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The Nature of Bolivia’s Hydrocarbon Reserves

Within the last few years, sizable reserves of natural gas have been discovered in Bolivia. These newly discovered fields, which contain some 55 trillion cubic feet of gas, have been valued at more than $70 million USD and bring the country's total domestic reserves to the second largest in South America. These new gas fields are considered "remote" because they are located far from large established markets, and transportation of this gas involves difficult economic, political, and social challenges. In July 2004 Bolivian citizens voted to establish a multifaceted national energy policy to help direct exploitation of these natural gas reserves. This new policy for the "industrialization" of Bolivia’s gas has several objectives, but among its principal goals is the utilization of this resource to satisfy Bolivia’s currently unmet domestic needs. Yet another policy goal seeks to develop and export some fraction of this natural gas (and products derived from it) under favorable economic terms.

In contrast to its abundant natural gas reserves, Bolivia has only modest reserves of petroleum. In addition to its being in short supply, Bolivian crude oil is "superlight" and not well suited to production of heavier hydrocarbon fractions such as diesel, lubricants, and waxes. For these reasons, Bolivia currently imports these products.

In summary, Bolivia’s hydrocarbon problems are two-fold. First, the country suffers from a lack of petroleum suitable for the production of adequate quantities of heavier liquid hydrocarbons like diesel. And secondly, although Bolivia now enjoys significant reserves of natural gas, it lacks the means of transporting this gas to distant markets.

The Role of Gas-to-Liquids (GTL) Process Technology

A potentially attractive solution to Bolivia’s problems is to convert its natural gas to liquids that are more easily exported or better matched to its domestic needs. In principle, this could be accomplished either by cooling and condensing the gas to produce "liquefied natural gas" (LNG) -- or by chemically converting it to higher-molecular-weight hydrocarbons like diesel oil. The latter approach is particularly attractive from Bolivia’s perspective, because it addresses both domestic needs and export opportunities.

Several processes exist to convert natural gas to liquid hydrocarbons; most involve the following steps:


generation of synthesis gas or "syngas" – a mixture primarily of CO and H2 – from natural gas, usually by reforming;


catalytic conversion of this syngas mixture to a crude liquid product, usually by Fischer-Tropsch processing; and


upgrading of the resulting syncrude to finished products like diesel fuel -- for example, by hydroprocessing.

Several companies have recognized the opportunity to build large-scale GTL plants in Bolivia, and plans for projects as large as 90,000 barrels per day (bbl/day) have been drawn up.

In a recently completed Proyecto de Grado conducted under the direction of Professor Edwin Quiroga in the Department of Chemical Engineering at USFX, students Simeón Ovando and Gonzalo Vara analyzed Bolivia’s markets for liquid hydrocarbons – both current and future -- with a view towards determining the size of a single, large-scale GTL plant that would meet demand a decade from now. Their analysis considered both projected domestic consumption as well as potential export markets. Ovando and Vara concluded that a plant with a capacity to produce 75,000 bbl/day of liquid hydrocarbons (primarily diesel) from nearly 800 million standard cubic feet per day of natural gas would satisfy these needs, and they designed both the syngas and Fischer-Tropsch sections of a GTL plant of this size (1). Their design was based on production of syngas by traditional steam-methane reforming, followed by Fischer-Tropsch conversion to liquid products using an iron-based catalyst in a slurry-phase reactor (2).

The Rationale for Small-Scale Gas-to-Liquids Processing

Traditionally, GTL process technology has targeted very large-scale applications (e.g., capacities of 75,000 to 90,000 bbl/day in the studies cited above). This is because international markets for liquid hydrocarbons are large and because many of the unit operations involved in GTL processing (e.g., cryogenic oxygen production) benefit from improved efficiency when operated at large scale. That is, unit costs of production fall as plant capacity increases. Indeed, exploitation of economies of scale has been a dominant theme in the petroleum and chemical industries over the past half century. However, under special circumstances it may be desirable to design and construct much smaller GTL plants, and given new technology such plants may become competitive in the not-too-distant future.

Several factors tend to limit the optimum size of a GTL plant. Sometimes the factors are geographical, as when natural gas available in remote regions or even offshore would otherwise be flared; indeed, small-scale barge-mounted GTL plants are actively being pursued to develop this so-called "stranded" natural gas. In other cases, economic and social factors may determine the most favorable plant size; for example, investment capital may be limited, or environmental or safety issues may make it difficult to site a large plant. And finally, the accessible market for GTL products may be small in comparison with the size of a "traditional" GTL plant. Several of these factors pertain to Bolivia, where the domestic demand for diesel fuel is currently about 15,000 bbl/day (1).

Several hydrocarbon conversion technologies – for both the syngas generation and gas-to-liquid conversion steps -- have been developed in recent years that show promise for operating competitively on a scale much smaller than that for which most steam-methane reformers and Fischer-Tropsch plants have typically been designed. The more innovative technologies are in early stages of development and hence are rather speculative; these include, for instance, processes based on cracking of methane to an acetylene GTL intermediate (3), and ion-transport ceramic membrane reactors (4). However, still other GTL processes with potential for smaller-scale operation are less revolutionary and more promising in the short term.

The Project: Diesel from Natural Gas by Fischer-Tropsch Using Nitrogen-Rich Syngas

In recent years, Hedden, Jess, and their coworkers have proposed a novel concept for producing liquid hydrocarbons from natural gas (5-10). Rather than advocating the construction of very efficient but capital-intensive GTL plants designed to minimize energy and material costs, these investigators suggest that relatively low-cost (albeit somewhat less efficient) GTL plants be designed for situations where natural gas is far from large markets and relatively inexpensive and abundant as compared to investment capital. The GTL process that Hedden, Jess, and coworkers design and describe in considerable detail in their series of papers involves the following operations:


generation of syngas by catalytic partial oxidation of methane over a nickel catalyst using air rather than oxygen (thus avoiding a costly air separation plant that would operate efficiently only at large scale);


conversion of nitrogen-rich syngas to liquid in a two-stage Fischer-Tropsch unit consisting of multi-tubular fixed-bed reactors containing an iron catalyst; and


recovery of products – namely, gasoline, diesel, and waxes.

This simple process concept may have some potentially interesting advantages.

Hedden, Jess, et al. focus on the trade-off between investment cost and operating efficiency, and they identify circumstances where less efficient but less costly GTL plants will be more appropriate than more efficient but more costly plants. We go one step further and suggest that smaller-scale GTL plants based on the above design concept may be especially attractive in Bolivia, where both the size of the domestic market and the availability of investment capital are limited. Furthermore, certain features of the Hedden/Jess GTL process – for instance, its lack of a cryogenic air separation plant, the absence of syngas recycle, and the improved temperature control and less expensive reactor configuration made possible by the presence of heat-absorbing nitrogen gas in the Fischer-Tropsch reactor – suggest that this process may operate relatively efficiently at small plant capacities.

In the Proyecto de Grado proposed here, the student will determine the size and location of a relatively small-scale GTL plant (perhaps 10,000-25,000 bbl/day?) designed to meet Bolivia’s domestic needs for diesel oil; this effort will be based largely on the market study performed by Ovando and Vara (1). The student will then develop a detailed flow sheet as well as heat and mass balances for a GTL plant of this size based on the process concept of Hedden, Jess, and their colleagues. At minimum, the student will design plant and equipment for the first section of this GTL facility – namely, the air-blown catalytic partial oxidation unit. Ideally, but only if time permits, the student will also extend the work to include the Fischer-Tropsch section of the plant. A preliminary economic analysis will also be performed in order to permit comparison of the large-scale and more traditional GTL process investigated by Ovando and Vara (1-2) with the smaller-scale process alternative explored here. It is hoped that this will provide insights regarding the type and scale of GTL plant that is more "appropriate" to Bolivia’s circumstances.

References Cited:

1. Ovando Gonzáles Simeón and Vara A. Gonzalo, "Obtencion de Gas de Sintesis y Petróleo Sintético por el Método Fischer-Tropsch a Escala Convencional," Proyecto de Grado (1º Presentación), USFX, Sucre, Bolivia, 15 de Abril, 2004.

2. Ovando Gonzáles Simeón and Vara A. Gonzalo, "Obtencion de Gas de Sintesis y Petróleo Sintético por el Método Fischer-Tropsch a Escala Convencional," Proyecto de Grado (2º Presentación), USFX, Sucre, Bolivia, 24 de Mayo, 2004.

3. "Industry Trends", Oil & Gas Journal, pg. 7, Sept. 2, 2002; "From Natural Gas to a Gasoline Source," Chemical Engineering Progress, p. 15, Nov., 2002;

4. A.C. Vosloo, "Fischer-Tropsch: a futuristic view," Fuel Processing Technology, 71, 149-155 (2001); J.R. Rostrup-Nielsen, "Syngas in perspective," Catalysis Today, 71, 243-247 (2002).

5. K. Hedden, A. Jess, and T. Kuntze, "A New Concept for the Production of Liquid Hydrocarbons from Natural Gas in Remote Areas," OIL GAS European Magazine, 20(3), 42-44 (1994).

6. A. Jess and K. Hedden, "Production of Synthesis Gas by Catalytic Partial Oxidation of Methane with Air," OIL GAS European Magazine, 20(4), 23-27 (1994).

7. T. Kuntze, K. Hedden, and A. Jess, "Kinetics of the Fischer-Tropsch Synthesis Using a Nitrogen-Rich Synthesis Gas," OIL GAS European Magazine, 21(1), 19-24 (1995).

8. A. Jess, R. Popp, and K. Hedden, "Production of Diesel Oil and Wax by Fischer-Tropsch Synthesis Using a Nitrogen-Rich Synthesis Gas – Investigations on a Semi-Technical Scale," OIL GAS European Magazine, 24(2), 34-43 (1998).

9. A. Jess, R. Popp, and K. Hedden, "Fischer-Tropsch synthesis with nitrogen-rich syngas – Fundamentals and reactor design aspects," Applied Catalysis A: General, 186, 321-342 (1999).

10. A. Jess, K. Hedden, and R. Popp, "Diesel Oil from Natural Gas by Fischer-Tropsch Synthesis Using Nitrogen-Rich Syngas," Chemical Engineering Technology, 24, 27-31 (2001).




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This page was last updated on January 04, 2009.