Smaller scale GTL

Velocys have said that the decision by Shell not to pursue its 140 000 bpd Gulf Coast GTL project due to cost considerations illustrates the problems of planning a mega scale project.

The very long lead times in constructing a project such as the above meant that it was unlikely to come onstream until well into the 2020s. The usual development time for such a project is five years from final investment decision. Shell has commented that with three mega projects planned in North America, it would be almost impossible for enough engineers to be found and projects managers to be contracted to run all three projects simultaneously.

Smaller scale GTL

When compared to large scale projects, small scale GTL projects;

• Require less capital. A small GTL project costs approximately US$ 250 million.
• Are quicker to build. Smaller scale plants can be creating high value products within as little as two years.
• Can be deployed on smaller fields, at a greater range of locations and by a wider range of contractors.
• Involve less risk. There is a smaller change of cost overruns and delays and permits are also easier to secure.
• Can seize the best situations. They can be constructed at remote locations or integrated with existing facilities.

Comments

Roy Lipski, CEO, Velocys said, ‘Shell’s recent decision not to pursue a GTL plant in Louisiana illustrates the complexity of planning mega scale conventional GTL project. In contrast, the economics and flexibility of smaller scale GTL are much better suited to the current realities than conventional GTL projects with their huge demands on capex and other resources. Indeed, market momentum for smaller scale GTL has never been stronger, which is only reinforced by this recent announcement.’

Edited from various sources by Claira Lloyd

Read the article online at: https://www.hydrocarbonengineering.com/gas-processing/09122013/smaller_scale_gtl_897/