Inside Shell's Bintulu Gas-to-Liquids Plant
Bintulu. For many people involved with gasification, that word often invokes a specific image. In fact, colleagues know when I say “Bintulu” that’s shorthand for Shell’s Bintulu, Malaysia gas-to-liquids (GTL) facility (officially, the Shell Middle Distillate Synthesis plant).
I recently traveled to Malaysia on business, and I learned that I would be in Bintulu (the airport code for Bintulu, by the way, is BTU) for two days. I contacted Shell to see if they could accommodate a visit for the purpose of writing a story about their facility, and they were indeed able to get me into the plant.
I met my hosts, Mark Pattenden (General Manager, Manufacturing), Joseph Balan (Advisor, Media Relations and Corporate Communications), and Khaty Rapaie (Communications Executive) for breakfast. I then rode to the plant with Mr. Pattenden, a transplanted Kiwi in the middle of a transfer to Houston. As we drove up to the facility, I was reminded of a fortress. There is an enormous berm out front next to the security station, and you can’t see much of what is behind it. I was later told that this wasn’t really by design; that the facility was built out of rock and that berm was just a part of the original rock.
One of the things I am always interested in is a company’s safety culture. There are many hazards inherent in handling flammable or explosive materials, especially when they are subjected to high temperatures and pressures. We read of explosions, fires, and casualties every year in the oil and gas industry. You will find some companies in the news more than others, and one reason for that is that not all companies put the same real emphasis on safety.
In my experience, Shell has had a good reputation as a company that values personal safety and process safety (making sure those flammable materials stay in the pipes and tanks). But I have seen companies that applied their safety standards differently when operating in the West versus the East. So I was especially curious about this aspect.
As we entered Mr. Pattenden’s office, the first thing he did was brief us on the safety procedures in case of an emergency. Following the briefing on the response to an emergency, Mr. Pattenden added “And be sure to keep your hands on the handrails; quite a few people are hurt each year falling on stairs.” I consider myself someone who values safety at a very high level, and I could see the same sort of attitude in Mr. Pattenden.
When we sat down in the office to review the plant and its history, you could see the results of a real safety culture. Until March 2010, they had gone nearly 3 years and 5.7 million hours without a lost time injury. (Until June 2006 they had a streak of 14 million hours without a lost-time-injury). Early in my career I worked in plants where we would have a lost time injury every month or so, so this is definitely a feat worth mentioning.
History, Facts and the GTL Process
Following the safety briefing, we had a discussion about the plant’s history. Shell’s Bintulu facility is the largest GTL facility in the world[*] at 14,700 barrels of products per day, but will soon be dwarfed by their 140,000 barrel per day Pearl GTL facility in Qatar.
The plant is actually a venture composed of four shareholders: Shell (72%), Mitsubishi (14%), Petronas, the national oil company of Malaysia (7%), and Sarawak State (7%).
The plant was originally completed in 1993 with a capacity of 12,500 bbl/day at a cost of $850 million. That is a capital cost of $68,000 per daily barrel, more expensive than a conventional oil refinery but far less than the costs often cited for coal-to-liquids (CTL), biomass-to-liquids (BTL), or any number of alternative fuel technologies. The plant has since expanded to the present capacity of 14,700 bbl/day and the total investment is over $1 billion.
Production was interrupted for two years starting in 1997, when particulate matter from forest fires in the area caused an explosion in the air separation unit. However, they used the downtime to also increase the plant capacity from the initial 12,500 bbl/day to the present capacity of 14,700 bbl/day. Other than this extended outage, plant reliability has been excellent. The numbers I was given for 2001 to 2009 were mostly over 98%.
Plant staff consists of 380 people, 93% of whom are Malaysian, with 80% from Sarawak state. The plant consists of a number of separate units, including units for air separation (to provide oxygen for the gasifier), the gasification unit (I explain gasification in some detail here, and describe the different versions of distillate substitutes here), a synthesis unit where the Fischer-Tropsch reaction takes place, a separation unit where the products of the FT reaction are separated, and a conversion unit. The plant also makes hydrogen for use in the hydrocracking reaction (to break the long-chain waxes into shorter hydrocarbons) and has a wastewater treatment facility that produces water that I was told was clean enough to drink. Primary products of the reaction include chemicals, waxes, naphtha, kerosene, and gasoil.
Efficiency, Product Distribution, Future Plans and Scalability
Plant efficiency has improved over time. In 2001, the facility needed just over 106 million BTUs (MMBTU) of natural gas to produce a metric ton of product, and by 2004 that had fallen to 92 million BTUs. According to my calculations, that means that in 2001 39% of the BTUs in the natural gas ended up in the product, and by 2004 that percentage was up to 45%. I was told that design changes to the upcoming Pearl facility would increase the efficiency of production even further.
The site itself is 100% devoted to the GTL process. Shell sells their GTL products to 46 different countries, but most of the deliveries are within Asia. Perhaps surprisingly, only 40% of the products are fuels; the other 60% are specialty chemicals and waxes. GTL products have certain advantages over the same products made from petrochemical feedstocks; namely that there is virtually no sulfur or aromatics in the product. This results in a colorless, odorless, and clean-burning product. (I have actually seen people drink fuel produced by a GTL process to show that it is non-toxic, but I wouldn’t recommend doing it).
Some of the product from the Bintulu plant is shipped to Europe and Thailand and is used to produce Shell’s V-Power Diesel. Their waxes are sold for use in a wide variety of products, from hot melt adhesives, printing inks, and matchsticks to crayons and candles.
I asked about the scalability of the technology, and was told that the main limitation is the physical size of the reactors and being able to transport them. Their biggest challenges, I was told, were: (1) maintaining the focus on personal and process safety; and (2) competition for talent. The plant is presently undergoing an $85 million project that will double the overall solid wax production from the plant while leaving the overall gas throughput the same. The profitability of the plant has been good; due to the unique properties of GTL liquids and waxes, they do command premium pricing.
After the discussion in Mr. Pattenden’s office, we took a drive around the plant. As soon as we all were in the vehicle, Mr. Pattenden checked to make sure we were all buckled up. Other than moss growing on some pipes (someone joked that if you leave your car parked for a week in one location, it will grow moss in that climate), the plant was very clean. There was a lot of construction activity going on around the new wax plant. I was looking for safety hazards as we drove around, but I didn’t see anything obvious. As we traveled around the facility, I saw familiar slogans about safety. I asked about their emergency response; whether they had to call the local fire department in case of a fire. They indicated that they have very sophisticated emergency response capabilities. They even have their own fire training ground for the emergency response team.
Back in Mr. Pattenden’s office, we finished up with a few questions. One of the things I asked was why the plant hadn’t been expanded more, given the obvious profitability. I was told that the company was expanding GTL, but in Qatar. However, there was also mention that they design equipment to last for 20 years, so perhaps there is uncertainty about gas supplies or prices that far out.
When people ask me about alternative fuels, I often steer them toward gasification as a possible solution in certain situations. For years, I have pointed to Shell’s GTL plant in Bintulu and Sasol’s CTL facilities in South Africa as examples of the scalability and workability of the technology. There are many technologies out there that are speculative; i.e., they have worked at small scale in the lab, and people envision scaling them up to thousands of barrels per day. But gasification has already demonstrated that it can operate at those scales. For this reason, I expect gasification to assume an important role in mitigating declining oil supplies.
In fact, I think that role that many envision for cellulosic ethanol — supplying a respectable amount of fuel from biomass — can actually be filled by gasification followed by the Fischer Tropsch reaction. It was a pleasure for me to finally see firsthand this example I have used so often, and I want to extend my thanks to Shell for allowing me to visit.
*A representative from PetroSA in South Africa has since contacted me and offered up the following clarifications:
The PetroSA GTL plant in Mossel Bay, South Africa; previously called Mossgas was the first commercial GTL plant commissioned in the world (1992) and was the largest until the Oryx plant in Qatar was commissioned in 2007. The PetroSA GTL capacity is 22,000 bbl/day from Gas and produces another 14,000 bbl/day from associated condensate.