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Economic and Environmental Barriers to
Implementing Coal-to-Liquid Energy
2014 Clean Energy Workshop
Richard D. Boardman, Ph.D. Chem. Eng. Manager, Energy Systems Integration
September 14-15, 2014
Taiyuan, Shanxi Province
Work Sponsored by Wyoming State
Wyoming Coal Deposits
Strippable Coal (million of short tons)*
Powder River Basin
570,000
Greater Green River 2,700
Hanna-Carbon
7,200
* USGS, 1999 Resource Assessment
2
Major Barriers to implementing CLT
• Environmental Risks of Pollutant Emissions and Water Withdrawals
• Technical Risk Associated with Syngas Cleanup and Fuels Synthesis
• Custom Equipment Supply Chain and Limited Construction Experience
• Operational Control Risks Associated with Complex, Highly Co-Dependent Plant Operations
• Economic Pro-forma Uncertainty Relative to Conventional Oil
• Capital Investment Competition with Subsidized Energy Sources
3
Coal Gasification and Conversion to Fuels & Chemicals
4
Gasification (Syngas Production)
CO, H2, CO2
Air Separation
O2 and N2
Syngas Cleanup
& Conditioning
CO2 for EOR or
Sequestration
Indirect Liquid
Fuel Synthesis
(CTL & C/MTG)
Methane
Synthesis
Ammonia
Synthesis
Combined Gas
& Steam
Turbines
Transportation
Fuels & Chemical
Feedstock
Gas Pipeline
Ammonium
Nitrate
Clean
Electrical
Power
Coal
& Biomass Air
O2
CO CO2 H2
N2
Liquids
SNG
NH3
Tail gas
Coal to Methanol & Methanol to Gasoline Process
5
Water
Scrubber
Coal
Slag
Black
Water
System
Soot
Syngas
Superheated
Steam
BFW
BFW Pump
Activated
Carbon Bed
(optional)
Compression
Syngas
Cooler
Steam
BFW
(jacket)
Syngas
Steam
(jacket)
Steam
Cyclone
Fly Ash
Condenser
Water
Rectisol Process +
Sulfur Guard Beds
(H2S, CO2 Removal)
Purge Gas
CO, H2
H2S, CO2
Claus
Process
Elemental Sulfur Byproduct
SCOT
Process
Claus
Tail
Gas
SCOT
Offgas
CO2
Generator
Condensing
and Saturated
Steam Turbines
Entrained
Flow
Gasifier
Pulverizer
Coal
Drying
Coal
(Dried &
Sized)
SeparationGas
Gasoline
Column
Heavy
Gasoline
MeOH
Reactor
Tail Gas
Recycle
Quench
GasBFW
BFW
Steam
Cryogenic
ASUAir
O2
N2
Sour
Shift
Reactors
Steam
Compression
Pump
CO2
Byproduct
TEG
Dehydration
Unit
HRSG
Air
Exhaust
Gas
Stack
Exhaust Gas
BFW
Steam Generated
via Heat Recovery
Gas Turbine Generator
Compressor
Light
Gasoline
Separation
Tail
Gas
BFW
Steam
Shift
Bypass
Depropanizer
Column A
DeEthanizer
Column
LPGC2
Fuel Gas
BFW
Steam
Ar
Compression
DME
ReactorBFW
Steam
MTG
Reactor
BFW
Steam
Cooler
E-329
Depropanizer
Column B
Treated
Gasoline
Blending
Finished
Gasoline
LPG
Hydro-
Treater
Hydrogen
Coal to Methanol & Methanol to Gasoline Process
6
Water
Scrubber
Coal
Slag
Black
Water
System
Soot
Syngas
Superheated
Steam
BFW
BFW Pump
Activated
Carbon Bed
(optional)
Compression
Syngas
Cooler
Steam
BFW
(jacket)
Syngas
Steam
(jacket)
Steam
Cyclone
Fly Ash
Condenser
Water
Rectisol Process +
Sulfur Guard Beds
(H2S, CO2 Removal)
Purge Gas
CO, H2
H2S, CO2
Claus
Process
Elemental Sulfur Byproduct
SCOT
Process
Claus
Tail
Gas
SCOT
Offgas
CO2
Generator
Condensing
and Saturated
Steam Turbines
Entrained
Flow
Gasifier
Pulverizer
Coal
Drying
Coal
(Dried &
Sized)
SeparationGas
Gasoline
Column
Heavy
Gasoline
MeOH
Reactor
Tail Gas
Recycle
Quench
GasBFW
BFW
Steam
Cryogenic
ASUAir
O2
N2
Sour
Shift
Reactors
Steam
Compression
Pump
CO2
Byproduct
TEG
Dehydration
Unit
HRSG
Air
Exhaust
Gas
Stack
Exhaust Gas
BFW
Steam Generated
via Heat Recovery
Gas Turbine Generator
Compressor
Light
Gasoline
Separation
Tail
Gas
BFW
Steam
Shift
Bypass
Depropanizer
Column A
DeEthanizer
Column
LPGC2
Fuel Gas
BFW
Steam
Ar
Compression
DME
ReactorBFW
Steam
MTG
Reactor
BFW
Steam
Cooler
E-329
Depropanizer
Column B
Treated
Gasoline
Blending
Finished
Gasoline
LPG
Hydro-
Treater
Hydrogen
Gasification
and Hydrogen
Adjustment
Syngas
Cleanup:
Sulfur &
CO2
Separation
for EOR
Methonal,
DME,
Oxygenate
Synthesis
Motor Gasoline
Production
Power Generation
(CO2 emissions)
7
Coal Conversion to Fuels by Fischer-Tropsch Process
8
Gasification
and Hydrogen
Adjustment
Syngas
Cleanup:
Sulfur &
CO2
Separation
for EOR
Fuels
Synthesis (Co Catalyst)
Power Generation
(CO2 emissions)
Coal Conversion to Fuels by Fischer-Tropsch Process
9
GE-CVX
(Texaco)
EGAS
(Destec)
Siemens
(Noell)
Developing gasifiers:
KBR Transport
Rocketdyne
GE – dry feed
Fixed-Bed
(Lurgi)
Shell (SGP)
Uhde (Prenflow)
GTI (U-Gas, fluid bed)
INL Submodels Based on Test Results of Commercial Gasifiers
F-T: Anderson-Schulz-Flory Product Distribution
• F-T models in FORTRAN
• Fixed-Bed or Slurry-Bubble-Column reactor models
• Based on catalyst performance data given chain growth probability and product selectivity data
Methanol Conversion to Alcohols & Oxygentates
Methanol
CO2 +3H2 CH3OH + H2O
CO + 2H2 CH3OH
Di-Methyl Ether
2CH3OH CH3OCH3 + H2O (DME)
Gasoline
nCH3OCH3 CxHyOz + nH2O
(ZSM-5 catalytic MTG)
Developed by ExxonMobil
• Methanol and MTG Reactor Submodels calibrated to published data
Simplified Chilled Methanol Gas Cleanup
• Modeled in FORTRAN with custom thermodynamic data
• H2S and CO2 selectively separated
• Problem: CO2 stripping column modification necessary to achieve CO2 purity for liquefaction (97.5% attained)
• Solution: Strip CO2 with steam and less N2
• Impact: Increases methanol reflux chiller electrical duty
12
Aspen Process Modeling Results for Wyoming Coal
Coal / FT Coal / MTG
Coal Feed Rate (ton/day) 36,300 31,100
Liquid Product Summary 49,000 bbl/day 60,400 bbl/day
Diesel (bbl/day) 35,200 -
Gasoline (bbl/day) - 52,200
Naphtha(bbl/day) 12,700 -
LPG (bbl/day) 2,000 8,200
Electrical Power (MW) (+) 103 (-) 462
(Export Required) (Import Required)
Total CO2 Produced (MMSCFD) 845 555
Capturable CO2 (MMSCFD) 583 530
CO2 Emitted (MMSCFD) 262 25
(plus power plant emissions)
Water Summary
Water Consumed (gpm) 23,700 15,900
Potential Water Recovery
from Coal Drying (gpm) 8,000 1,200
14
Economic Pro Forma Example: Methanol to Fuels
• Greater than 50% of capital cost is associated with gasification and syngas clean-up unit operations
• Methanol/MGT process
capital equipment costs
• Scaled and factored cost
adjusted
• $5.6 Billion Total Capital
Investment (TCI)
• $92,000 per barrel installed
15
Economic Pro Forma Example: Methanol to Fuels
• Coal feed costs range from 10-30% of CTL costs
• Catalysts range from 15-25% of CTL operating costs
• Electricity costs are 25% of manufacturing costs
• 75% of electrical power duty is associated with oxygen supply, gas cleaning, and CO2 processing (compression)
Price Consumed Annual Cost
Direct Costs
Materials
Coal 10.51 $/ton 31,124 ton/day $105,069,447
Fly Ash Disposal 15.00 $/ton 648 ton/day $3,122,064
Rectisol Solvent 1.10 $/gal 4,628 gal/day $1,760,861
Makeup H2O Treatment 0.046 $/k-gal 28,027
k-gal/day $237,120
Wastewater Treatment 1.41 $/k-gal 8,138 k-gal/day $3,701,736
Claus Catalyst 21.00 $/ft3 5.48 ft3/day $36,969
SCOT Catalyst 0.16 $/ft3 0.80 ft3/day $40
Carbon, Hg Guard Bed 5.56 $/lb 35
lb/day $62,960
Zinc Oxide 300 $/ft3 1.042 ft3/day $100,397
WGS Catalyst 825 $/ft3 387 lb/day $102,483,481
Iron Sorbent (Zeolite) 10.07 $/lb 43 lb/day $140,356
Methanol Catalyst 750 $/ft3 0.412 ft3/day $0
DME Catalyst 840 $/ft3 0.264 ft3/day $99,209
MTG Catalyst 54.26 $/lb 0.412 lb/day $71,182
HGT Catalyst 2500 $/ft3 1.30 ft3/day $41,436,215
CO2 Sequestration 14.54 $/ton 30,794 ton/day $1,047,014
Utilities
Electricity 1.67 $/kW-d 436,000 kW $283,924,432
Water 0.05 $/k-gal 27,735 k-gal/day $414,109
Royalties $1,050,694
Labor and Maintenance $234,219,262
Indirect Costs
Overhead $152,242,520
Insurance and Taxes $84,657,564
Manufacturing Costs $1,170,730,270
Natural Gas ($/MMBtu)
CO2 Sequestration
Internal Rate of Return (%) 20
Total Capital Investment
Capacity Factor (%)
Debt to Equity Ratio
Plant Life (yrs) 40 20
Loan Period (yrs) 30 15
$1
.25
$1
.35
$1
.38
$1
.40
$1
.50
$1
.70
$1
.80
$2
.00
$2
.10
$2
.20
$2
.30
$2
.40
$2
.50
$100/ton$50/ton
$1
.60
$1
.90
$1
.45
7
$1
.20
55/45
9.00
0.75
+30-30
6.5
16
PRB Coal
Natural Gas
CO2 penalty risks
are a significant
barrier to CTL
~$.50/gal taxes
~$0.15/gal distrib.
~$0.15 profit
= $0.80 add at pump
CO2 emissions
offset cost Financial Sensitivity
Life-Cycle Greenhouse Gas Emissions Assessment
• Emissions from production, transportation, conversion, and end use
17
Life-Cycle Assessment (LCA) of Greenhouse Gas Emissions
• Problem: Life-Cycle CO2 emissions exceed petroleum fuels baseline
• Solutions: 1. Use more biomass 2. Capture CO2 in flue gas discharge
3. Replace water-gas-shift 4. Use clean-power hybrid systems
• Impact: May increase cost depending on capital and operating cost tradeoffs
0
0.2
0.4
0.6
0.8
1
1.2
1.4
1.6
1.8
2
CTL CTL + 30%BM
CTL + CCS CTL + NG +CCS
Relative CO2 LCA Footprint
(50,000 bbl/day FT Plant)
Compared to LCA for
conventional petroleum
refining fuels
19
Hydrogen through hydrocarbon conversion Steam Reforming CH4 + H20 + ½ O2 = CO2 + 3H2
Shift Reaction CO + H20 = CO2 + H2
Water splitting using electrical and/or clean (nuclear) sensible heat: Electrolysis Thermal/Chemical Electro/Thermal (e.g. plasma) Electro/Chemical
Clean Hydrogen Production Alternatives
20
Steam Methane Reforming versus Nuclear-Assisted High Temperature Steam Electrolysis
• Nuclear reactor provides clean electricity and heat for high temperature steam electrolysis
• Oxygen co-product is used for gasification of coal
21
• Reduces Life-Cycle GHG emissions to minor combustion sources only, such as local fired-heaters
• 70% reduction in coal use
• Reduces number of gasifiers and gas cleanup capital and operating costs
Coal to Liquids Integration with Nuclear-Electrolysis Plant
22
Alternative Solution: Thermal-Chemical Hydrogen Production
• US Patent No. 8,366,902 B2 for HTSE (Idaho National Lab)
• Various thermal-chemical looping schemes are possible
• Syngas cooler design change require
GE-CVX
(Texaco)
Heat
Transfer
1,500 C Flame T
Small Modular Reactor Study Results
23
• Nuclear produced hydrogen is economically feasible for China with new nuclear reactors
• U.S. market depends on time-of-use electricity price
>$12 per MMBtu
in China
~$6.0 per MMBtu
projected for U.S.
• Small Modular
Reactor Technology
• Pressurized Light
Water Reactors in the
near term
• High Temperature
Reactors in the future
24
Wind Farm
Power
Converter
O2 H2
ElectricitySteam
Fuels Synthesis
Coal Power Plant
CO2 to
EOR
Oxy-fire
High T.
Steam
Electrolysis
Fuels
Coal and Biomass Water
ELECTICAL
GRID
Clean Coal – Synfuels – Renewable: Hybrid with Grid
• Firms renewables (wind and solar) on the electricity grid
• Optimizes capital equipment utilization factor
• Transfers “low GHG” energy into transportation fuels
Nuclear
SMR
Possible
25
Stress relieving
Heavy wall
plate rolling
Photos: High Country Fabrication, Inc.
Casper, Wyoming
Highway and rail limitations
14-ft diameter in U.S.
Plant Design, Fabrication, Construction, &Operation
• Problem: 1st-of-kind plants involve expensive pressure vessels engineering, fabrication & operational certainty risks
• Solution: Modular equipment fabrication and supply chain; Stream-line engineering, permitting and construction
• Impact: Reduces cost; ensures high on-line capacity factors
* Industry Investment
* U.S. DOE Labs
* University Research
* Computational Simulations
* Deployment *
26
RDD&D Partnerships…
Industrial
Deployment
State
Infrastructure
Authority Investment
Product
to
Market
RDD&D
Manufacturing
Supply Chain
* Applied R&D
* Pilot Demonstrations
Work-
Force
* Chinese Academy of Sciences
27
Short-Term Profits Driven Plan Strategic Holistic Energy Plan
Insurance against short-term oil
shortages caused by economic
disruption and oil supply interdiction
Long range energy planning for
production of domestically derived
replacement fuels, and hybrid systems
with all energy resources
Whole Life Insurance Term Insurance
OR
Opportunity Requires Vision and Strategy