High gas prices and petcoke panic boost IGCC20 November 2000
Encouraging operating experience from gasification plants in the Netherlands and the USA, a reformed economic environment and a surplus of petcoke is resulting in a resurgence of orders around the world
In the space of six months, the relative gloom about the prospects of gasification technology and economics during the Amsterdam Gasification 4 Conference in April was turned to almost triumphant optimism at the San Francisco Gasification Technologies Conference in October.
This was not only due to the more positive operating results from established plants in the USA, it was to a large extent a “We always said this would happen” response to the recent doubling in natural gas prices (tripling over the year on the spot market in the UK as of 14 November), which many seem to think will continue on its upward trend, and the imminent ordering of a number of large, advanced, petcoke gasification units and some GW sized oil refinery residue gasification power plants.
The UK government has now lifted the de facto moratorium on gas-fired power plants, and on 20 November 2000 the European gas interconnector reversed flow from Belgium to the UK for the first time
The relative ease of disposal of CO2 from IGCC’s is another important factor, and with the growing pressure to revert to greener transport fuels, liquid from solid fuels processes also seem to be coming back on to the agenda with a vengeance.
Optimism was further enhanced by talk of industrial syngas trading operations which will buy the output of installed gasification plants to trade in competition with natural gas in the North American market. ExxonMobil are apparently already selling syngas from their newly commissioned Baytown Syngas Project in Texas, which started up in April 2000, to one such operation. This project, located within the ExxonMobil chemical plant complex, is fed by 1213 t/d of deashphalter bottoms from the adjacent refinery.
The prospect of producing profitable syngas without the complications of integration with an on-site combined cycle electricity generating plant might well appeal to some European punters who have experienced ongoing complications with gas turbine combustors and control system dynamics, but for existing gas fired combined cycle plants suddenly to be to turn to syngas would require some expensive plant modifications to accommodate the larger gas flows of the lower CV gas and beefed up power turbines.
US dash for gas
The rate of increase of installation of natural gas fired combined cycle power generation plants in the USA is currently quite phenomenal and gathering pace. Pace Global Energy Services recently presented a study of US natural gas supply and price outlook. This cited some 50 000 MW of new generating capacity nation-wide to enter commercial operation by 2004 of which 78 per cent is likely to be combined cycle plant and 22 per cent combustion turbine plant. Figure 1 shows the development of natural gas price in the USA from November 1996 to September 2000.
The key indicators of US rig count and gas price showed a startling rate of increase from April 1999 to September 2000 which appears to be continuing. There was little to suggest any prospect of a future turn-down in gas prices even in the longer term. Graphs of power generation/natural gas demand showed a steady linear rate of increase from 2000 to 2030 for high case, base case and low case (Figure 2).
On the gas supply front, the study shows how following several years of surplus the natural gas market is becoming increasingly stretched and that to supply future demands drilling will have to increase and the substantial resources in eight major frontier supply regions (see Table 1) will have to be tapped to meet projected demand.
The pet coke problem
An analysis by Mitretek investigated the potential for petroleum coke conversion at a generic refinery to produce a combination of products including hydrogen, electric power, and ultra-clean Fischer-Tropf liquid fuels. With the Environmental Protection Agency Tier 2 regulations pending, refineries will require additional hydrogen to hydrotreat and hydrocrack feeds to produce gasoline and diesel fuels with less than 30 ppm of sulphur.
This analysis indicates that pet coke could be a candidate feedstock for hydrogen production, especially if refiners have to pay in excess of $3.25/MMBtu for natural gas as steam reformer feed and oil prices stay above $25 per barrel. However, hydrogen availability is an important issue and refiners must be persuaded that gasification will prove to be as reliable a technology in the future as natural gas steam reforming is today.
Many refineries produce sufficient pet coke to more than satisfy refinery hydrogen requirements, and they are legally obliged to safely dispose of it. This leads to economic coproduction of hydrogen and power or Fischer-Tropf liquids. Many of these coproduction options look economically attractive when oil prices are above $25 per barrel or gas prices are above $3.25/MMBtu provided that the performance and cost estimates derived in this analysis can be substantiated in commercial practice.
Coproducing ultra-clean Fischer-Tropf liquids as blending stocks for ultra-low sulphur fuels production could be a viable option for refiners in the future if the WOP remains in the range of $25-$30/bbl. Thus, pet coke that is often of poor quality and low value could become an important feedstock for a refiner to produce not only his own hydrogen and power needs, but also to produce Fischer-Tropf blending stocks and power for export.
A good example is the newly installed Motiva Enterprises Delaware City Refinery Repowering Project (Figure 3). This is an integrated gasification combined cycle (IGCC) plant which will generate electric power and steam using petroleum coke produced at the adjacent refinery. Two Texaco Power and Gasification (TPG) dual oxygen blown gasifiers and an acid gas removal process will produce clean syngas for two combustion turbines and heat recovery steam generators (HRSG), which in turn supply supplemental steam to existing steam turbines and provide high pressure steam to the refinery.
Included in these new facilities is a new air separation unit (ASU) which supplies oxygen and other industrial gases required for these facilities and for debottlenecking the refinery’s existing sulphur plants. The plant is designed to use all the fluid petroleum coke generated at Motiva’s Delaware City Plant and produce 1250 psig steam, 175 psig steam for export to the refinery and 120 MW of electrical power.
There were several key drivers for this project. One of these was to utilise all of the refinery’s production of petroleum coke in order to eliminate the costly disposal of this high BTU waste fuel. Another was meeting the environmental regulations utilising the high sulphur petroleum coke and providing a highly reliable new source for high pressure steam. This allows the refinery to rely less heavily on less efficient existing boilers. A third driver was to provide additional flexibility and future diversity in the refinery, which would enable the refinery to enhance its economic profile.
The construction of the facilities started in April 1998 and was completed in stages with the air separation unit, supplied by Praxair, commissioned in November 1999 and restarted for commercial operation, producing nitrogen, oxygen and argon, in May 2000. The power block was commissioned in March 2000 on low sulphur diesel with introduction of syngas to Unit 1 in September 2000. The grinding/mill area was commissioned and started up in March 2000, and the gasification block commissioned in April/May 2000 and started up in July 2000.
The 240 MW power plant began operation on syngas in October 2000.
In the USA two major pet coke IGCCs with outputs in the range of 750 MW and a smaller 180 MWe unit for IOC Paradip are known to be on the point of final contract signing and there are said to three or four more in the pipeline this year.
TECO Power Services Corp (TPS) has just signed a memorandum of understanding with CITGO Petroleum Corporation granting TPS exclusive rights to develop an IGCC plant adjacent to CITGO’s Lake Charles, Lousiana, manufacturing complex.
The $1.2 billion project will use the Texaco gasification process to convert 5000 t/d of pet coke and excess refinery gases to clean syngas. Output will include 670 MWe plus steam and hydrogen for the complex.
New projects world-wide
The San Francisco Conference was opened with a keynote speech by James C. Houck, president of Texaco Power & Gasification who, not surprisingly, thought that the gasification industry world-wide had a very bright future indeed, not just within Texaco, but in the emerging global market place.
He quoted from the Gasification Technology Council’s studies, carried out by SFA for the US DOE, “there are currently 160 commercial gasification plants in operation, under construction or in planning and design stages in 28 countries around the world. The total capacity of these facilities when in operation will be just under 430 million m3 of synthesis gas per day, or the energy equivalent of more than three quarters of a million barrels of oil per day.
Looking at the SFA data presented by Gasification Technologies Council executive director James M. Childress, it might be considered surprising to see that of the predicted increase in capacity by 2005, the Europe/FSU sector of the globe is expected to account for the major proportion of this growth (see Figure 4). Earlier setbacks in Germany, Italy and Spain, and the virtual absence of any progress at all in the UK, might have suggested otherwise.
Texaco Gasification Process projects now seem to be proliferating around the world. Twelve new commercial TGP plants are being started up in the calendar year 2000, of which there are three in the U.S.A., two in China, two in Singapore, three in Italy, one in Germany and one in Australia. To this we must now add the massive PIEMSA 800 MWe visbroken tar IGCC in Spain.
With its obvious success in establishing its gasification technology Texaco has responded by greatly increasing its commitment to the business. We have mentioned the innovation in syngas marketing at Baytown, but Texaco has now “begun the transformation from mainly a licensor of the TGP to an equity owner and operator.” Texaco has been committed, even with the strictly licensed projects, to act like an owner for the purposes of the start-up of the recently commissioned plants.
Of the four original contenders for the subsidised gasification plants in Italy, the one that missed out was the San Nazzarro project, adjacent to Italy’s largest refinery half way between Milan and Genoa. Now ENI Energia is planning a massive gas fired combined cycle plant on the site which will have an output of 1000 MWe of which about 340 MWe will be from an IGCC plant using a Shell gasifier. This deal, apparently, has been negotiated directly with Shell and not Krupp Uhde, who now market the Shell licences for both the oil refinery residue and coal gasification systems.
The classic US DOE Clean Coal Programme Round IV plants at Wabash River and Polk Power Station have been building up good operating experience with high availability and profitable production for years. This is not to say that there have not been had the usual maintenance problems and outages that are typical with most chemical or power production plants, including gas turbine peripherals, but they are not hung up on significant systematic design failures are commercial plants are being ordered in substantial numbers.
Wabash River Energy Ltd. uses the old Destec oxygen blown technology, now known as E-Gas, for clean gasification of high sulphur bituminous coal or pet coke to repower PSI Energy’s adjacent combined cycle generating station in West Terre Haute, Indiana, giving 262 MWe of electricity.
It has been operating since 1995. During year 2000 the plant recorded no gasification technology related downtime and claims 85 per cent availability overall with 95 per cent availability on pet coke. Power block availability is up to 89.89 per cent despite suffering from HRSG tube failures. The longest unplanned outage this year was caused by the air separation unit.
The plant is now in the hands of Global Energy, who are also developing a refuse gasification power plant in Scotland. They have also taken over 100 per cent ownership of the SVZ and related gasification technology at Schwarze Pumpe in eastern Germany from Berlinwasser Holdings (BWH).
Global Energy finally completed the buyout Wabash River from Dynegy in December 1999, but operation under the original contract did not end until March 2000. The company then became another trader of syngas on the power generation fuels market. On 13 June 2000 Wabash River Energy Ltd entered into a contract with Cinergy’s PSI Energy Inc. for the sale of syngas to PSI’s neighbouring combined cycle plant and operation has resumed under the new, market based, agreement. According to John E. McDaniel’s presentation in San Francisco, the market based drivers for PSI Energy were:
Contract buy-out included gas turbine conversion.
Operation on natural gas would be for peaking.
Operation on syngas must be best economical choice.
And for Global Energy:
Maximise dispatch - base load.
Tampa Electric’s Polk Power plant has also been running for four years with excellent results in 2000 after real problems with syngas cooler plugging due to excessive carbonyl sulphide in 1999. The second largest loss of outage at 416 hours was due to gas turbine problems when switching from distillate fuel to syngas. GE have now come up with a fix for this. The turbine runs very well on syngas. Next year they expect to begin processing blends of coal and pet coke which will significantly reduce their fuel cost.
Tampa Electric are clearly happy with the plant’s performance; they are said to be seriously considering the addition of a further two similar plants on the same site to gasify mainly pet-coke.
Problems in Europe
Apart from the Shell Pernis gasification plant in the Netherlands and the odd installation that does not involve power generation, there is not much in the way of successful on-schedule commissioning experience to report, but there should be by the time this article is published. There should also be some good news about one or two more new contracts.
Sarlux (see photograph, page 37) and ISAB are the great white hopes, and hopefully Api Energia will also have got its act together by then in spite of the major change of status in the ABB organisation. Everyone is anxious to know how the gas turbines are performing on syngas. We know that the gas turbine has been run at base load on diluted syngas, the emissions were lower than expected, and both gasifiers have been operated at full output.
Demkolec has now built up a formidable record of operating experience, but there are rumours that this is now up for sale because it cannot now compete with French nuclear electricity prices in a deregulated Europe, which has a touch of irony considering what is happening with the Gonfreville refinery IGCC project in Normandy. The project apparently did not die because EDF considered the cost of the electricity to be too high. The project, which is another Texaco gasifier system, lives on with strongly emphasised endorsement from EDF Chairman and CEO Pierre Roussely, but with slightly modified parameters.
When the project was first conceived the plan was to commission and operate the electricity generating plant running on cheap HFO until the gasifier was commissioned a year or two later. Since then the price of HFO has rocketed and it is now planned to run the turbines initially on natural gas, as at Puertollano, and the design power output has been reduced from 365 MWe to 260 MWe.
Apparently the Mayor of Le Havre got wind of the cancellation rumour and protested, with the result that a letter from the EDF CEO strongly reaffirming the status of the project mysteriously found its way into the pages of the newspaper La Tribune. Prospects for IGCC economics in France seem, in any case, to be further affirmed by the new IGCC project running three GE 6F combined cycle units to be built at Dunkirk by Air Liquide.
The EU funded Puertollano project still seems to be struggling with a variety of problems, many of which are little more than what is expected of new process plant development. On the other hand it is clocking up substantial levels of electricity production, having generated some 3 290 000 MWh by June 2000. At that time its operating statistics were:
Number of gasification runs 151
Gasifier operation 3180h
Longest gasifier run 224 h
Hours of IGCC operation 2220 h
Gross generation with natural gas
2 730 000 MWh
Gross generation with syngas
560 000 MWh
Gasifier maximum load
106 per cent fuel feed weight
GT max load on nat. gas/syngas
ST max. load on nat gas/syngas
In August the plant recorded over 5000 hours of gasifier operation and the V94.3 gas turbines are working very well. There are continuing problems with syngas flow restriction, but the project has yielded a tremendous amount of valuable operating experience and learning curve progress from what is, after all, a demonstration plant.
ISAB and Sarlux perform
At the time of writing the ISAB plant was half way through its 30 day availability test which entails reaching an output of 512 MW NPO for 48 hours and an availability factor of 93 per cent. After a series of gasification plant adventures in 1999 the Texaco gasifier based system sailed through its guaranteed performance standard test in April 2000 without major problems. The plant will have completed its 30 day availability test by the time this article is published and results so far seem to bode well for the two specially developed Ansaldo/Siemens gas turbine combined cycle units, which have an additional stage in the compressor to deal with the process parameters. This turbine design has been unofficially branded the V94.2K.
The Sarlux IGCC has different process parameters to ISAB, but it has a very similar Texaco gasification system. The power generation plant in this case consists of two GE STAG 109E combined cycle units to generate some 551 MWe compared with 512 MWe for the ISAB plant.
So far, Sarlux commissioning seems to have proceeded more smoothly than the other plants in Italy. At the end of April 2000 the first gasifier started to produce syngas from high sulphur oil at 70 per cent load with soot recovery, WPT and sulphur removal on line in preparation to feed syngas to the gas turbine when trouble in the refinery forced a shut-down of the IGCC.
Operation resumed in July and syngas was first fed to the gas turbine to generate power on 13 August 2000. The second gasifier entered service on August 16, and the third on August 24. During the Sardinian summer in ambient temperatures of up to 35ºC one combined cycle unit reached 190 MW during the period and at least two of the units have been running well since then apart from the normal commissioning adjustments. The turbines had already been generating for over 7000 hours on distillate oil since commissioning.
For all the teething problems in Europe’s IGCCs we should not forget that the SVZ multifuel gasification system using Lurgi gasification at Schwarze Pumpe in eastern Germany, which will soon see the start-up of its BG slagging Lurgi system, has been performing remarkably well since 1996.
We should also remember the old Czech Sokolovska Uhelna lignite gasifiers which after decades of producing town gas for Vresova reverted to generating electricity in two GE 9171E combined cycle plants in 1996 and have been operating very well.
Plans to replace the ageing gasification plant with the more efficient German HTW technology of the abandoned Kobra programme have been on hold waiting for a decision on EU funding. In San Francisco, World Bank GEF programme manager Masaki Takahashi added new momentum to the project with the prospect of major incremental cost financing in support of global environmental benefits.