Oil & Gas Training

1. Oil & Gas Training GTL

2. Gas-to-Liquids (GTL): The Definition For this course… • GTL is a physical-chemical process that is an attractive option to commercialize stranded natural gas reserves. The process tears apart natural gas molecules and reassembles them into stable, longer change molecules or synthetic oil. It can then be further processed into clean commercial products (e.g., diesel fuel, naphtha, wax or specialty products). Resulting products are very stable and can be transported in tankers and used in vehicle fleets. • The basic GTL process, developed in the 20’s, is known as the Fisher-Tropsch (F-T) process – a catalytic reaction to synthesize complex hydrocarbons from simpler organics. A similar application is also used by SASOL in South Africa. • Recently there have been many F-T improvements achieved in reactor design and product recovery. Today, the modern F-T process can create a wide range of liquid fuels at a required economic hurdle rate of $25-$26 per barrel, versus previous rates above $30/bbl. • Finally, do not confuse GTL with natural gas liquids (NGL), liquefied petroleum gas (LPG), or compressed natural gas (CNG). These products involve only a change in the original physical state from gas to liquid by a change of temperature and/or pressure. Basic molecular structure has not been altered. Likewise, there is no similarity between GTL and liquefied natural gas (LNG). Again, LNG is a change in the physical state of methane - in this case, through high pressure and extremely low temperature. Source: Lehman Brothers

3. 1 Natural Gas Reforming In this stage, natural gas is partially oxidized at a high temperature and pressure into syngas (a mixture of hydrogen and carbon monoxide). The natural gas is preheated and fed to the reforming reactor, where the main reactions take place 3 Finally, standard hydrocracking and hydroisomerisation is used to fine-tune the middle distillate product range by selective cracking and fractionation. Gas-to-Liquids: Process How it works - Schematic design of basic GTL Process… Air Natural gas 500 mmcl/d Air Separation Gas Processing LPGs Oxygen 250 mmcl/d Naphtha Kerosene/Diesel LPG 1 Synthesis Gas Production CO 2 Fischer- Tropsch 3 Product Refining / Export H2O Fischer-Tropsch Conversion The second stage is the heart of the GLT process, here, syngas is converted into a broad range of hydrocarbons. The major factors affecting the success results of F-T process are reactor design (fixed-bed, fluidized-bed, and slurry), configuration and catalyst (iron or cobalt-based) which together affect conversion rate and operating cost. 2 Source: Gas Processing Assoc – Lehman Brothers

4. Gas-to-Liquids: Products What it makes - Very clean commercial grade liquid products… Preliminary Product Yield of GTL Process Final Product Yield of GTL Process Product Yield % Volume Wax 43% Diesel 17% Linear Alpha Olefins 15% Naphtha 14% Linear Parafins 11% Total 100% Product Yield % Volume Diesel 50% Naphtha 30% Lubricant & Base Oil 20% Total 100% Source: Lehman Brothers

5. Gas to Liquids Leader: Qatar The potential, the players… • If all GTL prospects in Qatar currently under construction, negotiation, or study move forward, production capacity could exceed 1 million bbl/day in 10 years. This compares to Qatar’s current oil production of 780,000 barrels a day, creating the world’s first major GTL hub. ExxonMobil GTL 26% Oryx GTL Project 3% Qatar ConocoPhillips Phase 1&2 19% Sasol ChevronTexaco Integrated GTL 17% Pearl GTL Phase 1&2 17% Qatar Marathon Phase 1&2 17% Source: Company data, Lehman Brothers