Shell signs $5bn Gulf deal

[emad]

The UK's BBC News reports that:


Anglo-Dutch energy giant Shell has signed a $5bn (£3bn) deal to build an energy plant in the Gulf state of Qatar to convert natural gas into liquid fuel. Gas to liquid, or GTL technology, produces cleaner fuel, according to Shell. The energy giant signed the agreement with state-run firm Qatar Petroleum. "Together they're planning to create a plant in this tiny desert state which is the largest of its kind in the world," said BBC News correspondent in Qatar, Julia Wheeler.

The agreement was signed by Shell chairman Sir Philip Watts and Qatar's Energy Minister Abdullah Hamad Al-Attiya. "Shell will be building the first world scale gas to liquid projects, " Sir Philip told BBC Radio 4's Today programme. "Qatar is supplying the gas; Shell is supply the technology," said Ms Wheeler. The plant will eventually produce around 137,000 barrels of liquefied fuels per day by the time it comes fully on stream by the year 2011.

The Qatar plant will produce both naphtha and environmentally friendly diesel and is being billed as capable of creating a green revolution for car drivers. With current technology, over the full life cycle, this will be carbon dioxide neutral when compared with other technology . Also known as white crude, Shell insists fuel converted from liquid gas is significantly more environmentally friendly than traditional petrol or diesel. But the refining process does produce the carbon dioxide omissions which are blamed for global warming. "With current technology, over the full life cycle, this will be carbon dioxide neutral when compared with other technology," Sir Philip said. "Over time, not only will these projects be cheaper, they will also be more environmentally friendly."

At first the target is for buses in big cities to use the new fuel because they can be filled up at central depots. Eventually Shell says car drivers should be able to fill up at petrol pumps, but this requires huge volumes of so called white crude. For the tiny desert state of Qatar, business is good. Last week the energy minister signed a $12bn deal with Shell's rival, Exxon Mobil.

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http://news.bbc.co.uk/1/hi/business/3206510.stm

[FlashHarry]

1. So why not get on the BioDiesel wagon?

I mean, this story is good news, but BioDiesel would be better, right? It's renewable, clean(er), and it could be produced domestically. Think of all the 18-wheeler trucks you see on the road. Imagine if they all ran on BioDiesel. We could cut our dependence on foreign oil by a huge amount. And, as far as I know, it doesn't require too serious a conversion--I think certain seals and gaskets need to be replaced. This means, it could be used with existing diesel engines, with a slight modification.

So why aren't we doing it?

[punpirate]

2. Is it good news, in fact?

I'd love to see the numbers on this. They're trying to describe this as "carbon dioxide neutral" likely because there's a lower CO2 emission level in this process than in traditional refining of crude oil.

So, it only works if raw carbon is removed during the process, which reduces fuel value from an already low energy fuel, natural gas. If the process does not remove raw carbon, then that carbon gets burned in the vehicle's engine and goes out the tailpipe as CO2. If it does remove carbon, more fuel has to be burned for equivalent fuel value.

This, I think, is not an environmental tool, but rather a marketing scheme. For engines to run natural gas requires expensive conversion, but to run a liquid fuel, such as naphtha, only a rejetting of a carburetor, or recalibration of an engine computer fuel map.

Qatar likely has lots of natural gas, no way to liquefy it economically, and therefore no way to sell it economically.

And, here's the kicker with regard to the claim that it's "CO2 neutral": if it came out of the ground and one burns it, it adds to the atmospheric CO2 load.

The only truly CO2 neutral process is based on agricultural products, or some other yet to be developed process which can fix CO2 from the atmosphere.

Bio-diesel is an example. However, with regard to its widespread use in big trucks, it's a question of supply. When the vehicle is getting a couple of miles per gallon, not only does there have to be a lot of it, but it has to be available at all fueling points, in order to be widely accepted.

Cheers.

[emad]

3. Try filling your car engine with vegetable oil in the UK and they

bust you for evasion of fuel excise/duty....plus it semlls like a mobile old fish and chip shop frying haddock, instead of the latest FWD automatic, hehe