Methanol Produced from Shale Gas: Is It Economically Viable?

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Shale gas is trapped into rocks. Photo by Sarablu7.

Shale gas is trapped in rocks. Photo by Sarablu7.

Researchers from Texas A & M University simulated the conversion of shale gas into methanol, a chemical compound that is commonly used in many industrial processes, and normally obtained from natural gas.

Their results showed that the process is economically viable, as it has favorable Return on Investment (ROI) for a broad range of methanol and shale gas prices.

What Is Shale Gas?

The term “shale gas” generally refers to natural gas fields which are less accessible than conventional ones. In fact, the gas is trapped in shale, a sedimentary rock made of particles of clay rocks.

Because of the low permeability of shale, the extraction of the gas is more difficult, and hence, expensive. Recently,

however, there have been substantial developments in drilling techniques; hydraulic fracturing (or fracking), in particular, is a new technology which allows the gas to flow out of the ground despite the shale’s low permeability.

Shale Gas Importance

The use of shale gas as a natural gas source has become more and more important. According to the Energy Information Administration, in the US, shale gas production increased almost ten times in the 2007-2012 period. Moreover, figures predict that within two decades shale gas will be the main US source of natural gas.

This is due to a higher gas demand, which led (and will continue to lead) to the use of alternative gas sources.

Like natural gas, the main component of shale gas is methane (CH4); other hydrocarbon compounds with longer carbon chains are present also as minor components. Similarly to natural gas, shale gas can be used for energy generation with a combustion process, but also for the chemical synthesis of other important chemical compounds.

Methanol is the simplest alcohol molecule. Photo by Cacycle.

Methanol is the simplest alcohol molecule. Photo by Cacycle.

Methanol Production

Methanol (CH3OH) is an alcohol, the one with the lowest molecular weight. CH3OH is a very important molecule, as it is used as a reagent in the chemical synthesis of many industrial products .

Generally, methanol is prepared by reaction of a mixture of carbon oxides (CO and CO2) with hydrogen; the CO/CO2 mixture, in turn, derives from CH4 generally obtained by natural gas.

Using Methane from Shale Gas

In principle, methanol could be produced using methane from shale gas, according to the same chemical reaction. It is important, however, to assess whether the process would be economically viable, as the extraction cost of methane from shale gas may be higher.

Researchers from Texas A & M University (US) performed an interesting study on this topic; their results were published in ACS Sustainable Chemistry and Engineering on the 4th of September 2014.

Simulation Study

Decoded Science spoke to Professor Mahmoud El-Halwagi, leading scientist in this research. Professor El-Halwagi explained his research as follows:

“What we did was a simulation of the process to obtain CH3OH from shale gas; this can be divided into two major sub-processes: the separation of the methane from the shale gas, and its conversion to methanol. Both sub-processes include several steps (purifications, chemical reactions, heating, cooling, etc.).

We calculated the costs associated with each step and, consequently, the cost of the whole process.”

In their simulation, Prof. El-Halwagi and his co-workers assumed the shale gas composition of the Barnett Shale Play, one of the most important reserves in the US, located in Texas.

Return On Investment (ROI)

Once the costs were assessed, the attention was focused on the possible profits of the process.

“We estimated the profit considering the Return on Investment (ROI), which is given by the ratio of the annual after-tax profit to the capital of investment.

We performed different simulations, considering several variables which could affect the profit; these include the market price of methanol, the plant capacity and the price of the shale gas. In most cases, the ROI values are favorable; this means that the process is economically viable.

Just to give an example, selling the methanol at 2 $/gal, with a shale gas price of 3.50 $/kSCF, we have an ROI of 31 %.”

Shale Gas and Methanol: Worth The Investment?

According to Professor El-Halwagi:

“This is the first study which analyzed the conversion of shale gas into methanol through computer-aided simulation and process integration for the effective usage of mass and energy.

Our preliminary results indicate that the process is economically attractive for a broad range of methanol selling prices and shale gas costs. This means that, from an economic perspective, shale gas can be considered a viable alternative to conventional natural gas. This is very important, considering the significant growth in shale gas production.”

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