|~|inaugauration200.jpg|~||~|Qatar moved closer to dominating the world supply of natural gas and its refined products last month, when it inaugurated the world’s largest gas to liquids (GTL) plant.
Qatar’s emir Sheikh Hamad Al Thani inaugurated the US $950 million, first-of-its-kind, Oryx GTL plant that converts natural gas into a fuel similar to diesel, in Ras Laffan Industrial City.
“The Oryx GTL project has established the foundation Qatar needs to realise its ambitions of becoming the world’s GTL capital. Qatar is fortunate to have access to one of the world’s largest known non-associated natural gas fields, the North Field, which provides an important platform for pursuing new economic growth and diversification opportunities,” Qatar’s second deputy premier and minister of energy and industry Abdullah Al Attiyah said.
Oryx GTL is a joint venture between state-owned Qatar Petroleum (QP) (51%) and South African-based petrochemical company, Sasol Ltd (49%). Foster Wheeler is the engineering partner for Sasol’s GTL projects.
Pat Davies, chief executive, Sasol, said, “Oryx GTL is a defining moment in the growth in a whole new industry. GTL will grow here in Qatar and, as a result of this ground-breaking venture, also in many other parts of the world.
Sasol is proud to have worked with Qatar Petroleum, Chevron and partners like Foster Wheeler in developing this exciting new industry. We are at the threshold of providing the world with an attractive alternative to crude-derived transportation fuels.”
GTL is Qatar’s answer to the tantalising blessing and conundrum that Qatar’s geographical location gives it: a country with the worlds’ biggest gas reserve, but a long way from major markets and pipeline networks.
Its immediate solution has been cooling natural gas to liquefy it, shipping it in special tankers and regasifying it at its destination. However, this has resulted in a product that is awkward and expensive to store, energy intensive processes, costly transport and the need for special port terminals for a hydrocarbon that can only be used mainly to fuel power plants.
The GTL process, in contrast, produces a refined product that can be shipped in normal tankers and unloaded at ordinary ports and cars can run on. It is a cleaner fossil fuel than most others on the market.
“We congratulate Qatar Petroleum and Sasol for their vision in developing this innovative route for the conversion of Qatar’s vast natural gas resources into ultra-low emission diesel and other environmentally benign energy products,” said Steve Davies, chairman and chief executive officer of Foster Wheeler Energy Limited.
Foster Wheeler’s involvement started with an initial conceptual analysis and development of the GTL process for Sasol in 1998. This work developed into feasibility and front-end engineering design work for the Oryx GTL facility, and completion of the engineering, procurement and construction (EPC) bid evaluation in 2002.
Most oil companies have assumed that the cost of the GTL process, which ravenously consumes energy, would make GTL less profitable than LNG. Foster Wheeler, Sasol and QP, however, disagree, and QP is so convinced of its potential that it invested half the $950 million instead of using the usual production sharing agreement that would have required Sasol to put up all the money. QP and Sasol Synfuels International funded most of their project investments in Oryx through debt financing. The partners jointly appointed 15 leading banks as lead arrangers to provide the debt financing required for Oryx. QP has also agreed to expand the new plant’s output from 34,000 barrels per day (bpd) (24,000 bpd of diesel, 9,000 bpd of naphtha and 1,000 bpd of liquefied petroleum gas) to 100,000.
Sasol’s Pat Davies noted that Oryx GTL will dramatically shift perceptions of risk associated with GTL technology to one of rewards. It will encourage more countries and industries to invest in GTL he said. Chris Turner, general manager of Oryx GTL, said that the Oryx GTL will make more of the world’s energy leaders to take more seriously about the merits making money out of some of the world’s big gas reserves via GTL.
And with India and China competing for joining the competition the energy world is looking at the Oryx GTL with interest. It uses the proprietary, low-temperature Sasol Slurry Phase Distillate process that is based on Fischer-Tropsch technology. The feedstock is 330 million cubic feet per day of lean natural gas from Qatar’s North Gas Field.
Sasol is planning another GTL plant in Nigeria with Chevron Texaco and considering others in Iran and Australia, and is also keen to promote even trickier and more expensive coal to liquids (CTL).
So, Sasol’s success in Qatar may change the face of the global energy industry in more ways that one. If it all works as planned, attracting finance will become much easier for the proposed projects queuing up to follow in Oryx’s footprints.||**||
Follow us on
