[JohnDenver]

Oil traditionally comes gushing out of the ground from miles around in liquid form. In fact, we have to cap it off, so it stops flowing.

No matter what we decide to smash into liquid fuel, it won't be in the same ballpark as oil. Or on the same team... Or even the same sport...

Right now, I believe the #1 contender among synthetic oils is gas-to-liquids(GTL).

Lynch has an interesting presentation(pdf) talking about GTL and other unconventional oils.

Unlike thermal depolymerization and coal liquefaction, people are putting down serious money for large-scale projects:
"Shell signed a contract with Qatar Petroleum in October 2003 for a 140,000-bbl/d GTL facility to be built at Ras Laffan. The first 70,000 bbl/d of capacity is expected to commence operation by 2009, with the rest in 2010 or 2011. If completed, it will be the world's largest GTL plant."
http://www.eia.doe.gov/emeu/cabs/qatar.html

Qatar seems to be the center of this activity:

"We plan to spend six billion dollars on a major GTL plant in Qatar," Shell CEO Jeroen van der Veer told a Business Week conference in Paris, but gave no timeframe.
Shell signed a $5 billion deal in October last year with Qatar Petroleum to build a 140,000 barrels per day gas-to-liquids (GTL) plant, due to start in two stages with the first onstream in 2008-2009 and the second two years later.
Van der Veer added that by 2015 GTLs could meet three percent of world diesel demand.
GTL plants process natural gas into products such as diesel. Europe is short of diesel as oil refiners lack sufficient production capacity and demand is rising.
Qatar has racked up over $20 billion in GTL deals, as it seeks to cash in on its huge gas reserves.
Source

The following is a revealing quote which shows you why GTL is going to happen before coal-to-liquids. Sasol, the world's leading coal-liquefier, prefers natural gas:

Under the belief that partially replacing coal with natural gas as the synthetic-fuel feedstock would reduce investment expenditures in coal mining operations, Sasol began importing gas from Mozambique in 2004.

http://www.eia.doe.gov/emeu/cabs/safrica.html

As for Aaron's objection: Natural gas traditionally comes gushing out of the ground from miles around in gaseous form. In fact, we have to cap it off, so it stops flowing.

Of course, Aaron will point out the tremendously complex refinery apparatus which is necessary to turn natural gas into diesel and gasoline. I will rebut by pointing out the tremendously complex refinery apparatus which is necessary to turn crude oil into diesel and gasoline.

Also, it is no more expensive per btu than oil. In fact, in many places it is worth nothing, and is simply flared.

[Devil]

Long live climate change: this is the way to promote it!

[MonteQuest]

Long live climate change: this is the way to promote it!

Yes, our success or failure in tackling climate change depends on just one thing: how much fossil fuel we leave in the ground and don't burn.

[0mar]

GTL looks to be very powerful in supplemanting oil production. If natural gas reserves are as large as believed (excluding hydrates), there should be no problem in doing GTL plants.

Climate change is just about the only deterrant I can think of. Becase NG is often flared off in oil wells and because of the fact that NG is difficult to transport, compared to oil, I see a fairly substantial future for GTL.

[Sparaxis]

There's a good overview of the GTL market in a recent Oil & Gas Journal article. (Though their long term forecasts of gas demand seem to ignore a global gas peak. GTLs is yet another response that just further locks us into another depletable hydrocarbon.)

It will undoubtedly continue to grow since the economics are favorable.

Using natural gas as a feedstock, particularly if it is diverted from flaring, results in fewer CO2 (and equivalent) emissions than using coal as a feedstock.

An interesting side-story to Shell's push into Qatari GTLs: commercialization of gas in this manner allows them to declare the gas reserves as "oil equivalent", thus making their apparent "oil equivalent reserves" appear larger than just those of conventional petroleum.

[Aaron]

As for Aaron's objection: Natural gas traditionally comes gushing out of the ground from miles around in gaseous form. In fact, we have to cap it off, so it stops flowing.

Of course, Aaron will point out the tremendously complex refinery apparatus which is necessary to turn natural gas into diesel and gasoline. I will rebut by pointing out the tremendously complex refinery apparatus which is necessary to turn crude oil into diesel and gasoline.

Also, it is no more expensive per btu than oil. In fact, in many places it is worth nothing, and is simply flared.

But we already have the oil processing facilities...

But of course we will build these new plants.. we'll end up burning everything that can be burned in our mad dash into hydrocarbon hell.

The problem with Nat Gas is... it's a gas... not a liquid.

So of course it's more expensive to process into a liquid form.

The first 70,000 bbl/d of capacity is expected to commence operation by 2009, with the rest in 2010 or 2011

70,000 bbl/d ? lol

More gigawatt solutions in a terawatt world...

[MicroHydro]

Right now, I believe the #1 contender among synthetic oils is gas-to-liquids(GTL).

That does it, welcome to my Ignore list.

[jtmorgan61]

Right now, I believe the #1 contender among synthetic oils is gas-to-liquids(GTL).

The Hirsch report was guessing 1 mbd from GTL in 2015. (Any idea why he guessed so low and focused on coal to oil? I *don't* mean for that to be a rhetorical question. I'm genuinely wondering when it seems like GTL is cheaper.)

Under the belief that partially replacing coal with natural gas as the synthetic-fuel feedstock would reduce investment expenditures in coal mining operations, Sasol began importing gas from Mozambique in 2004.

I wonder whether gas would still be cheaper than coal in the US, where we have lots of cheap coal and gas prices have recently tripled or whatnot.

[0mar]

Right now, I believe the #1 contender among synthetic oils is gas-to-liquids(GTL).

That does it, welcome to my Ignore list.

?????

[JohnDenver]

70,000 bbl/d ? lol
More gigawatt solutions in a terawatt world...

It's actually better than that. Output is expected to reach 140,000bbl/day by 2011. Also, this plant will be producing finished diesel, not crude oil, and diesel only accounts for about 15% of a barrel of crude oil. Which means the plant will be providing as much diesel as an ordinary crude source producing 930,000bbl/day. That's huge. The Shell GTL project will produce 4 times as much diesel per day as Thunderhorse.

[0mar]

GTL has a large potential simply because natural gas has such a potential resource base. While I don't think it'll help much in the long term, it could mitigate some peak oil effects in regional areas.

[sicophiliac]

Ok a couple of things.. First of all isnt natural gas set to reach peak production with in a decade or so after oil peaks? Also why would this be much more favorable to coal conversion into oil ? Coal all though probably a much more difficult medium to start with is much much more abundant than natural gas. We have no shortage of coal or any sort of forseeable shortage anytime soon. I beleive there are the equivelent to 4.6 trillion barrels of oil in the worlds known coal reserves.

[Cyrus]

GTL has a large potential simply because natural gas has such a potential resource base. While I don't think it'll help much in the long term, it could mitigate some peak oil effects in regional areas.

Ok a couple of things.. First of all isnt natural gas set to reach peak production with in a decade or so after oil peaks? Also why would this be much more favorable to coal conversion into oil ? Coal all though probably a much more difficult medium to start with is much much more abundant than natural gas. We have no shortage of coal or any sort of forseeable shortage anytime soon. I beleive there are the equivelent to 4.6 trillion barrels of oil in the worlds known coal reserves.

Sure, peak oil will be put off; but runnaway climate change will be the result. Take your pick..

[JohnDenver]

The Shell GTL project will produce 4 times as much diesel per day as Thunderhorse.

Or half the diesel production of Cantarell at its peak. It's no spit in the bucket.

[Sparaxis]

diesel only accounts for about 15% of a barrel of crude oil. Which means the plant will be providing as much diesel as an ordinary crude source producing 930,000bbl/day. That's huge. The Shell GTL project will produce 4 times as much diesel per day as Thunderhorse.

It's not appropriate to compare a straight-through yield of some crude for diesel to what refineries today can produce. Even China, which doesn't have as sophisticated a refining sector as the US, produces 30% diesel as a final product. It's the refining capabilities that matter, not the primary distillation yield of diesel (which varies enormously from crude to crude).

GTLs serve a market niche and will be around as long as natural gas is cheaper than oil. It's not that big of a deal in the long run.

[Devil]

Using natural gas as a feedstock, particularly if it is diverted from flaring, results in fewer CO2 (and equivalent) emissions than using coal as a feedstock.

This would be true ONLY if NG were 100% contained, even during drilling. NG is a MAJOR contributor to climate change. Do you realise that CO2 levels have increased by only about 35% over the past 50 years, while methane levels have more than doubled in the same period. A large proportion of this is due to the exploitation of NG which is much worse than CO2 as a greenhouse gas. See http://www.cypenv.org/world/Files/methane.htm

[Antimatter]

Jean Laherrere reckons natural gas will peak about 2030, broadly in agreement with the USGS for conventional gas (!!). Unconventional resources (CBM, tight lithologies and shale/basin centred gas) are quite substantial and unlike unconventional oil can be produced quite easily. There is also huge amounts of methane in geopressurised brine but like hydrates, this is somewhat elusive and will probably amount to very little.

[sicophiliac]

I say we worry about climate change later VS peak oil now. If mankind can get through peak oil and still keep technological progress moving its not hard to imagine us building lots of CO2 scrubbers or maybe giant solar reflectors to regulate the earths temperature. Maybe this is just being a bit to optomistic but eh.. if were talking decades or centuries out who knows what'll happen. Back to my other point... why no talk about converting coal to oil ? Coal is plentifull and oil is in need.. whats the catch to this technology ?

[Sparaxis]

whats the catch to this technology ?

Its EROEI is less than 1 in most applications and barely positive in the best, so it provides nothing but a stopgap measure with lots of pollution side-effects.