Petrol from natural gas could save $50m a year

Press, Volume CXVI, Issue 34152, 13 May 1976, Page 2

Petrol from natural gas could save $50m a year

(By

BARRY SIMPSON

NELSON, May 12. A process for converting natural gas into high-grade petrol has been discovered by Mobil scientists, and the world’s first production plant—in New Zealand—will be working about 1980.

News of this important development, which could save New Zealand about Ssom in overseas exchange each year, was announced by the Mobil company’s managing director (Mr Gordon Duncan) at a convention for Mobil dealers in Nelson today.

“This is indeed a scientific breakthrough of tremendous importance and is one that holds a great deal of potential for future large-scale petrol production.” said Mr Duncan.

Executives of the company said that the project had” been broadly discussed with the Government. Such details as the cost of gas, the siting of the plant, possible Government participation and many other points involving the Government, had yet to be discussed. They admitted, however, that motorists could not expect any reduction in the price of petrol produced through the process. Financial relief would be more to the country through savings in overseas exchange than to the motorist. Initially the company will concentrate on using the gas

from the Maui field, which will come into production about that time. For that reason, it appears very likely that the plant will be established in, or very close to, New Plymouth. Making the announcement, Mr Duncan said the naw technique was pioneered by scientists of Mobil’s research and development corporation.

He emphasised that he did not suggest it would make New Zealand completely independent of imports.

There were a number of reasons why New Zealand was chosen as the site for the new development. These included New Zealand’s total dependence (apart from small quantities of condensate from Kapuni, and from Maiii when it comes into production) on foreign crude oil and finished products. “Unless we do find a sizeable quantity of oil at some future date. New Zealand is not well placed to reduce its dependence on imported oil,” he said. "As methanol is derived principally from natural gas, or coal, the large Maui gas field could provide the feedstock for a methanol plant. “The current relatively high selling cost of petro-

leum in New Zealand makes the production of methanolderived gasoline a more economically viable proposition than it would be in countries like Australia and the United States, where petrol sells at well under $1 a gallon," he said. New catalyst The key to the process ■was Mobil’s recently developed zeolite catalyst. i “In the course of exploring the potential of this catalyst, our research people found that it could convert methanol into a mixture of hydrocarbons with the composition, octane number, boiling range, and other specifications of high-quality gasoline,” Mr Duncan said. Mobil believed a realistic target would be to replace projected gasoline-product imports by the methanol-to-gasoline process. Production of methanol-de-rived gasoline in 1980 would be about 112 million gallons a year, with annual savings in overseas funds of about $5O million, he said "The amount of gas to

[produce the methanol necessary to sustain this output would be less than 1 per cent per annum of the (known recoverable reserves lof the Maui field,” said Mr [Duncan. Company executives said (the capital costs for the construction of a methanol plant in New Zealand would be about sl4om, with another S6om for Mobil’s petrol conversion plant. Of major importance would be the price of this new fuel to the motorist. Mr Duncan said this wouid depend largely on the price the Government charged for natural gas, but he estimated that the cost of methanol-based petrol should make it competitive in cost with petrol produced from oil. Properties of methanol - based petrol were typical of high-quality petrol refined from crude oil, said Mr Duncan. The octane number, without lead, was 94. When using the same amount of lead booster as at present, the octane number rose to 101, which compared more than favourably with 96octane, premium grade petrol now being used. “In the United States a small pilot plant has been operating for many months and our people are satisfied there are no problems calling for further developmental work. They are now at the stage where it would be possible to proceed with a full-scale operation,” he said.