi, M. 2002. Conversion of Natural Gasto Liquids Using GTL Technology: Process Comparisons and Process Economics.Graduate research project, Texas A&M U.-Kingsville, August 2002.
Gaffney, Cline & Assocs. 2001.Potential of and future prospects for a Gas-to-Liquid (GTL) Industry inAustralia. Report submitted to the Commonwealth Dept. of Industry, Science andResources (DISR), Australia.
Robertson, E.P. 1999. Options forGas-to-Liquids Technology in Alaska. Prepared for the U.S. Dept. of Energy,INEEL/EXT-99-01023 (December 1999).
Turton, R., Bailie, R.C., Whiting, W.B.,and Shaeiwitz, J.A. 2003. Analysis, Synthesis, and Design of ChemicalProcesses, 2nd edition. Upper Saddle River, New Jersey: Prentice HallInternational Series.
U.S. Dept. of Energy. 1995. EconomicEvaluation and Market Analyses for Natural Gas Utilization. Draft Report (15April 1995).
Vosloo, A.C. 2001. Fischer-Tropsch: aFuturistic View. Fuel Processing Technology 71:149-155.
Wilhelm, D.J., Simbeck, D.R., Karp, A.D.,and Dickerson, R.L. 2001. Syngas Production for Gas-to-Liquids Applications:Technologies, Issues and Outlook. Fuel Processing Technology 71:139-148.