Introduction to Fische-Tropsch Fuels
Fischer-Tropsch (F-T) fuels are liquid-phase synthetic fuels typically in the diesel range made from a feedstock known as synthesis gas. Synthesis gas, or syn gas as it is sometimes called, is a gas stream consisting of primarily carbon monoxide and hydrogen. Syn gas can easily be produced by gasifying coal or biomass, or by reforming natural gas. The F-T process was invented during the 1920s in Germany by Franz Fischer and Hans Tropsch. It was used by Germany during World War II to convert locally available coal into a liquid fuel. Today the F-T process is an established technology that has been utilized commercially in South Africa for many years to produce liquid fuels and feedstock for a wide variety of petrochemical products. In the last several years, as petroleum prices have risen and support for energy independence has grown, the F-T process has received renewed interest worldwide. Alaska, with its massive coal, natural gas, and biomass resources has taken part in this resurgence. However, the high capital costs of building plants and the energy lost in the conversion process are fundamental barriers to widespread use of the technology.
Fischer-Tropsch Fuels in Alaska
There are several, recently completed studies analyzing the opportunities for coal-to-liquids (CTL) or gas-to-liquids (GTL) projects in Alaska. The most recent was a study commissioned by the Fairbanks Economic Development Corporation (FEDC) after CTL technology was identified as a technology of interest by the Fairbanks Energy Task Force report dated December 2007.
This study was completed by Hatch Engineering and can be downloaded here. The report considers three different potential plants sized at either 20,000 or 40,000 bbl/d with a coal, or coal and natural gas feedstock. The report assumes a long-term supply of coal at $25/ton and a way to sequester CO2 generated in the process. Given these assumptions, projected capital costs range from 4.1 to 7.5 billion dollars (+/-40%). With an assumed interest rate of return of 12%, the breakeven F-T product price ranged from $108/bbl-$138/bbl (Hatch Report, page 2). The United States Air Force has expressed some interest in locating this plant at Eielson Air Force Base. The plant would then provide the air force with a substantial amount of synthetic jet fuel, provided the fuel meets a lifecycle greenhouse gas emission reduction target as compared to conventional fuels. One of the largest unaddressed hurdles for this project is finding a cost effective method to sequester the massive amounts of carbon dioxide produced from this project, especially since the CO2 would need to be transported either to the North Slope or to Cook Inlet for storage.
Another possible location considered for a CTL plant is the Beluga coal fields on the west side of Cook Inlet. This site has the advantage of a massive coal field that is currently a stranded resource, but close to a deep water port with export potential to the west coast of the U.S. and to overseas markets. CO2 sequestration would still be a challenge, but there are depleted natural gas wells that may prove viable for long-term storage. ANGTL, LLC has been working to advance an 80,000 bbl/d plant in this area.
Using natural gas as a feedstock for F-T fuels is also a potential option for Alaska. Converting natural gas to synthetic petroleum and transporting it down the Trans Alaska Pipeline is one way to market the natural gas on the North Slope. This option will become more attractive if a gas pipeline to the lower 48 is not built. The CO2 produced could be used on the North Slope for enhanced oil recovery, and the GTL product could keep the TAPS pipeline operational when the oil production falls. Another option would be to use both coal and natural gas as feedstock. The primary advantage here would be that natural gas produces a syn gas that is high in hydrogen, whereas coal produces a syn gas high in carbon monoxide. By adjusting syn gas amounts from each source, the CO to H2 ratio for the F-T conversion could be optimized. The Hatch study commissioned by FEDC considered a natural gas and coal feedstock scenario as one of the options, and they found it to be the economically preferable option assuming that the natural gas is available (which it currently is not, in Fairbanks).
A third possible feedstock for F-T fuels is biomass. The primary advantage of using biomass is that the process would be nearly carbon neutral over the growth cycle of the biomass. For large scale plants such as the two described above, finding enough biomass and delivering it economically to the plant would be challenging, especially given the low growth rates typical of cold climates. Given this problem, ANGTL and others have proposed smaller plants that use woody biomass or municipal solid waste as feedstock. At these smaller scales, the economics have not been proven. Most successful F-T technology licensors have shown little interest in Alaska. Nonetheless, biomass as a feedstock may have the most promise in rural Alaska, where a small plant would produce fuel locally and displace expensive diesel fuel. The operational and technological risk of such a plant would be high.
Given Alaska’s ample supply of potential F-T feedstocks, the technology could have a future in the state; however, all potential projects face significant challenges related to CO2 sequestration, high capital costs, and ability to attract demonstrated F-T technology licensors/vendors.
Links, Resources, and Documents
Fischer-Tropsch process: A link to the Wikipedia article relating to Fischer-Tropsch fuel.
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