IMTOF 2023

CONFERENCE REPORT

IMTOF 2023

The International Methanol Technology Operators Forum (IMTOF) met at the Leonardo Royal St Paul’s hotel in London from June 11th-14th.

Left: St. Paul’s Cathedral, one of the landmarks surrounding IMTOF 2023.

PHOTO: WIRESTOCK/ISTOCKPHOTO.COM

As a biannual conference, this was the first time that IMTOF had been able to meet face to face since the covid pandemic, as the 2021 meeting was unable to go ahead. A surprising amount seems to have changed since then, with the pandemic, war, inflation and increasing pressure to decarbonise operations all turning old certainties on their heads.

Methanol markets

Mark Berggren of consultants MMSA gave an overview of the methanol market. He noted the way that the world has been turned upside down over the past few years, and noted that, in a sense, the likely closure of coal-based methanol capacity is a major opportunity for improvement in the carbon intensity of methanol production, and prices and margins should support reinvestment. Mark forecast that typical methanol prices of $315-350/t today could be $410-460/t by 2028. Over that period, demand is forecast to grow by 22.7 million t/a, mainly in China. This is more than capacity is likely to increase, so operating rates should improve. However, 2022 was the first year for decades that methanol demand fell, due to a post-pandemic slowdown in China and loss of MTO demand. Europe also saw demand destruction due to the Ukraine war and effects on natural gas pricing. That region is now a ‘battleground’ for overseas methanol suppliers, and has typically been the first choice for US exporters. Meanwhile, Asia ex-China is the fastest growing region for methanol demand outside China, with biodiesel growth in Indonesia and Indian growth driven by chemical end-uses.

On the supply side, North America is increasingly a net exporter, and offers the best case for new capacity development over the next 4-5 years, including the Methanex Geismar 3 project and another 120,000 t/a at Fairway in 2024. The Middle East remains static as an exporter. New capacity in Iran has been limited by gas availability and high feedstock prices. Overall, 2023 represents something of a low point in industry operating rates, and these will need to increase as demand outstrips supply. New capacity could well be in China unless someone else steps up. As it is, the methanol price floor is set by the coal price, and the price ceiling by the marginal consumers, which are Chinese MTO plants. Coal prices in China are high and this has driven up pricing and led to some demand destruction. MTO capacity integrated with methanol production typically has much better operating rates than those depending on merchant market supply. China is still the main methanol importer, to the tune of around 12 million t/a.

Looking forward, there is the ongoing development of methanol as a marine fuel. However, in well to wheel carbon emission terms, gas-based methanol is still higher than very low sulphur fuel oil (VLSFO) and will need carbon capture or an e-methanol component to compete as a lower carbon fuel source.

Greg Dolan of the Methanol Institute said that the most recent trend in membership of the organisation has been companies involved in methanol shipping and green methanol production. The MI has completed a recent report with IREMA which suggests that the current methanol market of 85 million t/a could achieve 500% growth by 2050. There is still room for gas-based capacity out that far, but new capacity is and will increasingly becoming blue and green. Around 90 renewable methanol projects have already been announced, and while not all will come to fruition, this could represent 8 million t/a by 2027 of fairly firmly predicted capacity. Scale of green plants is increasing from 4-10,000 t/a to 50,100 or even 250,000 t/a, and development is moving from independent developers to major utility companies, and there is now interest from oil and gas majors. Much of the anticipated demand will come from the marine sector. Maersk’s order of 19 large (16,000 TEU) methanol powered container ships in 2021 was a game changer in that regard, Greg said, representing 600,000 t/a of methanol demand. Maersk has been looking to strategic partnerships with biomethanol producers, and has already secured agreements for 800,000 t/a of supply. If it converted 25% of its fleet to methanol use, that would represent 6 million t/a of low carbon methanol demand by 2030. Methanol powered ships dominate the container fleet order book (around 62%), edging out LNG and fuel oil. Fuel injection systems can be retrofitted to existing engines, and engine development is largely complete. According to DNV, there were 26 methanol powered ships in 2023, but by 2028 this will be 128. ON an energy equivalent basis methanol is already cost competitive with LNG and VLSFO. It is also easily bunkered. On the road, Geely have sold 28,000 M100 cars in China and have introduced a methanol hybrid cars. They expect to supply 50,000 methanol trucks by 2026. China’s road vehicles already consume 6.8 million t/a of methanol, as well as another 1.0 million t/a for cooking stoves. In that sense, Greg said, methanol is several years ahead of ammonia, another candidate for low carbon marine fuel, and has far fewer issues with safe handling and toxicity.

There was also an update by Lars Anderson of JM on the formaldehyde market, still one of the key derivatives for methanol. Estimated annual growth rates are still 3.0-3.5% year on year out to 2031, with China continuing to be responsible for half of global demand.

Methanol projects

Paul Bailey of Methanex described work on the Geismar 3 methanol project. Mechanical completion was achieved in early 2023, and electrical works to wire up the various components are now ongoing. There has been a strong focus on safety, with no lost time incidents in over 6.5 million work hours. The plant uses a JM autothermal reforming process. The feed is a hydrogen rich purge gas from Geismar plants 1 and 2, making it a kind of ‘cheap combined reformer’ setup, and the lowest carbon methanol currently available in North America.

Around 65% of global mega-projects tended to have overruns in either cost or schedule or both, he said. Geismar has had to deal with the covid pandemic, but forethought in the contracting structure allowed more flexibility to pause operations than would have been available with a lump sum turnkey contract. The project restarted in September 2021, and while it is obviously late due to covid, it is still trending to come in on-budget. Key to this has been good relations with contractors.

Michael Macdonald of HIF (Highly Innovative Fuels) gave an update on the various low carbon projects that his company is now working on. The company’s original project was in Chile, aiming to monetise wind energy in the Punta Arenas region – a very windy part of Chile, where the turbines have a 75% uptime. But there are also projects in the US now, since the incentives in the Inflation Reduction Act have kickstarted many renewable projects. HIF is also developing facilities in Uruguay and Tasmania.

The Haru Oni demonstration plant in Chile began operation in December 2022 using JM methanol technology. Porsche has been a large investor and the plant converts methanol to gasoline as a drop in replacement fuel for fossil fuel gasoline which is carbon neutral as well as having no sulphur compounds. The MTG process is also more selective than rival methods such as Fischer Tropsch polymerisation. HIF believe that converting renewable hydrogen to gasoline offers the opportunity to decarbonise difficult sectors like aviation. They also aim to move to direct CO2 capture from air in the longer term, and also have plans to potentially produce jet fuel via MTO followed by oligomerisation, hydrogenation and fractionation.

At Matagorda in Texas, 2GW of nuclear and wind power will be used to generate hydrogen for 4,000 t/d of methanol, which will then be used to produce gasoline. The process can operate flexibly between methanol and gasoline, allowing which stream is prioritised to be dependent on market conditions. The hydrogen block alone covers 30 acres and will be twice the size of the attendant methanol and MTG plants. The project is at the FEED stage, and construction is due to start in 2024 with a $6 billion price tag. Even so, e-gasoline will be delivered to California at prices cost competitive with fossil fuel gasoline, but at an 80% reduction in carbon intensity. The CO2 source will come from CO2 recovered from industrial generation in Texas.

Hakan Kihlberg of Perstorp described Project Air, a collaborative project with Uniper to develop a 200,000 t/a green methanol plant in Sweden. Perstorp has committed to reducing Scope 1 and 2 emissions by 46% in 2030 compared to a base year of 2019, but does not see that there is sufficient biomass available at a reasonable price to achieve this using bio-methanol. Hence it has focused on hydrogen electrolysis and e-methanol to feed its future sustainable downstream operations.

Operator experience

GPIC’s Mousa Altairei reported on creep damage discovered in the reformer in Bahrain. Some 24 tubes had to be replaced after an inspection and an investigation was launched into why this was. Damage and blockage of the coffin box appeared to have restricted gas flow in the bottom of the reformer, exacerbated by burner degradation and deposit build up leading to fuel gas combustion taking place lower down the reformer.

Kerwyn Mahato and Garrett Ramjattan of PROMAN described a pipe rupture at a large scale methanol facility which caused damage to surrounding equipment and which could have led to injury or fatality if personnel had been in the vicinity. The failure resulted from high mechanical loads on a pipe elbow joint combined with manufacturing defects.

Methanol technology

Daniel Sheldon showcased JM’s latest methanol flowsheets, which they call the Flexi Methanol and Precision Methanol processes. Flexi Methanol combines the combined reforming, series loop and radial steam raising converter to produce a flexible but efficient route from natural gas to methanol in a wide range of scenarios. Heat from the converter generates sufficient steam for the new lower steam: carbon ratio and a lower pressure drop, reducing capital cost. Precision Methanol uses auto-thermal reforming with axial steam raising converters to deliver a simple flowsheet with low equipment count without compromising on efficiency, ideally suited to gas feeds with low inert levels. JM now also offer Switch Methanol, where much of the energy demand can be switched from gas to electricity, potentially significantly lowering carbon intensity of production.

For e-methanol, other routes become available. JM’s Connor Langland looked at using tube cooled converters in a green methanol plant. Designing a green methanol plant offers challenges and opportunities compared to a conventional plant. The lack of a reformer obviously lowers the capital cost (while increasing the feed cost), but it means any off-gases cannot be simply fed back into the reformer to destroy impurities. Using CO2 as a source of carbon also means that the syngas has far less carbon monoxide. CO provides half of the reactor heat in a conventional remover. This lowers the heat reformer duty, but higher water formation means that a higher catalyst volume is required. This has led JM to a converter and loop design tailored for a CO2 to methanol plant/ The circulation ratio now becomes the most important control parameter for reaction efficiency. A tube-cooled converter has lower power demand compared to an axial steam raising converter at such high flow rates.

Johnathan Mahabir of the University of the West Indies looked at ways of lowering carbon intensity of methanol production using a gas heated reformer. Modelling indicates that using a GHR can lead to 11% higher energy efficiency and 18% resource (feedstock) efficiency compared to ATR or SMR systems.

Iain Roberts of JM looked at ways of decarbonising methanol operations, including using JM’s Switch Methanol flowsheet as described above, which can reduce emissions by 80%, as well as the Clean-pace flowsheet using carbon capture and storage to achieve up to 97% reductions in carbon intensity.

Giacomo Rispoli of MyRechemical looked at using gasified municipal waste as a feedstock for methanol production. MyRechemical’s flowsheet captures excess CO2 from methanol production for sequestration or utilisation.

Finally, Philip Lewis of ZEEP presented a slightly pessimistic view of the energy transition, considering the acreage of solar panels required to feed a world scale methanol plant and the increasing difficulty of gaining planning permission for them, and the slow pace of the planning process for carbon capture and storage projects.

Plant monitoring

TUV Rheinland Industrial Services showcased their array of plant monitoring and inspection services, including online nonintrusive inspection and condition monitoring, with reference to work conducted for MOL in Hungary. Reformer tubes, remain the Achilles heel of steam reformers, having to cope with the most strenuous operating conditions. The microstructure of the steel can change over operating lifetime, leaving tubes vulnerable to creep corrosion. Olivia Chung of Quest (formerly Quest Integrity) showed how the two are related and how accurate tube lifetimes can be calculated from metal microstructure measurements.

Catalysts

Unsurprisingly for a company that is a major catalyst manufacturer there was a session on new catalyst developments. JM’s Pauline Glen looked at methanol synthesis catalysts, and the way in which the active copper sites were deactivated during operation via sintering. Zinc oxide and alumina are added to reduce this, but analysis of zinc oxide in spent catalysts shows that it too is subject to sintering. JM has now developed a catalyst formulation, KATALCO 51-102 which is doped with a silicon compound that reduces zinc sintering and hence preserves higher activity for longer.

John Brightling, meanwhile, looked at handling of nickel-based catalysts in a methanol plant. Nickel catalysts are used in hydrodesulphurisation pre-treating, as well as in the pre-reformer and reformers, but can lead to the generation of nickel dust, which is a potential respiratory tract carcinogen. This can be mitigated through catalyst structure and composition, better controls on loading and unloading, and better ventilation and atmospheric monitoring, as well as use of the correct personal protective equipment.

Digitisation

Three papers on digital advances closed out the conference on Wednesday. Liam Fleming of JM looked at optimisation of methanol plant operation using the increasing data streams available to plant operators. Jesus Rebordinos of Stamicarbon described operator training simulators and ‘digital twin’ plants, as well as newer technologies like virtual and augmented reality to improve plant operation. Daniel Sheldon of JM closed with a presentation of the JM-LEVO methanol portal; a new more efficient digital method of performance reporting and communicating with JM service engineers.