free html hit counter Peak Oil Debunked: 60. GAS-TO-LIQUIDS (GTL)

Friday, August 26, 2005

60. GAS-TO-LIQUIDS (GTL)

Aaron from peakoil.com writes:
Oil traditionally comes gushing out of the ground from miles around in liquid form. In fact, we have to cap it off, so it stops flowing.
No matter what we decide to smash into liquid fuel, it won't be in the same ballpark as oil. Or on the same team... Or even the same sport...

Right now, I believe the #1 contender among synthetic oils is gas-to-liquids(GTL).

Mike Lynch has an interesting presentation(pdf) talking about GTL and other unconventional oils.

Unlike thermal depolymerization and coal liquefaction, people are putting down serious money for large-scale projects:
Shell signed a contract with Qatar Petroleum in October 2003 for a 140,000-bbl/d GTL facility to be built at Ras Laffan. The first 70,000 bbl/d of capacity is expected to commence operation by 2009, with the rest in 2010 or 2011. If completed, it will be the world's largest GTL plant.Source

This plant will be producing finished diesel, not crude oil, and diesel only accounts for about 20% of a barrel of crude oil Source. Which means the plant will be providing as much diesel as an ordinary crude source producing 700,000bbl/day. That's big. 140,000bbl/day of diesel constitutes about 3% of current diesel usage in the U.S. (4.2 million barrels/day -- source (pdf))

Qatar seems to be the center of GTL activity:
"We plan to spend six billion dollars on a major GTL plant in Qatar," Shell CEO Jeroen van der Veer told a Business Week conference in Paris, but gave no timeframe.
Shell signed a $5 billion deal in October last year with Qatar Petroleum to build a 140,000 barrels per day gas-to-liquids (GTL) plant, due to start in two stages with the first onstream in 2008-2009 and the second two years later.
Van der Veer added that by 2015 GTLs could meet three percent of world diesel demand.
GTL plants process natural gas into products such as diesel. Europe is short of diesel as oil refiners lack sufficient production capacity and demand is rising.
Qatar has racked up over $20 billion in GTL deals, as it seeks to cash in on its huge gas reserves. Source

The following is a revealing quote which shows you why GTL is going to happen before coal-to-liquids. Sasol, the world's leading coal-liquefier, prefers natural gas:
Under the belief that partially replacing coal with natural gas as the synthetic-fuel feedstock would reduce investment expenditures in coal mining operations, Sasol began importing gas from Mozambique in 2004.Source

As for Aaron's objection: Natural gas traditionally comes gushing out of the ground from miles around in gaseous form. In fact, we have to cap it off, so it stops flowing.

Of course, Aaron will point out the tremendously complex refinery apparatus which is necessary to turn natural gas into diesel. I will rebut by pointing out the tremendously complex refinery apparatus which is necessary to turn crude oil into diesel.

Also, natural gas is no more expensive per btu than oil (see #37). In fact, in many places (like Nigeria) it is worth nothing, and is simply flared.

7 Comments:

At Friday, August 26, 2005 at 5:56:00 AM PDT, Anonymous PB said...

GTL Liquid can replace 700,000 bbl of oil a day equivelant? Thats not bad but one years depletion of conventional oil at 3% is 2,520,000 bbl per day LOL

 
At Friday, August 26, 2005 at 6:19:00 AM PDT, Blogger James said...

PB: It's a start. And the output of one plant.

 
At Friday, August 26, 2005 at 6:28:00 AM PDT, Blogger JD said...

Thats not bad but one years depletion of conventional oil at 3% is 2,520,000 bbl per day

Conventional oil already peaked last year, according to ASPO (see #52). So, going by your figures, we must have lost 2,520,000bpd this year. And yet oil production is booming. How do you explain that?

 
At Friday, August 26, 2005 at 12:01:00 PM PDT, Anonymous Anonymous said...

seen oil prices, lately?

 
At Friday, August 26, 2005 at 1:08:00 PM PDT, Blogger James said...

Has more to do with speculators and the terror premium than actual shortages. If there were actual shortages, the price would spike $20 - $30 almost overnight. Speculators in retrospect, are doing us all a favor, forcing us to reduce our consumption in the absence of an actual oil shortage.

 
At Sunday, August 28, 2005 at 12:27:00 PM PDT, Blogger James said...

Speaking of shortages, Hurricane Katrina may do just that. Definitely bears watching.

Fill your gas tank today!

 
At Tuesday, September 29, 2009 at 5:40:00 PM PDT, Blogger DB said...

I love coming back to the failed predictions of the doomers.

PB said "GTL Liquid can replace 700,000 bbl of oil a day equivelant? Thats not bad but one years depletion of conventional oil at 3% is 2,520,000 bbl per day LOL"

A good thing that the hundred year supply of shale oil showed up then isn't it?

Seems we will be able to swap out the decline in production EVERY SINGLE YEAR for at least fifty years meaning that the switch to electric will be a snap.

DB

 

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