Small-scale GTL technology cuts production costs for drop-in fuels

George Boyajian, Vice President of Business Development,
Primus Green Energy, Hillsborough, New Jersey

Primus Green Energy is one of a small group of companies leading the technology revolution in small-scale gas processing. Its STG+ process directly converts natural gas and biomass into drop-in liquid fuels. Primus’ vice president of business development, George Boyajian, talks with Gas Processing about applications for STG+ technology and the company’s progress on a commercial-scale plant.

GP. How does Primus Green Energy’s STG+ technology cost effectively turn natural gas and biomass into transportation fuels on a small scale?

GB. Primus’ STG+ technology fundamentally improves the efficiency and economics of GTL and liquid fuel synthesis technologies. STG+ boasts very high efficiency, which means that commercial facilities are expected to cost one-third to one-tenth as much as traditional alternative fuel and GTL facilities.

An important advantage that contributes to improved process efficiency and economics is our feedstock flexibility. We can use any carbon-rich feedstock that can be turned into a high-quality syngas, including natural gas, biomass, municipal solid waste and others.

STG+ is not the only GTL process that uses syngas. Unlike competing technologies that convert syngas into liquid end products via multistage processes, Primus’ STG+ technology converts syngas directly into gasoline via a proprietary, single-loop process. To produce syngas, Primus uses a standard commercial technology called steam methane reforming (SMR) to convert natural gas into syngas, as well as other commercially available systems for the conversion of biomass into syngas, a fuel precursor composed primarily of hydrogen and carbon monoxide. Primus can reform the natural gas into syngas on its own, or buy the syngas from a supplier. The syngas is then scrubbed to remove carbon dioxide and other impurities, such as sulfur, prior to the liquid fuel synthesis process. Primus’ STG+ technology can utilize syngas from a variety of sources, as long as the syngas meets its specifications.

After the syngas is produced and scrubbed, the STG+ process uses four separate reactors to transform that gas into liquid fuels. In the first reactor, syngas is converted into methanol. The second reactor converts the methanol into dimethyl ether. The third reactor produces heavy gasoline, which has an undesirable durene content. The fourth reactor cleans the heavy gasoline by converting durenes into other compounds, with a finished transportation fuel being produced at the end. The end product depends partly on the catalysts used in the four-reactor system. Primus uses standard catalysts similar to those used in other GTL technologies.

By reducing the number of steps in its process, Primus has made its STG+ technology more efficient, less expensive to build, and more scalable than competing GTL technologies, which include methanol-to-gasoline (MTG) and Fischer-Tropsch (FT), the most common GTL process in use today. The cost effectiveness of Primus’ STG+ technology has been validated through a cross-examination of data provided by Christodoulos A. Floudas, a professor at Princeton University. In a study comparing FT with MTG processes, he demonstrated that MTG is consistently more cost-effective, in terms of both capital and overall costs, than FT at small, medium and large scales. Because Primus’ STG+ process is more energetically efficient and less costly to build than MTG processes, it promises to be more efficient, cost effective and scalable than these competing GTL processes for a large range of GTL applications, even at scales as small as 6,000 bpd or smaller.

At present, Primus is leveraging the low cost of natural gas to enhance the economics of its GTL process. Primus plans to incorporate biomass feedstock into its business model after the economics of gasifying such feedstocks improve.

GP. A patent application for the STG+ technology was accepted by the US Patent and Trademark Office. What does this mean for the future of Primus Green Energy?

GB. The approval of this patent is an important milestone, as it confirms that the single-loop feature of the STG+ process is truly novel. In addition, this new patent allows Primus to strengthen its intellectual property portfolio.

GP. What types of feedstock are in use at Primus’ demonstration plant, and what fuels are being produced? Also, how have the produced fuels been tested, and what results have been achieved?

GB. Our demonstration plant uses natural gas as a feedstock to produce 90-plus octane gasoline directly, via a single-loop process. We plan to begin the production of jet fuel and diesel fuel later this year, in addition to the development of solvents. As mentioned, we plan to incorporate biomass feedstocks into our business model once the improving economics of biomass gasification yield a more economically attractive biomass-derived syngas.

Our drop-in gasoline has undergone extensive third-party testing, and it has been verified to meet or exceed all ASTM International standards by independent laboratories, including Bureau Veritas; ASTM is the industry metric by which gasoline is measured. Specifically, as compared to traditional gasoline, our gasoline exhibits far lower sulfur content, lower benzene content, minimal corrosion and the lowest degradation possible. In addition, our gasoline was also tested for oxidation (fuel stability) and corrosion potential, in accordance with standard ASTM International test procedures. Both oxidation and corrosion potential results were excellent. The gasoline produced at our demonstration plant has consistently produced these results.

Furthermore, because of its high quality and low sulfur and benzene contents, our gasoline exceeds the US Environment Protection Agency’s proposed Tier 3 standards for sulfur content and carbon emissions, and it has a lower GREET score than petroleum-based fuels. (GREET is the Greenhouse gas, Regulated Emissions, and Energy use in Transportation model, developed by Argonne National Laboratory.)

GP. Primus is breaking ground on a commercial-scale plant in 2014. What essential operations data and “lessons learned” will Primus incorporate into this project from
the demonstration plant run?

GB. Operations at our demonstration plant, which was designed as a scaled-down version of our first commercial plant, have enabled us to identify opportunities to fine-tune the STG+ process. Most importantly, we’ve learned key lessons related to two factors: syngas quality and catalyst performance.

Specifically, we’ve learned that the requirements for the composition of syngas used in our process are less stringent than anticipated. The relaxed requirements will result in a 40% savings in feedstock costs at the first commercial plant. We’ve also learned that the catalysts used in our process last much longer than originally expected. Instead of regenerating the catalysts every six months, this will only have to be done every two years, which will also result in considerable savings.

GP. Does Primus plan to build any more plants?

GB. Our focus is on the first commercial plant, which is expected to produce more than 28 million gallons per year (MMgpy) of fuel, starting in 2016. We expected to start construction on that plant later in 2014, with the exact location to be determined. We do foresee the construction of additional large-scale commercial plants in the future, though we are focused on the first plant.

There is also a sizeable market opportunity for our STG+ technology at a small scale, to address the problems of flared gas and stranded gas.

GP. At which types of locations, and in which world regions, do you see investment opportunities for small-scale GTL technologies, in general, and for STG+ technology, specifically, going forward?

GB. The opportunity for large-scale GTL plants that use the STG+ technology is a global one. Any location that offers a cost-effective source of syngas (produced through any carbon-rich feedstock, including natural gas) can benefit from our technology. For example, here in the US, natural gas is a domestically abundant resource, and gas prices are at or near 10-year lows. This scenario presents a highly lucrative opportunity to cost-effectively produce liquid products directly from natural gas, helping the US reduce its reliance on petroleum and reduce carbon emissions (since natural gas produces a cleaner-burning fuel than does petroleum-based fuels).

Additionally, because our STG+ technology is cost-effective at scales of 6,000 bpd or smaller, there is a huge opportunity for flared gas or stranded gas applications, which are a major challenge for the oil and gas industry. According to estimates from the World Bank-led Global Gas Flaring Reduction (GGFR) Partnership, which strives to overcome barriers to the reduction of flaring, about 5.3 Tcf of gas are being flared globally. The US is the fifth-largest flaring country, topped only by Russia, Nigeria, Iran and Iraq. In total, flared gas is a $20 billion global opportunity.

The economics and practicality of deploying offtake technologies at small scales have been the main challenges in flared gas reduction, but STG+ has been proven to produce liquid products economically, at scales as low as 350 bpd. STG+ provides an end-to-end, unattended solution that converts flared gas into a variety of liquid fuels, including drop-in gasoline and diesel or a product that is miscible in crude oil. Furthermore, our flared gas GTL units, designed to produce 500 bpd or 2,000 bpd, are fully fabricated and tested in the factory and then trucked to the site. Onsite, they are placed on a pad, bolted together and connected to local inputs and outputs. The units can be readily disassembled, moved to another location and reassembled. STG+ represents the first truly small-scale GTL solution, enabling it to be easily deployed onsite, at oil fields around the world, to reduce flare gas.

At present, we are in discussions with potential partners about flared gas applications, and we look forward to announcing news on these discussions in the future. GP

The STG+ experience: Present and future In October 2013, Primus Green Energy successfully commissioned its 100,000-gpy pre-commercial demonstration plant (Fig. 1), which converts natural gas directly into drop-in 90-plus-octane gasoline via Primus’ proprietary STG+ single-loop GTL process. This plant was designed as a scaled-down version of the company’s first commercial plant, enabling Primus to optimize the process at its Hillsborough, New Jersey headquarters, thereby significantly mitigating any technological risk to scale-up. Fig. 1. Primus Green Energy’s 100,000-gpy pre-commercial demonstration plant  in Hillsborough, New Jersey converts natural gas directly into 90-plus-octane gasoline. At the time of commissioning, the demonstration plant was operated continuously for over 720 hours (hr)—a major milestone—with excellent results. The purpose of the demonstration plant run was twofold: To identify opportunities to fine-tune the STG+ process and to verify the quality of the drop-in gasoline produced. Operations at the demonstration plant provided Primus with significant insight to inform its commercial operations. The company learned that the requirements for the composition of syngas used in its STG+ process are less stringent than anticipated. Originally, it was believed that a hydrogen-to-carbon-monoxide ratio of 2.1 to 1 would be required to produce high-quality liquid products. The company also discovered that lower-quality syngas can be used, with the relaxed requirements resulting in a 40% savings in feedstock costs for the first commercial plant. Additionally, Primus learned through continuous operation that the catalysts used in the STG+ process—which include molecular size- and shape-selective zeolite catalysts and commercially available shape-selective catalysts, such as ZSM-5—last much longer than expected. The catalysts will only need to be regenerated every two years, instead of every six months. This advantage will also enable the company to save significant costs during the operation of the first commercial plant. Importantly, these results were confirmed by a third party—specifically, an independent engineering firm. An independent engineer’s report, prepared by E3 Consulting LLC, concluded that the STG+ system and catalyst performance exceeded expectations during plant operation. The report noted that the demonstration plant has substantially met the goal of fully integrated operations; that it is a successful demonstration of the scalability of the technology; and that the gasoline quality consistently meets or exceeds industry standards. As Paul Plath, president of E3 Consulting, stated, “The data resulting from the initial 720-hr continuous operation of Primus’ natural gas-to-gasoline demonstration plant has exceeded initial expectations. The data shows that Primus’ STG+ technology, when applied at commercial scale, can be expected to be efficient, cost-effective and able to produce a premium transportation fuel product.” The demonstration plant results also verified the high quality of the 90-plus-octane drop-in gasoline. Previously, two independent testing laboratories, including Bureau Veritas, tested the gasoline produced at the pilot plant, which is also at the Hillsborough complex. More recently, gasoline produced by the demonstration plant in September and October 2013 was continuously sampled and analyzed by Primus and by the independent laboratory Bureau Veritas. In all instances, the tested gasoline quality of the demonstration plant gasoline samples met or exceeded ASTM International standards—the “gold standard” by which gasoline is measured today. Specifically, as compared to traditional gasoline, the produced gasoline exhibited far lower sulfur content (less than 1 parts per million [ppm] vs. 30 ppm), lower benzene content (0.16% vs. 0.62%), minimal corrosion and the lowest degradation possible. Furthermore, the gasoline demonstrated far less durene content (< 0.1%, as compared to < 1%), making it a much more desirable fuel. In addition to the results outlined above, Primus’ gasoline was also tested for oxidation (i.e., fuel stability) and corrosion potential in accordance with standard ASTM International test procedures. Both oxidation and corrosion potential results were excellent. During the run, Primus intentionally varied the operating conditions (recycle ratios, operating pressures, temperatures, etc.) to better understand how the process responds, and to explore operating condition boundaries. During this run period, Primus optimized its process by identifying specific operating conditions that would repeatedly produce optimum product, including high (> 91) octane. Following the successful run in October 2013, Primus completed a 900-plus-hr run of its demonstration plant in May. This latest run again confirmed the system performance and capital and operating expenditure findings from the initial run. Operation of the demonstration plant has validated Primus’ patent-protected STG+ process, confirming its commercial readiness. Primus is working to finalize site selection and financing for its first commercial plant, on which it expects to break ground in 2014. The plant is expected to produce 28 MMgpy, beginning in 2016. The company will co-locate its first commercial plant near established feedstock delivery infrastructure. Since the first commercial plant is expected to use natural gas as the primary feedstock, natural gas pipeline infrastructure is a key criterion in selecting the final location. GP

  

Dr. George Boyajian is a technology entrepreneur with 18 years of experience as a senior executive. He has launched several companies, including a plant genetic engineering venture and a medical device company that was acquired by GE Healthcare. Dr. Boyajian’s expertise includes business development, licensing, public relations, raising financing, vendor relations and government relations. Prior to his business career, he was an assistant professor for six years at the University of Pennsylvania. He received his BA degree in geology from the University of Pennsylvania and his PhD in geology from the University of Chicago.