Lessons learned from operational problems on the first generation of gas-to-liquids (GTL) plants are being implemented and market conditions are now right to help the GTL industry take off. This was the message presented to the 8th World GTL Summit, organized by CWC Associates in London on 13-14 May, which heard progress reports on the worlds first full-scale commercial GTL projects: Oryx GTL in Qatar, which achieved only 60% of its 34,000 b/d design capacity after being brought on-stream in early 2007; Shells Pearl GTL in Qatar, planned to deliver 140,000 b/d of GTL products and 120,000 b/d of condensate, LPG and ethane, which was hit by rising costs during planning but is expected on-stream as planned at the end of 2010; and Nigerias Escravos GTL, a similar project to Oryx (MEES, 5 November 2007). Now Oryx GTL believes its initial operational problems have been solved, and is undertaking modifications, while Shell is planning to make best use of its experience in developing the 14,7000 b/d Bintulu plant in Malaysia, the worlds first commercial GTL project, brought on-stream in 1993.
The twin-train Oryx GTL plant is a joint venture between Qatar Petroleum (51%) and Sasol (49%). Output was lower than expected after start-up, because of a higher than anticipated amount of catalyst being carried through the process (MEES, 28 May 2007). ?Abd al-Rahman al-Suwaidi, Deputy General Manager of Oryx GTL, told MEES that modifications to one train had improved the break-up of catalyst to such an extent that 96% of its 17,000 b/d design throughput was achieved on test, and modification work had begun early last week on the second train. He added that the full 34,000 b/d throughput was expected to be achieved on a sustainable basis by year-end, by which it was meant that this level of output would be achievable in at least 340 days out of every 365.
Mr Suwaidi told the conference that the Oryx plant had been running at an output rate of about 20,000 b/d until the end of January, when it was shut down because of maintenance work on the upstream gas production facility. We took this as an opportunity for modifications and tie-ins, he said. When the plant was restarted in April, the 96% throughput level was achieved for the first train. He said that 12 GTL products shipments had been made from Oryx since April 2007 eight diesel cargoes and four of naphtha and that more than 2.5mn barrels of products had been successfully marketed. We have received interest from the market in long-term supply contracts, he added. This was requested by most of our customers because of the product quality.
Pearl GTL Planning Reflects Bintulu Experiences
Lars Carlsson, General Manager Assets, at Qatar Shell GTL, told the conference that the Bintulu GTL plant now operates with 99% reliability, but it took a lot of time to run the plant efficiently. He said that while project costs had escalated, it had robust economics, with a high value products slate linked to oil prices, to which they can be sold at a premium. Our unit development costs are below the average per barrel cost of Shells current portfolio of projects under construction, he noted. Project start-up was expected around the end of 2010, and development progress included: the beginning of development drilling in the offshore North Field; the erection of six reactors at the Pearl GTL site in Ras Laffan industrial city; the start of steel erection at the liquids processing sites; and the installation of machinery for the air separation units.
Pearl is a relatively low risk proposal, said Mr Carlsson. We will build on the experiences from Bintulu. The main scale-up will be for the gasifiers, at 3.5 times. Our conclusion is that the scale-up from the 14,700 b/d Bintulu plant to 70,000 b/d trains will mainly be a case of just more of the same. We are preparing already for a flawless start-up, including lessons learned from Bintulu and elsewhere. There will be comprehensive testing at every stage through to commissioning and start-up. We are working with proven technology, based on the commercial plant at Bintulu. The important area is operational readiness, and this is embedded in the project execution.
Oil Price Shield For GTL
Alirio Parra, Senior Associate at CWC Associates and former Venezuelan Minister of Energy and Mines, said it was interesting to reflect on the impact of this decades rising oil prices on GTL: In 2001, oil was $26-27/B, and the industry was nervous, thinking this could not be sustained and would affect the money flowing into the nascent GTL industry. Yesterday Brent closed at over $122/B. This price shield is providing strong market signals to an industry now ready to take off, with predictions that the GTL sector will grow strongly in the next 10-15 years.
Dr Parra said that there had been a repositioning of the drivers for GTL. Environmental factors are now top of the agenda, he observed, while a renewed pursuit of energy security reflects favorably on GTL. The growing importance of diversification of supplies for consumers is helped in the case of GTL by the fact that gas resources are more widespread than oil. There is a steady increase in consumption of transport fuels, which will outstrip other oil demand sectors in the future. And current oil prices are beyond anybodys calculations.
Copyright MEES 2008.
