Liquefied Natural Gas (LNG)
The Darwin LNG Facility. |
More than a third of the world’s natural gas resources are
classified as “stranded” – they are located too far from a market
or are too economically challenged to support development.
Historically, much of the stranded gas produced in conjunction
with crude oil was simply disposed of by flaring if it could not
be reinjected into the producing reservoir.
We are exploring ways of applying our liquefied natural gas
(LNG) expertise to unlock stranded gas in remote regions and
supply markets in North America, Asia and Europe, where it
can play an important role in satisfying future energy needs.
LNG is natural gas that has been cooled to minus 161 degrees
Celsius (minus 256 degrees Fahrenheit), at which point it
condenses to a liquid. This process, called liquefaction, reduces
its volume to one-600th of the original volume, making it
economical to ship LNG over long distances in specially
designed oceangoing LNG tankers. At its destination, the
LNG is converted back to gas and piped to customers for
power generation, industrial, residential and commercial use.
ConocoPhillips has been an industry leader in LNG technology
and project management for more than four decades. Our
proprietary ConocoPhillips Optimized CascadeSM Process was
developed in the 1960s for use at our LNG facility in Kenai,
Alaska, which is still an industry model for safety, efficiency
and reliability. We began marketing our liquefaction technology
to other operators in the 1990s and have sold licenses to the
owners of plants in Trinidad and Tobago, Egypt and
Equatorial Guinea.
In 2006, we began producing LNG at a new liquefaction
plant near Darwin, Australia, to supply customers in Japan.
It is the first LNG plant to use high-efficiency gas turbines to
power the refrigeration compressors which, combined with
waste heat recovery units, reduce greenhouse gas emissions.
We are pursuing plans for two other liquefaction plants to supply
U.S. markets – Brass LNG in Nigeria and Qatargas 3 in Qatar,
the latter proceeding toward a 2009 start-up. We own 30 percent
of the Qatargas 3 project, one of the world’s largest LNG
developments, which is expected to generate approximately
7.1 million metric tons of LNG per year. ConocoPhillips
signed an interim agreement to acquire an interest in the
Golden Pass LNG import terminal under construction near
Sabine, Texas, to receive and regasify LNG from Qatargas 3.
Also in Texas, we are overseeing construction of the
Freeport terminal, which is on schedule to start-up in 2008.
Freeport, which is located in one of the United States’ highest
gas-consuming regions, is the country’s first new LNG
terminal in more than 30 years. Located on the island of
Quintana close to open water, it was designed to handle the
world’s largest LNG tankers and will have an initial capacity
of 1.5 billion cubic feet per day.
Rigo Rodriguez pauses from construction of the Freeport LNG terminal,
the country’s first new LNG terminal in more than 30 years. |
LNG has been transported safely around the world for more
than 45 years. It is shipped in special double-hulled tankers
and does not need to be stored under pressure. We currently
co-own two LNG tankers, the Polar Eagle and the Arctic Sun,
which operate between Alaska and Japan. The Qatargas 3
project will use a new class of LNG supertanker substantially
larger than current carriers, to make transporting LNG to the
United States from the Middle East economically feasible. The
tankers will be the first with onboard equipment to reliquefy
gas that vaporizes inside the tanks in transit, resulting in zero
losses during shipment.
Natural Gas Pipelines
We continue to pursue natural gas pipeline projects with
co-venturers in Alaska and Canada. In Alaska, we are seeking
agreement on commercial terms that would enable construction
of a pipeline from the North Slope to markets in the Lower 48
states. Meanwhile, another proposed pipeline from the Mackenzie
Delta in Canada’s Northwest Territories to established gas
markets in North America is undergoing regulatory review.
We also have acquired an interest in the planned 1,663-mile
Rockies Express Pipeline project, our first large-scale
interstate natural gas pipeline. The $4.4 billion pipeline will
transport gas produced in New Mexico, Colorado and Wyoming
to markets in the Midwest and Eastern United States. The first
phase of the project is already in service, and the pipeline is
expected to be fully operational by mid-2009.
Clean Coal
We are developing proprietary technologies to convert coal
and other widely available carbon sources to a variety of
useful products, such as substitute natural gas, fertilizer, diesel
fuel, steam and hydrogen. One such method is with E-Gas™
Gasification Technology, a process which converts coal and
other low-grade feedstocks, such as petroleum coke, into clean,
synthetic gas.
The E-Gas technology is an efficient commercial process for
producing synthesis gas from carbon solids. The resulting
hydrogen-rich synthesis gas is ideally suited for use as a cleanburning
fuel in gas turbines to produce electricity and steam
for refining and power generation applications. Alternatively,
the synthesis gas can be further processed to pure hydrogen,
substitute natural gas or chemicals. The process can be adapted
for carbon dioxide (CO2) removal from the gas prior to
combustion or further processing – the purity of the resulting
CO2 stream being ideally suited to integrated carbon capture
and sequestration projects.
In power generation applications, the gasification process is
more efficient in converting coal to energy. It also produces
less CO2 per megawatt than conventional coal-fired power
stations, even without carbon capture. Carbon capture in
gasification processes is achieved with proven commercial
technologies, with less impact on plant output and efficiency
than post-combustion carbon capture.
E-Gas systems can achieve over 99 percent sulfur removal,
while also generating low NOx emissions and near-zero
particulate emissions. Virtually all impurities are removed
from coal, including mercury, and the minimal ash by-product
can be used as a construction material. The sulfur from the
feedstock is recovered as 99.99 percent pure elemental sulfur
which can be used in fertilizer applications.
In refining, the E-Gas technology can process high-sulfur
petroleum coke in generating power, steam and hydrogen for
the refinery and surrounding industrial users. We are exploring
opportunities to integrate the technology within our existing
operations to improve efficiency and facilitate carbon capture.
We also have licensed the technology to build an integratedgasification
combined-cycle (IGCC) power station for Excelsior
Energy in the Iron Range of northeastern Minnesota. The
Mesaba Energy project will be one of the cleanest and most
efficient coal-fired power plants in the world. The project’s first
unit will be capable of producing a net output of approximately
600 megawatts of electricity and is expected to be operational in
2012. The project features a hybrid particulate removal system,
as well as enhanced sulfur and mercury removal technologies.
E-Gas technology also is being used to develop a commercialscale
coal gasification project for Rentech Energy Midwest
Corporation in Illinois that will refuel an existing ammonia
fertilizer plant. A portion of the carbon in the coal feedstock is
used to produce another fertilizer product. This project also
will demonstrate the production of transportation fuels from
coal syngas using the owner’s proprietary catalyst process.
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