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Several drivers support a case for XTL fuels. Some are from the supply side: Monetizing stranded natural gas is becoming increasingly important in certain regions and GTL is becoming increasingly more attractive as a means of achieving that goal. However, some drivers are from the demand side: The demand for clean diesel fuel is growing and the capacity for producing it is becoming constrained in key markets.
The major drivers for the construction or expansion of GTL/CTL operations are:
• A significant resource base of stranded gas (or coal) available at relatively low cost and motivation for governments and producing companies to monetize this resource.
• An economic upside as oil prices begin to rise or at least plateau at a high level relative to historic price ranges.
• Increasing demand for high-quality products (lower sulfur and higher cetane) and a correlative increase in sulfur level of global crude feedstock.
Other drivers include:• Environmental and political reasons to reduce or eliminate flaring.
• Opportunities to optimize economics through integration with other gas-development projects.
• The emergence of new technologies that help bring high volumes of cheap shale gas to the market.
• In the case of CTL, a significant coal resource base available at relatively low cost in areas with growing fuel demand.
• BTL drivers are largely predicated on the availability of low-cost biomass resources and economic end-product incentives. In areas of elevated distillate fuel pricing, such as Europe, an eventual economic arbitrage awaits further commercialization of technologies designed to handle the complex feedstock and syngas cleanup steps required for biomass processing. Specialty chemicals such as methanol and higher alcohols, or specific distillate fuels, may offer a distinct advantage. For example, through selective adjustment of catalysts and management of the Fischer-Tropsch approach, jet fuel (kerosene) selectivity can reach 70%, far higher than large refiners are capable of or willing to do.
• WTL drivers are largely predicated by the confluence of three factors: high tipping fees (typically more than $90 per ton), elevated electricity pricing (as exothermic processes such as Fischer-Tropsch produce excess thermal energy), and incentives for renewable fuel production. In areas without these factors, the prioritization of niche, specialty chemicals is a potential route. In current markets, competition with refined products is unlikely given the cost of alternative processing. Furthermore, as with biomass, complex feedstock processing and syngas cleanup steps give WTL disadvantages compared to other processes. Even with advantaged processing techniques, the nature of waste management, whereby waste must be secured under long-term contract to divert it from landfills and other treatment options ─ including recycling, anaerobic digestion and mass-burn incineration ─ imposes a theoretical maximum scale of project. Thus far, no waste-based gasification project has entered commercial operations at scales greater than 50 megawatts thermal.