WORLD GAS PROCESSING, SULFUR-RECOVERY CAPACITIES STILL GROWING

July 12, 1993
Warren R. True Pipeline/Gas Processing Editor The world's natural-gas processing industry continued to grow in 1992. Gas-plant capacities, volumes of gas the plants actually processed, and volumes of NGLs the plants produced all increased last year. The U.S. and Canada continued to lead the rest of the world in gas-processing capacity--more than 97.5 bcfd, throughput--nearly 65 bcfd, and production--more than 2 million b/d. The two countries also continued to lead the world in
Warren R. True
Pipeline/Gas Processing Editor

The world's natural-gas processing industry continued to grow in 1992. Gas-plant capacities, volumes of gas the plants actually processed, and volumes of NGLs the plants produced all increased last year.

The U.S. and Canada continued to lead the rest of the world in gas-processing capacity--more than 97.5 bcfd, throughput--nearly 65 bcfd, and production--more than 2 million b/d.

The two countries also continued to lead the world in petroleum-derived sulfur production with more than 56% of the world's capacity and production last year.

These trends are evident from Oil & Gas Journal's recent exclusive, plant-by-plant, worldwide gas-processing survey (p. 55) along with an international survey of petroleum-derived sulfur recovery (p. 93).

Among the gas-processing data this year for the first time are data from republics of the Commonwealth of Independent States (C.I.S.) which make up the largest portion of a new category covering areas of the former Communist Bloc (Table 1).

Among significant developments in 1992 were the start-up of Shell Canada's Caroline sour-gas plant in Alberta and completion of a fourth gas terminal and processing plant at St. Fergus, Scotland.

INDUSTRY TRENDS

Gas-processing capacity worldwide (outside the C.I.S., Eastern Europe, and China) gained 4% in 1992 and produced more than 16% more.

Throughput, following increased gas production outside North America, also improved, by more than 5%.

North America dominated activity again last year with Canada and the U.S. accounting for more than 59% of worldwide gas-processing capacity, more than 64% of throughput, and more than 57% of world NGL production.

The number of gas plants operating last year again increased, a trend that has been evident for 5 years. The 1987 number of 1,407 was an historic low.

Plant construction for expansions and new capacity slackened last year, however, as Table 2 makes clear. Nevertheless, new capacity was added in the U.S., Indonesia, and Egypt. A discussion of major projects for last year and the first half of 1993 rounds out a look at the numbers from OGJ's annual survey of operating gas plants.

Gas reserves are shown in Table 3; production in Table 4.

Canada and the U.S. continued as world leaders in petroleum-derived sulfur recovery in 1992, holding more than 56% of the world's processing capacity and production.

Worldwide production of petroleum-derived sulfur increased last year with Canada accounting for more than 32% of the overall total; the U.S., more than 23%.

U.S. PICTURE

Gas-processing capacity in the U.S. remained essentially flat last year--net lost capacity amounted to 235 MMcfd compared with 1991. Throughput was also flat, declining 44 MMcfd (Fig. 1).

Despite increases for C2S-C4s as processors modified operations to meet market demand, production also held steady -up by only 1.5 million gal (35,767 b/d).

The U.S. continued to hold the largest share of worldwide gas-processing capacity (almost 42%; Table 1).

The flat capacity and throughput figures reflect lower U.S. gas production. Processors also trimmed operations because of narrower margins: Natural gas prices recovered strongly in 1992--contrary to virtually every projection, and adequate supplies reined NGL prices.

The number of U.S. plants operating in 1992 continued the recent trend of shrinking (Fig. 2). For 1992, 6 fewer plants were operating in the U.S. than in 1991 when there were 2 fewer than in 1990. Since 1984, the number of plants operating in the U.S. has dropped by 154 (-17%).

Plant utilization, on the other hand, has continued a steady improvement since 1986, rising last year slightly when compared to 1991: 66.3% compared to 66.1%. In 1986, plant utilization rate stood at 55%.

U.S. capacity for 1992 reflects recent small changes: up less than 1% over 1991 which was up by 3.2% over 1990. Capacity since 1988 has increased 5.6%; in 1988, capacity declined over that for 1987.

Since 1984, U.S. gas-processing capacity has gained only about 4% (2.7 bcfd).

Throughput for 1992, however, bucked an upward trend after 1984 by remaining flat (-O.10%) over 1991. Since 1984, U.S. gas plant throughput has increased by 5.7 MMcfd (+ 14%).

NGL production for 1992 increased by 2.1% over that for 1991. Since 1984, production has increased by 22% (13,000 million gpd; 320,000 b/d).

STATE TRENDS

State-by-state comparisons of capacities, throughputs, and NGL production have been more precise since 1988.

For that year (OGJ, July 10, 1989, p. 46), Oil & Gas Journal survey data included for the first time specific, plant-by-plant throughput and production figures from Phillips Petroleum Co. in Bartlesville, Okla.

Phillips has been by far the world's largest processor of natural gas and producer of NGLS. With 1992 data, most of the plants previously operated by Phillips Petroleum have been reorganized under GPM Gas Co., Houston, a subsidiary of Phillips Gas Co., itself a unit of Phillips Petroleum.

Texas last year saw a slight decline in the number of plants processing gas and producing NGLS, from 303 for 1991 to 300 for 1992. The trend in Texas for some time has been to fewer plants: The state had 415 in 1983.

But capacity, throughput, and production all increased in the state last year: capacity was up by almost 300 MMcfd, throughput by 130 MMcfd, and production by more than 300,000 gpd.

Much of these increases resulted from the commissioning and operation late in the year of Valero's new 200-MMcfd Thompsonville plant near the Mexican border.

Continuing an historical trend, Texas' NGL production far out-distanced that of any other single state: more than 30 million gpd (more than 715,000 b/d).

Texas' share of 1992 U.S. processing capacity stood at nearly 25%, about the same as in 1991 and 1990. The state's portion of daily throughput was 24.5%; of production, 41%. Both levels are even with those for 1991.

Louisiana's gas-processing activity remained strong last year. With a decrease of only 1 plant handling gas in 1992, existing plants reduced capacity by almost 475 MMcfd and increased production by almost 1.2 million gpd (more than 28,000 b/d).

Expansions at Texaco Exploration & Production Inc.'s Henry and Sea Robin plants accounted for much of these increases.

The state's number of operating plants for 1992 slows a slide of recent years. Yet, the state continues to lead all states in processing capacity--18,338 MMcfd vs. Texas' 17,235 MMcfd, and in throughput--12,169 MMcfd vs. Texas' 11,390 MMcfd. Louisiana's plant utilization for 1992 was 66.4% compared with Texas' 66.1%. Both are even with the U.S. industry's average for the year.

For all U.S. plants, Louisiana's share of capacity was 26%, of throughput more than 26%, and of production more than 16%.

Louisiana and Texas held combined capacities in 1992 of 35.6 bcfd, representing 50.7% of total U.S. daily capacity; throughputs of 23.6 bcfd, slightly more than 50%; and NGL production of almost 42 million gpd (more than 997,000 b/d), 57%.

Contraction was evident in plant activity in Oklahoma: seven fewer plants were reported to be operating; capacity fell by more than 250 MMcfd, throughput by more than 220 MMcfd, and production by more than 800,000 gpd.

New Mexico, on the other hand, saw its plant capacity increase by more than 145 MMcfd, its throughput by 194 MMcfd, and its production by more than 331,000 gpd.

These increases were caused in part by changes at plants operated by GPM Gas Corp., Marathon Oil Co., and Texaco Exploration & Production Inc.

One plant that came on line late last year but failed to report 1992 numbers was Williams Field Services' 480-MMcfd Milagro plant, more about which presently.

Generally, U.S. gas processors continued to pursue petrochemical and gasoline-blending markets last year, even as natural-gas prices recovered in the second half and NGL inventories rose to squeeze processing margins.

The trend shows up in increases in 1992 ethane propane, and isobutane production reported by respondents to OGJ's annual survey:

  • Ethane production increased by more than 15%

  • Propane production increased by more than 8%

  • Isobutane production increased by almost 18%.

Although the largest share of NGL production in the U.S. continued to be a raw NGL mix stream (more than 57% of all production), ethane, propane, and isobutane made up almost 25% of overall production.

WORLD ACTIVITY

For the first time this year, Oil & Gas Journal's exclusive survey of the world's gas-processing activity includes figures from the republics of the former Soviet Union (under Commonwealth of Independent State--C.I.S.) in the plant-by-plant tables, p. 94).

Because of continuing difficulties in data gathering, however, 1992 figures for plants and regions are available only in aggregate, with Kazakhstan being an exception.

These data have been grouped with data from Hungary and other Eastern European areas to comprise a new section in OGJ's yearly round-up (Table 1).

Year-to-year comparisons for non-U.S. activity can be made by excluding former Communist Bloc data.

  • Worldwide capacity outside the U.S. (and the C.I.S., Eastern Europe, and China) increased more than 3.6 bcfd (4%) in 1992 over 1991.

    Increases were reported in Indonesia, the United Kingdom, Egypt, and Canada's British Columbia province.

    Canadian companies for 1992 reported a total of 545 plants operating, 10 fewer than for 1991 (Fig. 2).

    Capacity was up for Indonesia and the U.K. The latter's increase was due almost entirely to the commissioning of first phase construction on Mobil North Sea Ltd.'s St. Fergus plant, discussed presently.

  • Natural-gas throughput outside the U.S. showed more than a 2.8 bcfd gain in 1992 over comparable activity in 1991, according to the survey.

  • Production gains last year amounted to more than 10 million gpd (247,833 b/d; 12.6%) with increases coming in Latin America and Mexico, Egypt, Indonesia, and the Canadian province of British Columbia.

Canadian processing continued to represent that largest share of capacity outside the U.S.: more than 29% when C.I.S., Eastern Europe, and China figures are excluded. It held 33% of the non-U.S. world's throughput and 24% of its production.

Countries of Western Europe held 21% of non-U.S. worldwide capacity in 1992; 8.4% of its throughput; and 5% of the production.

The countries of the Asia-Pacific region: 15% of non-U.S. capacity; 17.5% of throughput; and 12.2% of production.

NEW CAPACITY

By far one of the major gas-processing stories of 1992 -less for the capacity brought on stream than for the technology of handling particularly ugly gas--was the completion at yearend 1992 and the start-up in early 1993 of Shell Canada's Caroline project in Alberta.

Processing began in March at the plant which will handle 300 MMcfd from the Caroline Devonian gas-condensate field (OGJ, Mar. 15, p. 36; June 22, 1992, p. 23).

The plant has drawn industry attention because of the high H,S content in the gas: early flows have contained up to 35% H2S.

Production from the plant will run to 18,000 b/d of condensate, 26,400 b/d of NGLS, 4,000 metric tons of sulfur, and 100 MMcfd of residue gas.

The Caroline field represented Alberta's largest gas discovery in 20 years when it was discovered in 1986. Plant construction began in late 1990.

NORTH SEA AREA

In Western Europe in late 1992, Mobil North Sea Ltd. commissioned the first phase of its new gas terminal and processing plant at St. Fergus, Scotland, to handle gas from the Scottish Area Gas Evacuation system (OGJ, Mar. 8, p. 37).

The plant is the fourth at the huge terminalling and processing center which feeds gas and liquids into the U.K. infrastructure.

Mobil's new 575-MMcfd plant is currently being expanded towards its ultimate 1.15 bcfd capacity set for completion in 1994.

NGL production from the new plant is being blended into a stream flowing from another gas plant at St. Fergus, this one owned and operated by Shell (U.K.) Exploration & Production (Shell Expro). The stream flows through a 138-mile, 20-in. line to Shell Expro's Fife NGL plant at Mossmorran.

Also at St. Fergus, Total Oil Marine plc operates a terminal and gas plant--the original St. Fergus plant, built in 1977. Construction at Total's plant last year added an additional turboexpander plant as well as separate facilities for sour (22.5% CO2; 120 ppm H2S) Miller field gas.

To accommodate Miller gas, Total installed an inlet slug catcher, gas heater, and pressure-reduction and metering facility outside its existing plant.

At Shell Expro's Fife NGL plant, a third fractionation train started up in November 1992 that doubled the plant's inlet capacity to handle liquids from the St. Fergus complex.

To handle gas from Amoco (U.K.) Exploration Co.'s Central Graben area development, Enron Corp. subsidiary Teesside Gas Processing Ltd. started up in May a gas plant at nearby Seal Sands. Initial capacity is 300 MMcfd with expansion expected by 1996 to handle an additional 300 MMcfd (OGJ, June 7, p. 39).

The plant will produce approximately 7,500 b/d Of C3 + liquids.

Gas arrives ashore at Teesside through Amoco's 255-mile, 36-in. Central Area Transmission System installed in 1991 and 1992.

Hamilton Oil Co. Ltd., London, is building a 240 MMcfd sour-gas plant a Point of Ayr, North Wales, to treat gas from Hamilton and Douglas fields in Irish Sea Block 110/13. Residue gas will drive a 1.35 mw electrical power generation plant to be built at nearby Connah's Quay. Gas is due in 1996.

U.S. ACTIVITY

In the U.S. Williams Field Services, Tulsa, started up its 480-MMcfd Milagro plant in northwestern New Mexico (OGJ, Mar. 15, p. 57).

First-train construction was completed there in October 1992 (OGJ, Mar. 15, p. 57) with additional capacity (to 575 MMcfd) to be installed by April. The plant processes coalseam gas from the Manzanares gas-gathering system.

Mesa Inc., Dallas, is building a 250 MMcfd plant in Grant County, Kan., for gas processing, helium recovery, and nitrogen rejection. The $43 million job by ABB Randall Corp., Houston, is scheduled for completion this summer.

Elsewhere, Mesa completed expanding it Fain gas plant in West Panhandle field, Texas. The project increased production as capacity to 10,800 b/d from 7,500 b/d. Gas-inlet capacity was increased to 120 MMcfd from 40 MMcfd. Earlier this year, Mesa began extracting helium that will average 160 MMcf/year.

In March, Maxus Energy Corp., Dallas, started up its 190 MMcfd Sunray, Tex., gas plant in the Texas Panhandle (OGJ, June 28, p. 68).

The plant produces helium and a mixed NGL stream and for this year will average 175 MMcfd throughput. Relatedly, Diamond Shamrock shut down its 375 MMcfd adjacent plant that had been handling Maxus' gas.

Also in Texas, as noted earlier, Valero Natural Gas Partners L.P. started up a 200 MMcfd turboexpander gas plant near Thompsonville in South Texas. The new plant can recover as much as 10 000 b/d of ethane and NGL mix. The project included an expansion of fractionation facilities at Valero Energy Corp.'s Shoup, Tex., plant and construction of a 48-mile products pipeline from Thompsonville to Valero's Shilling, Tex., plant.

The additional production capacity, combined with a 100-MMcfd expansion in 1992 at the partnership's Freer gas plant, increases the partnership's production capacity to 80,000 b/d.

In December, Colorado Interstate Gas Co. (CIG), Colorado Springs, started up its 180-MMcfd Natural Buttes BTU-control plant near Vernal, Utah. The plant is fed gas from fields in the Natural Buttes and Chipita Wells areas and is connected to CIG's new 20-in. Uinta basin lateral and to another gas line operated by Questar Pipeline Co., Salt Lake City. Its liquids production departs by truck.

The plant was installed in conjunction with a 21,000-hp compressor station.

ELSEWHERE

Outside the U.S. and Canada, Abu Dhabi National Oil Co. (Adnoc) plans to build a gas-processing plant adjacent a two-train processing plant at Habshan, U.A.E. The plant is part of several related activities for the site including gas injection, treating, condensate removal, and sulfur recovery (OGJ, Apr. 5, p. 25).

Technical details have vet to be released from the partnership of Bechtel Corp., Houston, and Technip unit of Gaz de France, Paris, which is to execute the $1.3 billion turnkey contract. Completion is targeted by the end of 1995.

In Latin America earlier this year, Petroleos Brasileiro S.A. started up the first gas-processing plant in the Amazon region of Brazil.

The plant is designed to process 23.5 MMcfd of solution gas using a mechanical refrigeration process to cool the gas to -29 C. and recover 1,250 b/d of a C3-C4 mix along with 75 b/d of stabilized condensate (OGJ, Mar. 1, p. 25).

Propak Systems Ltd., Airdrie, Alta., installed the modularized plant to handle liquids associated with gas production from the Rio Urucu oil and gas field. Among other details, the $8.8 million contract included engineering and fabrication of 16 skid modules and supply of two aerial coolers and six 7,140 bbl LPG storage tanks.

SULFUR RECOVERY

Canada and the U.S. continued as world leaders in petroleum-derived sulfur recovery in 1992, holding more than 56% of the world's processing capacity and production.

Canada reported more than 29,000 metric tons/day (mt/d) of capacity, 28% of the world's total. The U.S. held almost 30,000 mt/d, almost 29% of the world's total.

Total worldwide sulfur-recovery capacity in 1992 rose to almost 104,000 mt/d from almost 100,000 mt/d for 1991. Worldwide capacity outside the U.S. and Canada also rose, to almost 45,000 mt/d from slightly more than 40,000 mt/d for 1991.

Worldwide production of petroleum-derived sulfur increased last Year to more than 54,000 mt/d.

Canada accounted for more than 17,500 mt/d, or 32.6%, of the overall total; the U.S., almost 12,750 mt/d, or more than 23%.

Copyright 1993 Oil & Gas Journal. All Rights Reserved.