GTL: Progress and Prospects - Study yields generic, coastal-based GTL plant

March 12, 2001
Research from various studies led by Foster Wheeler Energy Ltd. for Sasol Ltd. found that a generic 30,000 b/sd gas-to-liquids (GTL) plant based on Fischer-Tropsch technology can be constructed in a coastal site for less than $25,000/daily bbl in about 30-33 months.

Research from various studies led by Foster Wheeler Energy Ltd. for Sasol Ltd. found that a generic 30,000 b/sd gas-to-liquids (GTL) plant based on Fischer-Tropsch technology can be constructed in a coastal site for less than $25,000/daily bbl in about 30-33 months.

Presented here will be the background for design of such a plant.

Applications

Fischer-Tropsch-based GTL technology has been a widely discussed topic in recent years. Developers of the technology attest to its promise to solve a wide variety of industry's problems, including:

  • Monetization of stranded gas.
  • Reduction of flaring, both on and offshore.
  • Production of high quality, premium fuels.
  • A solution for Alaskan gas.
  • A competitor for LNG.
  • Floating applications.

Many of these proposals await commercial projects. Some remain in engineering development, while others have been abandoned entirely. But why the apparent lack of progress?

Developers continue actively to pursue the commercial application of GTL technology, especially when current high oil prices would make such projects economically feasible. In the last few years, however, developers have come to realize that GTL technology is more complex than once thought, as it carries with it several associated problems unique to its own particular processes.

GTL technology brings together several processes on a large scale; these include gas processing, industrial gas manufacturing, refining, power generation, and effluent treatment. Investments in GTL technology are comparable to those for a new grassroots refinery. In terms of cost and performance, therefore, considerable problems have surfaced that have taken longer than expected to resolve.

Cash-flow analysis

In any process-optimization exercise, the question of capital vs. operating costs will always arise. For more common plants, such as refineries, gas plants, or LNG plants, the optimal point is reasonably well understood. For GTL projects, however, obtaining an optimal point comes with its own set of problems.

The very nature of the GTL process itself is the main reason for these difficulties. Each of the traditional plants previously listed consumes energy, whereas Fischer-Tropsch plants produce energy. Fischer-Tropsch plants also consume very large quantities of energy, mainly for air separation.

Fig. 1 shows the portioning of negative cash flow for a GTL plant.

Capital expenditures are the dominant cost, highlighting the need for cost reduction. Feed and operating expenditures are also a significant portion of the cash flow, however, so that reduction in capital costs can only be driven down so far; otherwise, that reduction will adversely affect feedstock consumption.

What results from this analysis is a "self integrated" GTL plant, one which uses its produced energy to meet its own demands yet does not invest capital to make energy available for export. This configuration has proven to be an optimal model for FT plants.

The model also fits in with the standalone application that many of the plants will have for remote-gas utilization. This, however, does not preclude energy exports when favorable economic conditions exist, but it does show that the GTL plant viewed as an abundant source of free energy is a myth.It would be worth drawing some further assessments from Fig. 1 before examining in greater detail what it means for process configuration.

A gas price of $0.50/MMbtu was used in determining the economics. On an oil-equivalent basis, this translates into about $4.50/bbl of product produced. Since operating costs are roughly equal to feedstock costs, they are also roughly $4.50/bbl of product produced. Capital-cost cash flow is about double the feedstock cost, or $9/bbl.

Table 1 shows the attraction of GTL economics: production of oil-based products using gas-based economics. It also reveals the challenge-the fact that oil prices have to be around the upper teens for GTL to be economically attractive as an oil producer, rather than an "environmental" project to reduce flaring, whose economics are somewhat different.

Efficiency-process development

How do the economics translate into a plant's design?

It has already been established that a GTL plant needs a high level of cost-effective efficiency. That is to say, efficiency gains are required at relatively low cost and need to be targeted in the right places.

The usual calculation for the efficiency of a GTL plant is:

Efficiency = heating value of products/(heating value of feed + fuel)

Therefore, to increase efficiency, we can:

  • Make more product.
  • Decrease fuel consumption.
  • Decrease feedstock consumption.

From an economic point of view, products should be addressed before the feed is addressed because a 1% change in product demand has much more impact on the plant's economics than a 1% change in feedstock consumption.

This economic argument has influenced the GTL plant's design in the following ways:

  • Maximum recovery of hydrocarbon products.
  • Minimal use of natural gas for fuel.

(The decreased use of natural gas as a feedstock depends on continuing process and catalyst development and is beyond the scope of this article.)

Driving the proposed GTL plant to use its own energy efficiently can significantly reduce supplementary fuel-burning. The energy produced by a GTL plant is of three main grades:

  • Fuel produced by the process.
  • High-pressure steam from synthesis gas ("syngas") production.
  • Medium-pressure steam from Fischer-Tropsch synthesis.

The GTL plant also consumes energy in the following ways:

  • Fuel for synthesis gas generation.
  • Motive force for air separation.
  • Power generation for plant use.

A successful GTL plant's design, therefore, will enable it to balance its energy consumption with its production in a cost-effective manner.

This can be done through control of steam-generation pressures and through the configuration of turbines and heat sinks that use the energy. Although this resolves the issue of an optimized GTL plant, it does not, under normal operation, leave any spare energy for export.

Site-specific conditions may mean that a different design can be adopted, however, and energy would be available for export, but this would come at a price.

Engineering development

During the course of engineering development work, eight prefeasibility studies have been performed for a variety of worldwide locations and prospective customers. Also, three detailed feasibility studies have been conducted for offshore North Sea, Qatar (Ras Laffan), and Nigeria (Escravos).

At this time, significant engineering resources have been used by all parties and detailed engineering investigations have been performed.

Engineering activities have been broadly executed in the following areas:

  • Plot plan and piping arrangements.
  • Construction philosophy-in situ, modular, or barge-mounted construction.
  • Foundation and civil design and site preparation.
  • Heavy-lift studies (the plant includes some significant reactor vessels).
  • Risk management.
  • Standards and specifications.
  • Local development.
  • Environmental impact.

While Fischer-Tropsch-based GTL plants contain proven technology throughout the process, it became apparent that not all processes have been used together before, let alone constructed at the same time.

This realization resulted in considerable engineering challenges, which included examining constructability and heavy lifts (with large reactor vessels in an integrated site), and plot layout and piping minimization (with large scale utility systems).

Logically, a GTL plant of this scale and complexity should be constructed in situ, which is the construction method of choice for more developed sites. For remote locations, however, with minimal local infrastructure and resources, a modular design is preferable.

Commissioning and start-up are the final areas of development and are among the more schedule-critical tasks to be completed. The utility-intensive nature of the plant also makes provision of start-up equipment cost-critical because these will tend to be shut down once normal operation is achieved.

For remote locations, early start-up of certain areas of the plant is required to act as service providers for the remaining plant sections.

Generic plant

It was decided to consolidate all the analysis and to define a "generic," nominal 30,000 b/sd GTL plant-the design of which could be replicated anywhere in the world-that would act as a launching pad for basic engineering design.

The generic, in situ-built plant would be fed by an upstream natural gas plant that would remove bulk liquids and LPG from the stream. The gas, which would not contain heavy sulfur, would contain small quantities of H2S, which necessitates sulfur-removal guard beds in the process. The gas also contains a small percentage of CO2 and is at a pressure greater than 40 barg.

The standalone plant, with no integration with other facilities, would be designed to produce a nominal 30,000 b/d of (primarily) diesel fuel, with associated naphtha and raw LPG-LPG requiring ethane removal and drying. The site would be coastal, in a hot climate and average rainfall. Seawater would not be used to cool the plant, which would be predominantly air-cooled.

This plant would have optimal thermal efficiency and burn natural gas as fuel minimally. All of the plant's liquid effluents would be treated to World Health Organization irrigation-water standards, with some used internally as cooling water and the rest exported for local use.

All other required facilities, flares, buildings, and site access would be provided. Product export systems, however, would not. (These are frequently shared, due to the low occupancy required by the GTL facilities.)

The plant would be preassembled, primarily offsite, in order to minimize site congestion, but not modularized. The site would take advantage of some of the concepts of modular layout to ensure the most compact use of space, which would also have the added advantage of shortening the plant's pipe runs. The plant includes a number of air coolers, mounted high to avoid hot air recirculation.

This plot has been thoroughly designed with construction in mind, with the construction order, heavy-lift schedule, and early utility system start-up requirements considered and incorporated. Foundation and subterranean services also have been considered, and designs have been prepared for a variety of site locations and types.

The plant includes some significant civil structures for the effluent-treatment systems, which can be either below or aboveground.

The plant is compact enough for remote locations, where site preparation can be expensive, but optimized for constructability. It has been designed for reuse in any location in the world, with little change to the core process configurations.

As part of the engineering studies, parallel exercises to investigate the environmental and local community impact of such plants have been carried out, particularly for remote locations.

Ensuring smooth and incident-free construction, start-up, and eventual operation is crucial to the enterprise's success, while ensuring the environment is protected, and that local communities and services are enhanced and benefit from the project.

Capital costs

Capital costs for this GTL process were calculated by a combination of automated and manual techniques. In addition, all significant equipment was based on actual quotes, and benchmarked against in-house databases from recent projects, which resulted in an estimated accuracy of ±15%.

Obviously, any capital cost estimate must take into account the considerable local conditions, as well as the local customized plant design. However, for the purposes of this generic plant, the following criteria were used:

  • Generic Middle East location.
  • Cost factor equivalent to the US Gulf Coast.
  • In situ construction.
  • Process configuration as per generic plant.
  • Coastal location, with access to port facilities.

The total plant cost-including owner's costs, start-up, and commissioning and contingency-is less than $25,000/daily bbl. Equipment, materials, and labor were found to be $14,000/daily bbl, and total constructed cost was estimated at $17,000/daily bbl.

Fig. 2 shows the plant's capital cost breakdown.

As shown, the costs within the GTL process are widely spread across the entire plant, with the largest portion of the plant's capital costs going toward syngas production.

(For the purposes of this figure, the air-separation unit has been included with the natural gas reformer, as both units are required to produce syngas. Additionally, utility costs include all the boiler feedwater and start-up systems, but not the in-process steam generators.)

Note also that the cost of the actual Fischer-Tropsch synthesis unit is among the smaller expenses.

The capital-cost breakdown plainly illustrates the integrated nature and complexity of the plant, with systems and services widely distributed.

Schedule

While the variety of plant construction and design scenarios that were studied have a direct impact on capital cost in terms of materials, they also have a significant impact on the project's schedule.

A concerted effort has been made to shorten the project schedule. At the same time, the need to optimize the plant properly for a particular location had to be balanced with the assurance that costs would not increase as a result.

The generic plant is key to the overall schedule of the optimized project as it acts as a launching pad for early engineering activities. Fig. 3 shows a typical schedule.

The schedule was benchmarked against industry best practice in the regions under consideration.

This results in a competitive and challenging 30-month engineering, procurement, and construction schedule from award to ready for start-up. For a remote site, successful commissioning and start-up requires critical support utility systems to be ready several months before the project's end to allow for the remainder of the plant to be commissioned. This is critical for a plant, which during normal operation, relies on self-utility generation.

Table 2 compares three project and process measurements after 3 years of development. It summarizes the advancements made in recent years, covering process technology, cost control, and engineering execution.

These advances cover the full spectrum of a potential project, through process configuration, engineering, construction, and start-up.

The authors

Bahram Ghaemmaghami is a project director with Foster Wheeler Energy Ltd., Reading, UK. He is responsible for all of Foster Wheeler's current gas-to-liquids (GTL) projects. Most recently, this has included the proposed Ras Laffan venture in Qatar and Nigeria's Escravos gas project.

Simon C. Clarke is a senior process engineer for Foster Wheeler Energy Ltd. He holds a MEng in chemical engineering from Nottingham University and a post-graduate diploma in refinery business management. He is the author of numerous papers on refining, linear programming, CO2 management, and GTL technology.