Welcome to the Energy Blog

  • The Energy Blog is where all topics relating to The Energy Revolution are presented. Increasingly, expensive oil, coal and global warming are causing an energy revolution by requiring fossil fuels to be supplemented by alternative energy sources and by requiring changes in lifestyle. Please contact me with your comments and questions. Further Information about me can be found HERE.



After Gutenberg

Clean Break

The Oil Drum


Blog powered by Typepad

« Engineers' magnesium solution to hydrogen storage debacle | Main | Rentech May Benefit From Military Use of FT Fuels »

September 20, 2006



Lets see if this scales up as they claim in their pilot plant

(At USD $1 = £0.5258 BPS)

$1 per gallon ... ~ £0.17 per litre ...

The thing with gasification - as we're familiar with by now is large capexs (capital expenditures) to build the large facilities and the relatively low energy efficencies roughly 60% of traditional petrochemical (oil derived processes).

I'm quoting a presentation by Dr Richard Pike, Cheif Executive of the (British) Royal Society of Chemistry that I've been privalaged to sit in on...

"World-scale plants require reserves to support operation for project duration... Commercial attractiveness depends on the detail of cash-flow methodology ... Equipment costs are usually a small proportion of total costs; other costs show the demands placed on the host-country for a typical project Total project cost is approximately 4.8 times main equipment purchase cost Conversion of gas to GTL remains an energy-demanding process (cf LNG) - Typically yield of ~9 mscf/bbl Gas-to-liquids (GTL) 50-60%[chemical conversion process, typical]"

NOTE from mcr - these additional costs are usually in the middle east or other areas - away from the industrialised west where the market is.

His opinions were (for natural gas as a feed in his example) BUT bio-derived feeds here -

"GTL opportunities lie in decoupling petroleum product prices from feed costs by relying on cheap natural gas feed; this works provided product prices are high and gas prices low. Improving efficiencies and reducing non-fuel costs (including CAPEX) are also key elements "

"Economics of GTL will improve with reduced CAPEX and higher crude oil price environment (provided gas prices are low), but an important question remains on the next steps for the industry…"

He believes:
Commercial returns for small GTL plants at U.S.$1.00/Mscf require U.S$ 30/bbl oil

My own intereptation is - if the price of oil remains above $60 per barrel - then alternative (to natural gas) are feasible - but technology needs to be pushed further.... to get the overall economics better.

His own views of where the R&D efforts will focus are quiet interesting also...

I'll be keeping my eyes on this pilot plant described here

Thanks for pointing this out James!

JP Elverding - the Netherlands

I'm working on the realization of a plastics to diesel plant and hence have looked into costs and value of the produced diesel, to be operational in 2007 here in the Netherlands.

Naturally all alternatives to the usual, mostly fossil fuels have their prices and will wither with barrelprices under 60$ a barrel.
The major difference is that the environmental impact traditional fuel has when compared to this new kind of diesel. If we take the costs of pollution, healthcare and suffering in the equation, synthetic diesel is way more cheaper!

In the Netherlands fuels is heavily levvied, with a net price for dieselfuel of some 40 cents, a "pump-price" of approx. 1 euro per liter. If the levvies were mildly reduced for this cleaner kind diesel it would save many lives and make investors happy enough to invest in this and many other sources of sustainable energy.

Have a clean, wonderful day!

The comments to this entry are closed.

. .

Batteries/Hybrid Vehicles