Gas to Gasoline at $1/gallon? (Call it 25 cents / liter…)

Another of those “links from somewhere” where I’ve lost track of who / what pointed me to it… Again, if it was you, speak up.

There is a small start up in the San Francisco Bay Area that is working on new and interesting catalysts. (Were I to bet on what new tech matters most, it would be novel ways to do chemical and energy catalysis…)

They claim to have found a couple of catalysts that, used one after the other, give you gasoline from natural gas at about $1 / gallon. That is actually possible.

Natural Gas is presently selling for about $3.74 / MMBTU (that’s 1000 x 1000 BTU or one Million BTU).
http://www.bloomberg.com/energy/

Gasoline has about 111 to 114 thousand BTU / gallon.
https://en.wikipedia.org/wiki/Gasoline_gallon_equivalent

So it’s about 9 Gallons of Gasoline Equivalent (GGE) per MMBTU of natural gas. That makes that gas about 41 ¢ per GGE. At that rate, you can have a 2.5 to 1 conversion loss and still end up at $1.02 / gallon.

Now, prior to fracking, CNG spiked up to about $12 / MMBTU (or about $1.33 / GGE) and at that point it would be about $3.36 / gallon after the conversion. So as soon as this is widely used, expect abnormally low natural gas prices to rise back to an arbitrage equilibrium price.

So my ‘net net’ on this would just be that while it is a way cool tech, and can make gasoline really cheap at present prices (and ought to be done), it isn’t a panacea. Eventually prices will approximate with each other. Still, that would involve some drop in gasoline prices and a large rise in natural gas prices. For some gas, like stranded gas in Alaska where a pipeline can be way too expensive to build: conversion to gasoline or Diesel and local trucking / sales would be a marvelous thing to do.

From the original news link:

Siluria turns natural gas into gasoline for $1 per gallon
Siluria partners with oil industry giants to make fuels cheaply
David R. Baker Updated 8:55 am, Thursday, August 21, 2014

The clear liquid flowing from a collection of pipes and wires in a Hayward industrial park smells just like gasoline, and for all practical purposes, it is.
But it wasn’t made from crude oil. Instead, it came from natural gas, the fuel whose sudden abundance in America is reshaping the country’s energy landscape.
Siluria Technologies says it can produce large quantities of gasoline, diesel, jet fuel and chemicals at a lower cost than traditional refineries and chemical plants. At today’s natural gas prices, Siluria’s technology could make gasoline at roughly $1 per gallon, according to the company.
The oil industry has taken notice. Siluria reported Wednesday that its latest, $30 million fundraising round was led by Saudi Aramco, the world’s largest oil company.
[…]
Aramco will join Siluria’s board of directors and has put together a team studying ways to deploy the technology in Saudi Arabia. Founded in 2008, Siluria has now raised $96 million from such investors as Bright Capital, Kleiner Perkins Caufield & Byers and Lux Capital.

I find the Aramco participation a bit of a worry. They poo-poo such concerns and assert it’s all going to be just fine… but ARAMCO will always be more interested in Arabian interests than the interests of US Drivers.

Still, a technology once it exists can always be used by a country in an emergency without the consent of the inventors. Though I doubt our gutless congress would ever think of doing such a thing…

A visit to their web site: http://siluria.com/Technology/Oxidative_Coupling_of_Methane gives some interesting technical details:

Oxidative Coupling of Methane
The oxidative coupling of methane has been the target of intense scientific and commercial interest for more than thirty years due to the tremendous potential of the technology to reduce costs, energy, and environmental emissions in the production of ethylene. In OCM, methane (CH4) and oxygen (O2) react over a catalyst exothermically to form ethylene (C2H4), water (H2O) and heat
[…]
Siluria combines several highly innovative technologies to create our growing family of commercially viable OCM catalysts. These technologies include: (1) the synthesis of nanowire catalysts allowing us to create vast numbers of unique, novel inorganic nanowire structures; (2) unique templating technologies; and (3) high throughput screening tools to rapidly evaluate hundreds of catalysts, unlike traditional methods that evaluate one catalyst at a time.

Siluria focused on all key process variables such as temperature, pressure, activity, and catalyst stability and lifetime, not solely conversion and selectivity. The result has been the development of OCM catalysts that operate at significantly lower temperature (several hundreds of degrees lower), practical operating pressures (5-10 atmospheres), high activities, and having standard lifetimes of years under said conditions.

They then run the ethylene through another catalyst to get fuels.
http://siluria.com/Technology/Ethylene_to_Liquids

Ethylene to Liquids
Siluria has developed a second process, known as Ethylene to Liquids (ETL), to convert unpurified ethylene from the OCM process to hydrocarbon liquid fuels.

Siluria ETL Process
In the ETL process, the OCM ethylene effluent is oligomerized over a catalyst (different than the OCM catalyst) to selectively produce targeted products, such as gasoline, condensate, aromatics, heavy oil diluents or distillates including diesel or jet fuel. Oligomerization refers to the process of producing higher carbon number molecules from ethylene or other alkenes.

All in all interesting…

But somehow I doubt Aramco will be licencing it to folks all over north America to make gasoline at $1 / gallon. But maybe someone else will make a competitive process and force their hand…

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About E.M.Smith

A technical managerial sort interested in things from Stonehenge to computer science. My present "hot buttons' are the mythology of Climate Change and ancient metrology; but things change...
This entry was posted in Energy, Tech Bits and tagged , , , . Bookmark the permalink.

10 Responses to Gas to Gasoline at $1/gallon? (Call it 25 cents / liter…)

  1. Looks excellent EM. I’ll swipe this and do a write-up on R-G. I’d suspect that the patents can be got around by using a different method of catalyst preparation, and even if not then the patent laws don’t stop people using a patented process but allow the courts to set a reasonable royalty to the patent holder (around 5% IIRC) so it would not stop production where the profits are there or there’s sufficient national need. The patent laws also allow the government to take over patents that are deemed to be of national importance.

    Where excess gas is currently flared off since the source is too far from an available pipeline the gas is effectively free or a negative cost, so the process has to be profitable there. As you say, though, Aramco may well try to keep this process marginalised. It’s against their interests.

  2. Cheyne Gordon says:

    It reminds me of cold fusion, so I’ll wait till I see it at the pumps . . .

  3. Serioso says:

    Sasol has been doing something similar for years. Main problem, as I understand it, is high capital costs. [Full disclosure: I’ve owned Sasol stock for years.]

  4. agimarc says:

    It’s a variation on FT, which the locals up here believe to be profitable down to the neighborhood of $40/bbl synthetic diesel or whatever liquid is produced. Interesting the price / gallon is in that range also. I would guess it to be a floor for the time being. Cheers –

  5. Graeme No.3 says:

    Gasoline is based on branched molecules, jet fuel and diesel straight chain molecules, so at least 2 catalysts used. Sort of low molecular weight polyethylene. Technically very feasible.
    Have they put out a final cost including additives e.g. ethanol, MTBE etc.?

  6. DonM says:

    It would be very interesting if even part of the drop in oil, even peripherally, was related to this as an assumed viable technology.

    The Saudi’s also have a very large projected gas reserve …. My guess is that Aramco controls it, and having use of this process would be more of a direct benefit (and hedge) to Aramco rather than a mechanism to control the process for indirect gain. But u never know.

  7. Robert B. Stephens says:

    EM,
    You might find this interesting. http://www.greyrock.com/. Greyrock has a small scale GTL plant that can convert NG to fuels like diesel without those pesky pipelines. I guess you are familiar with the giant GTL plant in Qatar which was recently built by Shell. Shades of German fuel production in WWII

    Bob Stephens

  8. cdquarles says:

    Back in the 70s, there was some work done using zeolites (generally the natural mineral at that time) to convert methanol or ethanol to octane. It works, for the zeolites in question were relatively rare but were better catalysts and cheaper than platinum-iridium ones that were better known.

    Chemist aside. When I was at the University, the joke among organic chemists was that there was no chemical you couldn’t make (containing carbon) if you had ethanol and a proper catalyst.

    Since then, there has been work done on fully synthetic zeolites (to control the properties and get reliable big plant throughput by theoretical chemists and enterprising chemical engineers. That’s likely where you heard of this.

    With the rise of recombinant DNA methods, I wouldn’t be surprised to see engineered protein catalysts come on-stream (that is if the Malthusians/Progressives would let the ‘prime movers’ work out the bugs).

  9. Ralph B says:

    Serioso mentions Sasol above. I am in Lake Charles, LA right now and Sasol is just starting construction of a NG to Diesel facility here. There are a couple LNG plants on the books as well (not Sasol) for exporting LNG.

  10. R. de Haan says:

    Interesting developments.

    I have been looking at EMD generator sets delivering 2.3 Mw power output as an alternative to my renewable power driven price hiking electricity supplier.

    My electricity bill is currently € 485,00 per month just shy from € 6.000,– per year and rising.

    So I was thinking about the very big Gen Sets currently on the market for $ 680.000,– which use about one gallon of fuel per HP per day = 2000 gallons per day times 365 = 730.000 gallon per year, see; http://www.powerplantsonline.com/dieselgenerator.htm Listed 11/14/2014
    2.3MW EMD Mobile Diesel Generators Sets (6 available). New/Unused. Available immediately at 50Hz. (Can be converted to 60Hz. In 45 days, 900rpm.) Each unit is packaged in a shippable housing with all controls and lubrication/cooling systems. Designed with synchronization capability to operate in parallel with each other and/or with the utility/grid. They also can be operated as stand-alone units. These units have been load tested and certified by a leading testing service company. They are complete and ready to ship immediately from SE US. Asking $600,000 each ( $680,000 if converted to 60Hz.) Contact Milt Fyre 503-351-9898 or milt@rmaglobal.com

    With 2.3 Mw output per generator there is sufficient power available to serve a neighborhood or a village of approx. 1600 households so I wondered if splitting the costs and taking the trouble to plan for a local “community initiated” electric power company running two of these monster engines could be a profitable enterprise cutting down the average electricity bill.

    Well, obviously it is if you can manage to get 1600 households to join the operation, even if the fuel prices had continued at the past high level.

    With the current fuel prices the entire idea looks more and more interesting by the day, not only here in Germany but also in locations like Panama where undeveloped construction land is very cheap, new communities pop up all over the place and no grid is available.

    Purchasing two of those generators would mean a $ 850,– one time investment per household, an annual $ 250,– fixed contribution to cover the costs of maintenance and TBO and some administration costs covering the billing and accounting.

    New technological innovations for these generator engines like valve turners and heat exchangers further could reduce maintenance costs, time between TBO and fuel costs and could be installed at the first overhaul.

    The fuel costs of 730.000 gallons per year divided by 1600 households (456 gallon per household) would still remain the big variable but at least € 4.000,– less than what I pay for my electricity today.

    And that’s a big cut in costs if you ask me and well worth the time and effort to do some research, especially if you can combine the activity with the introduction of a glass fiber broadband network.

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