Members of a joint industry project examining the possibilities for a commercial offshore gas to liquids (GTL) plant are ready to look for a real field development to test their findings.

Four contractors embarked on the Seagas Joint Industry Project more than 2 years ago to look at the potential for commercializing GTL offshore.

Spanish shipbuilder Izar, which has the facility to build a large hull at its Fene shipyard in north-west Spain; linked with engineering and process specialist Foster Wheeler, allied with floating production operator Bluewater of The Netherlands; and certification agency Den Norske Veritas (DNV), commenced the program in January 2002. Team members now need to find an oil field to develop containing substantial associated gas, which could use GTL technology to turn a profit.

"Originally Izar approached us," explained Steve Spicer, business development director for global upstream oil and gas at Foster Wheeler, when asked about the origins of the project. The budget was a conservative US $2.37 million "We deliberately kept it tight," Spicer said.

Spicer commented that his company regards offshore GTL as a technology with a big future, "We saw it as a concept that had longer term opportunities because stranded gas and associated gas anywhere provide a niche for a floating GTL solution," he said.

The first phase of the JIP was a peer group review of existing knowledge within the field of GTL technology. Phase 2 of the JIP concentrated firstly on establishing a design basis for an offshore GTL system, aiming for an optimum GTL process suitable for marinization. This phase also involved process simulations and work on equipment sizing and layout studies which were completed in April, 2003. A hazard identification (HAZID) process was also carried out, part of which included a 2-day workshop in Oslo run by DNV, and more recently, cost modeling.

Phase 3 is planned to be a conceptual design stage, looking at specific field applications.
Gas to liquids technology is not new. During World War II, Germany used it to produce fuel oil from coal gas. Sasol in South Africa has had long experience and expertise in the technology for both historical and political reasons - due to its isolation during the years of apartheid and trade embargoes.

"South Africa became the leaders in the technology," Spicer said. "And we have been working with Sasol on GTL commercialization plants for more than 5 years - primarily for onshore plants."

Taking the technology offshore should drive development of new deep oil reserves where there is a high proportion of associated gas and where other gas disposal options, such as re-injection, export pipelines or flaring are not available due to reservoir, technical, commercial, or environmental constraints.

Work to date has been based on a benign West African field location in deep water and with a substantial oil reservoir. The selection of benign sea conditions offers advantages for both the design of the ship and GTL topsides.

John Spokes, senior project manager at Foster Wheeler, who has been involved with the JIP, said, "The economics mean that the oil to be processed needs to be in the high range for FPSOs (floating production, storage and offloading vessels) with a relatively large quantity of associated gas. We chose 150,000 b/d of oil production with an associated gas output ideally in the range 120 to 180 MMcf/d. Thus, we are looking for a fairly specific type of field."

He pointed out the GTL plant is going to be fairly large and of course needs to complement the oil processing facilities.

"A particularly important factor is the selection of the appropriate GTL process in the marine environment. We screened ten generic GTL processes, which were ranked with the objective of selecting one for marinization."

"The process we have selected uses oxygen for the production of syngas," Spokes declared. "Thus the Seagas project requires an air separation plant to be included in the topsides process facilities. Although this adds to the potential hazard profile, this is manageable. Alternative processes which use just air are less efficient and require more plant and space for the same capacity."

Obviously a substantial ship would be required to support topsides of the magnitude envisaged. That could be seen as a downside. However, Spicer pointed out, "This is an application for a benign deepwater environment, and by definition nobody goes into deepwater looking for small oil fields. In any case many of the large fields being developed offshore West Africa boast reserves of 600 million to 1 billion barrels with daily oil production estimates of up to 250,000 b/d - big enough to support large FPSOs, so here, the Seagas concept could well fit. A typical 50,000 b/d oil field is not enough."
Izar's primary contribution to the JIP is the capability to design and construct the very large vessel required. Izar has done extensive detailed work on the hull options, evaluating a single Ultra-Large FPSO 918 ft by 328 ft (280 m by 100 m), tandem mooring of two smaller hulls or the configuration of two hulls as a catamaran. This last idea, which evolved from one of the team's peer reviews, requires a module support frame across the hulls, is said to possess good sea-keeping and motion characteristics and looks particularly promising.

Product

The conversion of gas, to what is effectively a synthetic crude - syncrude - would produce a high melting point wax, very pure with no sulphur and no contaminants. Storing the syncrude product separately is not particularly viable. Spokes points out that to keep produced syncrude in liquid form for transport and offloading would require it to be kept heated at approximately 282°F (140° C). The JIP considers the best option is to dissolve the syncrude in the stabilized oil. The alternative is to use a 'product work-up' unit to convert the wax to a more easily handled liquid. This, however, adds significant complexity, weight and cost to the topsides and does not compensate for the loss in premium value that occurs when the syncrude and normal crude are mixed.

Bringing an oxygen production process onto the topsides has very big implications for the safety of the facility because of the danger this represents if oxygen were to come into contact with hydrocarbons. Much of the HAZID work led by DNV has been about establishing and evaluating exactly what dangers exist within the process and how these can be managed and mitigated. Topsides layout is of particular relevance here and much work has been done on unit segregation, provision of blast and fire protection and escape, evacuation and rescue.

Spicer declared that since the work has begun, there has been ". . . a lot of interest" in the project. "We have the major building blocks in place so that we can run different process and hull configurations, together with permutations of field size to derive technical solutions and associated costs."
"We have taken this to a stage where we know what the technical issues are. We know what things are a still a hurdle and we know where the commercial issues lie," Spicer said. "Some more work needs to be done on marinization of the syngas reactors and the catalyst handling process," Spokes added. "This aspect is likely to be client-specific. However, there are no show-stoppers as far as we can ascertain and the team is now seeking a real field development project on which to apply its expertise."
Spicer said Seagas can work. "Costs show it is economically viable," he stated. "It would provide successful rates [of return]."

He concluded, "Foster Wheeler has made significant advances in GTL and the work carried out during the last 5 years on land-based plants has shown that the combined tools of process simplification, innovation and optimization, value engineering and cost reduction can, and have, resulted in the successful implementation of GTL plants, notably in Qatar and soon we expect in Nigeria."

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