Increasing industrial natural gas use

Since 2009, industrial natural gas consumption has steadily increased as relatively low natural gas prices have supported the use of natural gas as a feedstock for the production of bulk chemicals. Industrial facilities, including methanol plants and ammonia or urea based fertiliser plants, used an average of 21.0 billion ft3/d of natural gas last year, a 24% rise from 2009. Several new industrial facilities began service this year, with additional projects scheduled to come online through to 2018.

The recent Short Term Energy Outlook from the EIA forecasts that new projects will help drive growth in industrial natural gas demand through to the end of 2016. By the end of this year, industrial natural gas consumption is expected to hit an annual average of 21.7 billion ft3/d. Industrial natural gas consumption is expected to rise by another 3.9% in 2016, to average 22.5 billion ft3/d. Next year, three methanol plants are expected to come online in the Gulf of Mexico area, with a combined capacity of almost 0.4 billion ft3/d. In addition, a large nitrogen fertiliser plant, estimated to us 0.1 billion ft3/d of natural gas is currently under construction on the Louisiana Gulf Coast and is expected to be online in 2016.

The majority of planned methanol plants are on the Gulf Coast, but Northwest Innovation Works is planning two methanol plants for 2018 on the Columbia River, Washington and Oregon. The company has plans to export methanol produced in the US to a plant in Dalain, China, where it would be converted to olefins and used in manufacturing.

Ammonia, or urea based fertiliser plants are also being planned outside of the Gulf Coast in agricultural areas by developers hoping to take advantage of higher domestic natural gas production. Later this year, a large fertiliser/urea plant in Wever, Iowa is due to come online, and two fertiliser plants are planned for towns under 75 miles away in Indiana. Ohio Valley Resources has plans for a fertiliser plant in Rockport for 2017 and Fatima Resources has plans for a plant in Mount Vernon in 2018. Each plant will use close to 0.1 billion ft3/d of natural gas, supporting continued growth in industrial demand.

Developers are also reportedly hoping to take advantage of natural gas produced in North Dakota’s Bakken Shale. Two North Dakota ammonia based fertiliser plants are proposed for 2018 and both are in the permitting stage; farm owned cooperative CHS Inc.’s proposed plant in Spiritwood and Northern Plains Nitrogen’s proposed facility plant in Grand Forks. Each plant would use 0.1 billion ft3/d of natural gas.

Edited from press release by Claira Lloyd

Read the article online at: https://www.hydrocarbonengineering.com/gas-processing/29072015/industrial-natural-gas/