gas monetization via methanol & gas-to-gasoline (g2g™) … · 2016-11-10 · • investment...

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Gas Monetization via Methanol & Gas-to-Gasoline (G2G™) TechnologiesSiva Ariyapadi, Air Liquide Global E&C Solutions

2016 GSTC Conference, Vancouver, Canada


Methanol Market Drivers

Leadership in Methanol – Lurgi MegaMethanol™

Recent Projects & Synergies with Industrial Gas Supply

Gas-to-Gasoline (G2G™) Technology Approach

G2G™ Plant Economics & Integration Benefits

Technology Integration & Benefits

Outline


Feedstock Opportunities for Methanol & G2G™

Advantaged Feedstock


Industry Modernization

Coal based development

Environmentprotection


Coal based development

Demand for Distillates and

Oxygenates

Future Gas Development

Future Gas Development

Niche opportunities for Coal development


Options for gas monetization

• Lower CAPEX• Limited to regional demand / transmission constraints• Upside for product value generally limited

• Suitable to monetize larger volumes of gas• Extensive gas treatment, high capital intensity• Logistics / plant location key for development

• Moderate capital intensity, shorter project development• Single product produced, e.g. Methanol or Gasoline• Logistics / off-take requirement (regional and global)

• High value products• High capital intensity, development time / schedule• Management of multiple co-products

Power

LNG

GTL

Methanol and Derivates


• Capital recovery is based on a simple 5-yr payback (no debt financing considered)

• Methanol Sales price at plant gate ~ $300 to $400/t

• Investment cost based on a 5,000 metric tons per day (mtpd) Methanol Plant in the US Gulf Coast

Methanol: Robust Economics ~ Advantaged NG

$0

$100

$200

$300

$400

$500

$2.0 $3.0 $4.0

Per MT of Methanol

NG Price, USD per MMBTU - HHV

Margin

Capital Recovery

O&M

OpEx

Natural Gas

Price volatility

Methanol price historically correlates with crude, impacts margins


55+ Plants licensed since 1969 (40 mtpy)

• Multiple new MegaMethanol™ units in the last 18 months

• 17 Oxygen reforming plants (20 mtpy)

• 14 MegaMethanol plants (24 mtpy)

• 21 Plants licensed since 2001 (29 mtpy)

63%

31%

6%Natural Gas(33 plants)

Coal(11 plants)

Others(11 plants)

Based on installed capacity

Air Liquide Lurgi Methanol Technology


Lurgi MegaMethanol™- low overall lifecycle cost

Combined

Reforming

Large syngascapacities

enabled through oxygen

technology

Two-stage synthesis

reactor system

Small syngas / recycle

compressors

Low natural gas consumption

Minimized investment cost

Lurgi Reformer™ (SMR)

Autothermal Reformer (ATR)


2001 2002 2004 2005 2014 2015

Zagros 1, South Caspian

■ 1.75 mil tpa

■ NG based

Atlas MeOH, Trinidad

■ 1.75 mil tpa

■ NG based

Methanex, Chile

■ 800 ktpa

■ NG based

Zagros 2, South Caspian

■ 1.75 mil tpa

■ NG based

Petronas, Malaysia

■ 1.75 mil tpa

■ NG based

Methanol Severny,

Russia

■ 1.75 mil tpa

■ NG based

KML, Kazakhstan

■ 825 ktpa

■ NG based

OCI, TX, USA

■ 1.75 mil tpa

■ EP Package

Zeogas, TX, USA

■ 1.75 mil tpa

■ Integration into

Gasoline

YCI, LA, USA

■ 1.75 mil tpa

■ EP Package

BASF, TX, USA

■ 1.75 mil tpa

■ Integration into

Propylene

- Additional 5+ MegaMethanol plants in China (coal based- 2006-2013)

Recent Methanol Plant References


Large Industries - Synergies & Global Network

Large volumes of industrial gases and energy solutions

Large on-site plants and pipeline networks

Long-term contracts with customers


Northern Europe NetworksFrance - Belgium - Netherlands

USAGulf Coast

Mississippi River

CanadaHamilton

FranceNormandy

Feyzin

Fos-Lavéra

Richemond

ItalyGenova - Padova

Thailand Map-Tha-

Phut

Singapore

IndonesiaMerak

ChinaCaojing

KoreaYochon

GermanyRuhr

Kuwait

Qatar

Oman

BrazilPaulinia

ArgentinaBahia Blanca

Ensenada

San Nicolàs

Americas ≈ 3 000 kmAsia ≈ 250 km

Benelux ≈ 2 300 km

France ≈ 1 600 km

Italy ≈ 600 km

Germany ≈ 470 km

Spain ≈ 30 km

Large Industries Pipeline Network > 8500 km


Recent Examples - Methanol + ASU OTF

Optimized solutions

Methanol & ASU

OCI

YCI

Over the Fence

Optimized solutions

MegaMethanol™ licensed

technology

Oxygen OTF contracts

New Air Separation Units linked

to existing pipeline infrastructure

Gas-to-Gasoline (G2G™) Technology



Gas-to-Gasoline Technology Approach

Referenced technologies - Costs and performance well understood

Two proven technologies, one competitive solution

13

Natural

gasMethanol

Gasoline

LPG

51 plants built

9 plants of the same size

and technology in operation

2 plants operated:

• New Zealand 14,500 bbl/d (1985-97)

• JAMG China 2,500 bbl/d (2009)

2nd JAMG plant (2 x12,500 bbl/d) under

construction

Feedstock options for G2G™


Technology Summary, Methanol & MTG

Natural Gas

Lurgi

Syngas

Plant

Air Liquide Technologies

ExxonMobil Technologies

Lurgi

Methanol

Plant

MTG

Plant

ASU

Off sites and Utilities (common)

151.9 MMSCFD

5,000 mtpd

Methanol

16,100 bpd

Gasoline

1,009.5 BTU/SCF (HHV)

LPG

(internally

consumed)


Energy Scenario – Typical for Feedstock (NG)

advantaged regions

Natural Gas (NG) vs. Oil Products spread maintained despite lower oil price


A Case for two (Feedstock Advantaged) regions

Gasoline surplus continues to rise

through 2025, while demand

declines. However, pockets of

regional deficits exist

The US Gulf Coast has been the

growth engine for the recent boom

in distillate exports to Latin America

and other regions

8.8million b/d

demand

134refineries

Source: Wood Mackenzie

Gasoline surplus continues to rise through

2025, while demand declines by 0.5%

annually. Regional deficits + strong

demand from neighboring regions

Russian gasoline key to meet the needs of

the region and potential Asian markets

0.8million b/d

demand

75refineries

G2G™ presents a simpler option to transform gas in areas with gasoline demand


G2G™ Financial Model - Level 1 Analysis

G2G™ Plant1,2,3

Natural Gas

Common Offsite

& Utilities

Power0 MW

Gasoline

1) Based on 5,000 mtpd methanol equivalent facility

2) All offsite and utilities included

3) No power import expected during normal operation

• USGC based set-up

Raw Water~3,000 GPM

151.9 MMSCFD

1,009.5 BTU/SCF (HHV)

LPG by-product consumed in

the process

16,100 bpd


Level 1 G2G™ Economics – Base Case

• Variable costs include consumables such as catalysts and raw water

• Fixed costs include estimated fixed labor and annual maintenance

• CAPEX excludes items such as owners costs and contingencies, product storage costs, taxes & insurance

0.09

0.68

0.07

0.34

$1.19

0.00

0.50

1.00

1.50

2.00

2.50

3.00

1

$/g

all

on

ga

so

lin

e

Depreciation

Variable Cost

Feedstock (NG)

Fixed Cost

Gasoline : $2.67/gal

(Crude*: $100/bbl )


(Crude *: $80/bbl )


(Crude*: $60/bbl )Mar

gin

Pro

du

ctio

nC

ost

+

Dep

reci

atio

n

Break-even at $38/bbl Crude*

CAPEX: Base (US Gulf Coast)

NG : $3/ MMBTU (HHV)

Wholesale Gasoline*: Crude + $12/bbl

Scope: ISBL + OSBL units


Level 1 G2G™ Economics – Capex Sensitivity

•Variable costs include consumables such as catalysts and raw water

•Fixed costs include estimated fixed labor and annual maintenance

•CAPEX excludes items such as owners costs and contingencies, product storage costs, taxes & insurance

$0.09

$0.68

$0.07

$0.43

$1.28

0.00

0.50

1.00

1.50

2.00

2.50

3.00

1

$/g

all

on

ga

so

lin

e

Depreciation

Variable Cost

Feedstock (NG)

Fixed Cost


(Crude*: $100/bbl )


(Crude*: $80/bbl )


(Crude*: $60/bbl )Mar

gin

Pro

du

ctio

nC

ost

+

Dep

reci

atio

nM

arg

inP

rod

uct

ion

Co

st +

Dep

reci

atio

n

CAPEX: Base X 1.25 (USGC)

NG : $3/ MMBTU (HHV)

Wholesale Gasoline*: Crude + $12/bbl

Scope: ISBL + OSBL units

Break-even at $42/bbl Crude*


Natural Gas & Capex Sensitivity

0.620.73

1.07

1.41

1.64

0.00

0.50

1.00

1.50

2.00

0.5 1 2.5 4 5

Pro

du

ctio

n C

ost

+ D

epre

ciat

ion

($/g

al)

Natural Gas Cost ($/MMBTU)

Base Case

0.710.82

1.16

1.501.73

0.00

0.50

1.00

1.50

2.00

0.5 1 2.5 4 5

Pro

du

ctio

n C

ost

+ D

epre

ciat

ion

($/g

al)

Natural Gas Cost ($/MMBTU)

Base Case x 1.25


Customer/ EPC exposed to single licensor interface

Seamless process design- Closed material balance at an early design stage

Simplified and single-point guarantee concept

Technology integration - upsides to cost, performance

Bankable technologies provided by a world-leading engineering & technology and industrial gas company

G2G™ Integration & Customer benefits

Lurgi

MegaMethanol™

ExxonMobil

MTG

Natural Gas

Coal

Heavy HCs

Gasoline


Using Technologies to create value

Natural Gas,

Coal

ASU,

Reforming

Gasoline

Methanol

MTG

gas monetization via methanol & gas-to-gasoline (g2g™) … · 2016-11-10 · • investment...

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