InterviewMethane price volatility poses challenge to US GTL projects

06 March 2012 17:13  [Source: ICIS news]

HOUSTON (ICIS)--A gas-to-liquids (GTL) project in the US would have to contend with volatile methane prices, challenging the viability of such a capital-intensive plant, an executive for US-based Chevron Phillips Chemical said on Tuesday.

Fixed methane costs are the key to making a GTL plant viable, said Mark Lashier, executive vice president, olefins and polyolefins, for the US-based petrochemicals producer.

He spoke on the sidelines of the CERAWeek energy conference.

The US lacks such fixed prices, which would pose an obstacle to a GTL project, he said.

"You need long-termed fixed prices," he said.

The advent of shale gas in North America has increased supplies of light petrochemical feedstocks. As a result, several companies ­– including Chevron Phillips ­– plan to build plants that can take advantage of this cheaper source of feedstocks.

However, the new plants will rely on ethane, propane or butane feedstock.

No company plans to build a GTL plant, which would use methane as a feedstock, although Sasol is studying the feasibility of such a project.

CERAWeek ends on Friday.

By: Al Greenwood
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