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Hitting the Natural-Gas Jackpot

There may be enough natural gas on earth to meet our energy needs for thousands of years. The trick is to ferry it across continents without blowing up.
January 1, 2002

Compared to oil, natural gas is so abundant it’s staggering. Proven petroleum reserves are good for another one trillion barrels or so. At today’s rate of consumption, they will last about 40 years. Add in oil reserves thought to exist but still undiscovered, and the timeline stretches out some 160 years.

Known reserves of natural gas, which is composed mainly of the simple hydrocarbon methane, will last for about 50 years at today’s consumption rate. Estimates of likely but as yet undiscovered gas resources extend that projection to about 200 years. But when the natural gas thought to lie buried deep under the ocean in methane hydrates is added in, the potential is mind-boggling. Hydrates, ice crystals that trap methane molecules, form below a depth of 300 meters as a result of methane-producing bacteria. Very little is known about how much gas is bottled up in these crystals or how to get it out, but best guesses are that the reserves could, even with natural-gas consumption rates doubling over the next several decades, last tens of thousands of years.

However you do the arithmetic, there’s a lot of natural gas out there. Adding to its attractiveness as the fuel of the future is that methane is far cleaner burning than oil. But there’s a big problem: natural gas is volatile and expensive to transport. One of the beauties of oil is that you can pour it down pipes, load it onto tankers or barges and safely ship it around the world. Natural gas, by contrast, is most often shipped as a liquid, which must be maintained at a temperature of -130 C or at tens of atmospheres of pressure. It can also be transported as a gas in pipelines, but because the gas must be kept compressed, that is an expensive proposition: one estimate is that a pipeline to get gas out of Alaska and into the Lower 48 would cost around $15 to $20 billion to build.

Throw in the fact that many large reserves are in remote locations like Alaska’s North Slope or Siberia, and the result is that much of the world’s natural gas is now commercially worthless. “Of the [natural gas] that everyone agrees is there, over half has absolutely no market [value],” says Mark Agee, president of Syntroleum, a Tulsa, OK, energy firm. “None whatsoever. It’s in places like the northwest shelf of Australia, Papua New Guinea, the west coast of Africa, the North Slope of Alaska. Really remote places with no ready market close by.”

For a chemical engineer, the solution to this quandary, in theory at least, is relatively simple. If you could chemically transform this dangerous gas into a liquid hydrocarbon, like synthetic oil or even gasoline, it could be transported easily and cheaply at room temperature and normal pressure. These synthetic fuels could flow right into existing oil pipelines or be put aboard tanker ships bound for market. After further refinement, they could even be distributed through the existing network of service stations. As an added bargain, since the starting material is virtually-zero-sulfur natural gas, the resulting fuels would also be free of the sulfur and aromatic pollutants that taint other petroleum products. You would, in other words, have a readily available source of fuel that is potentially far cheaper and cleaner than oil.

Some of the world’s largest oil companies are now investing billions of dollars to build refineries that use “gas- to-liquid” technology to convert methane into ultraclean diesel and gasoline fuels. Using high-pressure, high-temperature refinery processes, these new plants, which are being constructed in places such as Bintulu, Malaysia, will turn natural gas into liquid products that are easily shipped to market and quite likely cost-competitive with petroleum products.

But some researchers believe they have a far better idea. The processes used at the new plants are based on chemistry that dates back to the early 1920s and are costly and inefficient. A small group of chemists and chemical engineers is working to discover catalysts-materials that speed up chemical reactions but are not themselves consumed in the process-for directly converting natural gas into liquid fuels at low temperatures and pressures. If these catalysts work-and that is still a giant if-they will make possible cheap, simple refinery processes that could unleash the vast untapped reserves of natural gas. Indeed, they would force experts to redo their calculations of the world’s energy supplies. Suddenly, the untapped methane resources in Siberia and northern Canada could be just as important to the world as the vast oil fields of Saudi Arabia.

Black Past

The idea of making liquid synthetic fuels is not new. In 1923, two German coal researchers, Franz Fischer and Hans Tropsch, discovered a way to turn the copious coal reserves of the Ruhr Valley into synthetic oil. Fischer and Tropsch knew that if they heated up a pile of coal, they would produce a mixture of carbon monoxide and hydrogen. The scientists found that by passing this gas over metal catalysts they could make synthetic fuel. During World War II, the German government used the Fischer-Tropsch process to produce around 600,000 barrels per year of military fuel from the country’s plentiful coal deposits.

After the war, Allied intelligence agencies tore the German plants apart to figure out how they worked, and a small Fischer-Tropsch plant was operated in Brownsville, TX, from 1948 to 1953. In the 1950s, the South African government found itself, like the Nazi regime, with little or no access to petroleum; it turned to the Fischer-Tropsch process and built several plants to convert coal from the country’s extensive deposits into synthetic fuels.

And there the technology might have stayed, confined for the most part to nations starving for oil, except for today’s growing temptation to tap into the vast reserves of remote, cheap natural gas. Methane, like coal, can be used to produce a mixture of carbon monoxide and hydrogen; except for the starting material, the fuel synthesis process works exactly the same as with coal. Exxon Mobil, Shell and South Africa’s Sasol are all involved in big projects to convert natural gas into liquid. All told, the major oil companies plan to spend nearly $10 billion on gas-to-liquid capacity in future plants.

One of the smaller, more aggressive players is Tulsa’s Syntroleum. Like the big oil concerns, Syntroleum is banking on Fischer-Tropsch conversion to turn stranded natural gas into easily transported ultraclean liquid hydrocarbons. Thanks to improved catalysts and reactor design, the company says, liquid hydrocarbons made from methane are now extremely competitive with oil in the marketplace. “The synthetic fuels we can make are 100 percent compatible with conventional products,” says Syntroleum president Mark Agee. “With natural gas, the feedstock cost [in oil-equivalent barrels] is anywhere from zero to $10 a barrel, compared with petroleum at $20. We’ve had gas offered to us on the west coast of Africa at a nickel per thousand cubic feet, or 50 cents a barrel.”

Perfect Catalyst

But the Fischer-Tropsch process is inherently inefficient and expensive-and from a chemist’s viewpoint, inherently clumsy. The process requires temperatures of around 800 to 900 oC, and those are achieved by burning part of the gas that’s being converted. The technology is also relatively nonselective, producing a large range of hydrocarbon molecules, some of which are useless. “Fundamentally, what’s wrong is that it’s 1940s technology,” says Roy Periana, a chemist at the University of Southern California. “It uses brute force and high temperatures to achieve the conversions.”

Give any organic chemist a pencil and pad of paper, and he or she could quickly draw out a simple, more elegant route to liquid hydrocarbons. Natural gas is largely methane; transforming it into methanol, an easily transportable liquid, is simply a matter of adding an oxygen atom to the methane molecule. There are, however, a couple of big problems in turning this direct-synthesis theory into chemical reality. The catalyst needs to break the tight carbon-hydrogen bonds in methane to allow the oxygen to react. And-here is where it gets really tricky-the reaction needs to add a single oxygen atom to each methane molecule; allow it to continue and add an additional oxygen atom, and you create worthless carbon dioxide.

The trick can be pulled off in the lab, but existing catalysts are not efficient enough to produce the yields required to compete with oil. Periana, for one, has been chasing the perfect catalyst for more than a decade. In the mid-1990s, Periana worked at a small California company called Catalytica, where he led a team working on new catalysts for this direct conversion. “At Catalytica, we discovered two systems,” he says. “One was a mercury catalyst that gave 40 percent yield in one step at 180 degrees. The other was a platinum system that gave 70 percent yield at 220 degrees. At that point, people began to say that maybe this was really possible.” But these promising starts ran smack up against some immutable facts of basic chemistry. While the direct conversion of methane was impressive from a chemistry point of view, it still wasn’t commercially viable. “If you’re going to replace a commodity process like this,” says Periana, “you really have to have a revolutionary process. Marginal improvements are not going to do it.”

Despite the chemistry roadblocks, Periana remains optimistic. “We have some leads, and we’re coupling that with knowledge of how previous systems have worked. And right now, it’s fair to say that this is a race. The fundamentals are laid down, and it’s a matter of who will get there first,” he says. “The question on everyone’s mind now is who will find the right catalyst and when, and what will it be. It’s not even a question of if.’”

Nature’s Puzzle

Even major oil companies investing in converting methane into liquid fuels through indirect approaches are funding research on direct conversion. Last year, BP awarded $1 million per year for 10 years each to the University of California, Berkeley, and Caltech for methane conversion research-with part of the grant earmarked for direct conversion. The catalyst search, says Alex Bell, a chemical engineer at Berkeley, “is a combination of art and science. I cannot sit down right now and say there is an algorithm for finding a catalyst for a given reaction. You build off past knowledge of what works and try to improve it with a knowledge of fundamental chemistry. Much of it is trying to establish patterns, and strategic thinking about the chemical principles that take methane to targeted products.”

And no one expects a breakthrough tomorrow. Enrique Iglesia, another Berkeley chemical engineer involved in the BP program, has been working on methane conversion for almost 20 years. “Direct methane conversion is something we dream about, but nature gets in the way,” he says. “Methane has one of the strongest bonds we know, and its reaction products usually have weaker bonds. It’s tough to stop at the desired products, so this is tough chemistry.”

Few might suspect the solution to the world’s energy problems will come out of the esoteric field of catalysis science. But with the vast, untapped reserves of natural gas out there fueling the imaginations of chemists, the search for the perfect catalyst is continuing. Tough chemistry, but if it succeeds, it will change the world’s energy calculations.

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