DOHA, QATAR — There’s something going on beneath the surface in the oil and gas business.
It involves fundamental, long-term demand destruction for Oklahoma tight oil exploration and, conversely, a much brighter future for the Sooner State’s shale gas industry.
Driven by the potential decline of the internal combustion engines and the electrification of the world’s vehicle fleet, oil demand could peak by 2026 and decline steadily.
In 2025, it will be impossible to buy a new car powered by an internal combustion engine in Norway. In 2030, Iceland, Ireland, Sweden, Denmark, Israel, British Columbia and the Netherlands will follow suit. Cities like Athens, Madrid, Mexico City and Paris will ban internal combustion cars by 2025.
Recently, Senate Minority Leader Chuck Schumer introduced a bill to provide incentives for car owners to switch to electric vehicles.
In a recent New York Times op/ed, he said his goal is that only zero-emission vehicles be on U.S. roads by 2040.
At the same time, China is also considering outlawing the internal combustion engine, while retiring its coal-fired generating plants and switching to natural gas. India has set a goal for 15% of primary energy demand to be powered by natural gas.
Led by South Korea and Japan, the number of liquefied natural gas-powered tanker and cruise ships is expected to double in the next five years, signaling a long-term decline in demand for heavy fuel oil.
Despite a period of negative returns for natural gas producers in west Texas this past summer, the medium- and long-term outlook for the export market for U.S. LNG looks promising. Already, the U.S. is the third largest exporter of LNG, behind Australia and Qatar.
Natural gas producers in Oklahoma could deliver clean fuel that reduces particulate emissions by 90% and NO2 emissions by 37% but it has historically been economically and environmentally impractical.
Dr. Nimir Elbashir’s work for Texas A&M University’s Qatar campus may change that.
Elbashir received a $5 million grant from the Qatar National Research Fund — part of the Qatar Foundation, one of the drivers of the Gulf country’s socioeconomic development — to explore ways of decarbonizing the gas-to-liquids process.
GTL fuels are nothing new. Royal Dutch Shell has been making it in Malaysia for 26 years but on a scale that is dwarfed by its Pearl GTL plant in Qatar and Sasol’s Oryx GTL facility. Qatar is the biggest producer of GTL fuels in the world, and a number of the 1,400-plus patents to refine the Fischer–Tropsch process have been developed through research at Texas A&M’s Qatar and College Station campuses, as well as the research lab Shell has established in the Qatar Science and Technology Park, also based at the Qatar Foundation’s Education City development in Doha.
In a lab on the ground floor of Texas A&M’s Qatar campus — one of six U.S. universities at Education City — Elbashir constructed a miniature version of the massive reactors that Shell uses as part of the GTL process and substituted carbon dioxide in the reformer instead of steam and oxygen. The process operated at a much lower temperature and lower energy demand level and had an unexpected byproduct: perfectly formed, double wall carbon nanotubes.
Carbon nanotubes are used to produce everything from computers to smartphones, and in industrial processes, like steel-making and the cement industry. They are so valuable they are usually measured in grams instead of kilograms.
“This discovery upends the economic model for GTL production in the U.S.,” Elbashir said. “Not only do we permanently sequester carbon dioxide in this process, which addresses environmental concerns, we have developed a byproduct that is even more valuable than the clean burning fuel that the GTL process produces.
“In the past, profitable GTL production required semi-free feedstock, like Sasol and Shell use from Qatar’s stranded gas field. Now that dynamic has been turned on its head.”
The importance of Elbashir’s project extends well beyond making the gas-to-liquids process more economically viable, it presents the possibility of making natural gas processing plants, such as the Blue Mountain Midstream plants in Oklahoma, very favorable in terms of their carbon footprint compared to all conventional fossil fuel sources.
Qatar produces 200,000 barrels of GTL fuel that produces negligible particulate pollution and greatly reduced NO2 emissions, which is about enough to provide clean fuel for a city the size of Phoenix. As a transition fuel for the world’s most polluted cities, it is the perfect bridge solution until the electric car becomes the world’s dominant vehicle.
Brian O’Connell is a journalist based in Doha, Qatar.