Sinopec, Syntroleum sign GTL, CTL technologies deal

China Petroleum & Chemical Corp. (Sinopec) and Syntroleum Corp., Tulsa, have signed a nonbinding memorandum of understanding aimed largely at advancing natural gas-to-liquids and coal-to-liquids technologies.

Eric Watkins
Senior Correspondent

LOS ANGELES, Mar. 1 -- China Petroleum & Chemical Corp. (Sinopec) and Syntroleum Corp., Tulsa, have signed a nonbinding memorandum of understanding aimed largely at advancing natural gas-to-liquids and coal-to-liquids technologies.

The MOU aims at cooperation in verifying Syntroleum GTL technologies on an industrial scale, construction of a 17,000 b/d GTL plant and a 100 b/d CTL pilot plant in China as well as joint marketing of Sinopec Syntroleum technology there.

Syntroleum will provide Sinopec with access to its complete set of proprietary GTL technologies, including catalyst technology and Fischer-Tropsch (F-T) technologies related to CTL, for use in China on an exclusive basis during the period of cooperation.

After signing a formal cooperation agreement, Sinopec will provide Syntroleum with $20 million/year over the next 5 years to support the technology's development.

Sinopec will start feasibility studies for construction of the plants as well as the CTL pilot plant in China, upon completion of the cooperation agreement.

Both plants will be fully capitalized by Sinopec, with technological support from Syntroleum. The two projects will provide the basis for the two parties to jointly market the combined F-T technology capabilities to third parties within China.

A Sinopec spokesman said the company was investing in the technology to complement existing efforts to develop its gas reserves in the long term.

Last December, Syntroleum signed a joint development agreement with Kuwait Foreign Petroleum Exploration Co. for development of a 50,000 b/d GTL plant in Papua New Guinea (OGJ Online, Dec. 22, 2006).

Contact Eric Watkins at hippalus@yahoo.com.

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