BP makes progress at GTL plant

Posted: Monday, June 23, 2003

BP Exploration (Alaska) Inc. is gradually working the kinks out of its gas-to-liquids process being tested at the company's $86 million research plant in Nikiski.

"We could be close to getting our first barrel of synthetic crude oil," made from natural gas, "and when it happens, you'll hear us cheering all the way from Anchorage," said Len Seymour, BP's manager for the project.

BP is testing new technologies that could sharply lower costs in the "GTL" process, which could make it possible to develop commercial products with natural gas deposits found in remote areas.

The project isn't aimed at Alaska's North Slope, Seymour said, because a pipeline appears to be the best way to "commercialize" that gas. But it could be used in many other parts of the world where there is stranded gas, he said.

There are three stages in the GTL process that are all incorporated into the test plant in Nikiski. Two of the three stages involve proprietary technologies BP is testing.

The first stage, arguably the most important new technology, is a reformer unit that is smaller and more compact than reformers on existing GTL plants now in operation elsewhere.

The reformer takes natural gas and steam and converts them into a "synthesis gas," a mixture of hydrogen and carbon monoxide.

In existing GTL facilities, the reformers are the largest and most expensive parts of the plant and they account for as much as 60 percent of the cost of the plants, according to Richard Peterson, whose company, Alaska Natural Gas to Liquids Inc., is working on commercial possibilities for GTL plants.

BP's new compact reformer is smaller and, if it works, holds the promise of reducing capital costs for GTL plants.

The synthesis gas is fed through a compressor into the second stage of the GTL process, a converter which uses the Fischer Tropsch chemical process to rearrange hydrocarbons in the gas into long-chain molecules that comes out of the converter as a wax.

The third stage is a hydrocracker unit, standard technology used in refineries, which does the final conversion of the wax into a liquid product, breaking the long-chain molecules into shorter chains. The result is a synthetic crude oil, a liquid.

Commercial-scale GTL plants, such as those operating in South Africa today, go one step further, running the synthetic crude through a conventional refining process to make environmentally-friendly diesel, gasoline, jet fuel and feedstocks for petrochemicals.

The BP test plant, which will produce 300 barrels per day of synthetic crude, or "syncrude," does not have the final refining stage in the plant because that is conventional technology, according to Dave MacDowell, BP's external affairs manager for its Alaska natural gas group.

Instead the syncrude will be trucked to Tesoro Alaska Petroleum Co.'s refinery in Nikiski for blending with Tesoro's crude feedstock.

Seymour said the compact reformer in the Nikiski has been started and operated several times and each time glitches that were uncovered taught BP valuable lessons. That's what a research plant is for, Seymour said.

The reformer operated for three weeks in March and early April, its longest run yet. It operated well the last time it was up and running, until another problem caused a shutdown.

The latest glitch was mechanical, and ironically not in the reformer but in the compressor that feeds the synthesis gas to the Fischer-Tropsch reactor. A seal in the compressor failed, which required BP to shut down the reformer.

"It's frustrating that what stopped us this time was old, not new, technology," Seymour said.

What BP's engineers now think is that the seal used in the compressor was somehow incompatible with the synthesis gas, causing it to fail. The 6,800-pound compressor was taken out of the plant and air-freighted back to the vendor in California for a refit of the seals, Seymour said.

Despite these setbacks, which are unrelated to the new proprietary technology, BP is tantalizingly close to getting the reformer into sustained operation for the six months to a year it will take to fully assess operation of the new system, Seymour said.

Meanwhile, the other two parts of the plant appear to be working well. The Fischer Tropsch reactor involves a new, proprietary catalyst BP is testing, but the unit has been active for some time in the plant and should perform once the reformer is making synthesis gas.

The catalyst has been extensively tested in BP's laboratories and, in fact, is still undergoing a long-running test to study its performance, Seymour said.

If the reformer can be started and operated continuously soon, BP could conclude its testing program by early to mid-2004. After that, the plant will most likely be dismantled, Seymour said. It is so built-to-purpose for the GTL test project that there may be no economic alternative uses for the facility, he said.

BP is one of several companies working on GTL improvements. Exxon Mobil Corp. has done extensive work on its own proprietary technology and built a demonstration plant, similar in purpose to BP's test plant at Nikiski, at the Exxon Mobil refinery at Baton Rouge, La.

Sasol, the South African energy company, pioneered development of modern plants using the Fischer Tropsch process in South Africa. Sasol's early plants used coal in the process, but the company assisted Mossgas, another South African firm, in developing a commercial-scale GTL plant using natural gas.

Shell operates a GTL plant in Malaysia that sells products to petrochemical industries in Asia and sells "clean" diesel to California refineries that blend it with conventional diesel to meet tight air pollution limits.

While BP's new technologies could reduce costs, GTL is still seen as an application where gas is truly stranded with no possibility of using conventional means of development, such as pipelines.

In Qatar, on the Persian Gulf, there are huge reserves of undeveloped gas, and Exxon Mobil, Sasol and other companies are working on what may be the world's first commercial large-scale GTL plants outside of South Africa.

More conventional liquefied natural gas, or LNG, plants also are being built in Qatar.

Tim Bradner is a reporter for the Alaska Oil and Gas Reporter.

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