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President of UN climate summit in Qatar says shale gas is “good news”

By Ed King

COP18 President Al-Attiyah is a former President of OPEC

The President of the forthcoming UN Climate Change Summit in Qatar says shale gas is “good news” and will ensure global energy security for the next 300 years.

In comments which raise serious questions over Qatar’s ambitions for the COP18 negotiations, which start in Doha on November 26, His Excellency Abdullah bin Hamad Al-Attiyah, deputy Prime Minister of the Gulf state, said the exploitation of unconventional sources of fossil fuels would be good for consumers.

“It’s good news because it gives the world trust and confidence in gas,” he told a TV reporter at the 2012 Oil and Money Conference.

“A few years ago there was uncertainty about enough supply to the world – today the gas will give the world 300 years of security. I believe this is good news and it will give the consumer more trust in gas.”

Al-Attiyah, who is a former President of OPEC and won the Petroleum Executive of the Year Award in 2008, was speaking a day after the International Energy Agency (IEA) warned that “no more than one-third of proven reserves of fossil fuels can be consumed prior to 2050 if the world is to avoid warming by 2°C, unless carbon capture and storage (CCS) technology can be deployed”.

Earlier this year the IEA’s chief economist Fatih Birol said the world was on course to warm by 6°C, unless urgent action was taken to avoid carbon lock-in before 2017.

Qatari leadership

As President of the UN climate talks Al-Attiyah is expected to play a key role in ensuring negotiations run smoothly and that the stated ambition of all parties to avoid warming beyond 2°C is kept on course.

Despite the state’s activity in international diplomacy, there have been increasing concerns in recent weeks over Qatar’s ability to cope with this round of climate talks, which will be complex given the number of negotiating streams.

The UNFCCC says it is happy with preparations, but these comments will add to the view that the Emirate, which boasts the highest per-capita emissions in the world, is firmly committed to a high-carbon future.

Reacting to these comments, WWF-UK’s International Climate Change Policy Advisor Kat Watts said it was vital all Parties heading to Doha realised the world needed to move away from oil and gas as a source of energy.

“All governments need to realize that the future cannot be not fossil fuelled. There are massive greenhouse gas emissions in both production and consumption of coal, oil, gas, and the only way to minimize the climate crisis is to keep them in the groun,” she said.

“The IEA’s report is an important wake-up call – but even their scenario only has about a 50% chance of keeping below a global 2ºC temperature increase.”

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  • Tony Day

    WWF’s anti-gas policy is based on a scientifically and economically flawed analysis. Methane used for energy production is not necessarily either a fossil energy resource, or a cause of anthropogenic global warming.

    Synthetic Methane produced from mixed renewable and fossil fuels can be decarbonised at lower market cost than fossil Natural Gas.

    • Frances Hunt

      To Tony Day: This sort of wishful thinking and refusal to face the problem will be disastrous to humanity within our lifetimes. ALL overproduction of greenhouse gasses, whether ‘natural’ or fossil in origin, is adding to the blanket of warming. Methane is considerably worse than carbon dioxide in its adverse climate effect. Fracked gas may save your wealth but not your life.

    • Daniel

      Citation, Tony? I’d love to see evidence that non-fossil methane can be scaled up in an environmentally responsible manner, and that methane of any kind can be decarbonised (a) at the scale of the global economy, and (b) without destroying the resource’s EROEI.

  • Brian H

    Al-Attiyah is perfectly correct. The temperature extrapolations everyone is yammering about were pulled out of some political asses. EVERY prediction bases on CO2 forcing has failed, and EVERY GCM (model) has been proven to have “no skill on any time scale”.

    Pray some warming resumes. Temperatures have begun to fall, and are due for about 30 yrs of decline. You won’t like it.

    • Brian H

      typo: “prediction based on…”

  • Tony Day

    Two commentators queeried my earlier post. Please excuse this lengthy response.

    Synthetic Methane (or Synthetic Natural Gas – SNG)can be produced from just about any fuel containing some carbon. Between 1955 and 1992 a large scale joint UK government/British Gas Corporation R and D programme developed the technology to supply the whole of UK gas demand by Synthetic Methane when North Sea gas ran out. The prototype British SNG plant is still sitting disused at Westfield in Scotland. The catalysts developed by British Gas have been used since 1984 at the World’s largest and longest-running SNG plant at Gt. Plains in Dakota, and are currently being used at the new SNG plant developed by Datang in China. Gt. Plains is also since 2000, the World’s largest and longest-running CCS plant. Industrial scale SNG is being developed in China under the current 2010 to 2015 Five Year Plan.

    All SNG plants are inherently Carbon Capture Ready as around 50% of the total Carbon throughput is produced as CO2 as a waste by-product. The first question, therefore, is how to economically capture this CO2 at a purity and pressure suitable for CCS?

    The late Cyril Timmins, who was one of the lead engineers on the British Gas SNG development team invented a simple re-arrangement of the back end of an SNG plant, using all standard process industry technologies, avoiding the use of Nitrogen as a ‘stripping’ gas, and pressure let down, to remove CO2. High purity liquid CO2 is produced at 60 bar with no loss of energy efficiency.

    The second major question is how to produce SNG at an economic price? Coal to SNG is not economic in EU due to the relatively high price of coal, and low price of Natural Gas. In China, the opposite applies: cheap coal and expensive Natural Gas, so coal to SNG is economic.

    British Gas was aware in the early 1970′s that waste can be used as a substitute fuel in lieu of coal. This has major economic benefits. The avoided cost of the 2015 UK Landfill Tax escalator will be £80/tonne. As a typical mixed waste stream has a calorific value of around 10GJ/tonne, waste is a negative price fuel with a value of around £-8/GJ. This can be used to offset the cost of coal and biomass at typically £3.0 to £3.50/GJ in UK. It is easy to see that a net zero cost fuel mix of waste, biomass and coal can be developed.

    Between the late 1980′s and 2007, industrial scale co-gasification, using British Gss technology, of up to 80% mixed wastes and biomass and 20% coal and lignite was operated commercially at industrial scale at SVZ Schwarze Pumpe. This was supported by the EU Thermie programme, and fully documented by the local state government and UNEP.

    A typical mixed waste stream contains around 65% biogenic Carbon. Assuming a 50% waste:30% biomass:20% coal fuel, it is easy to see that a net 50+% biogenic Carbon fuel can be designed, which will also have zero net cost.

    The “Carbon Neutral SNG” concept combines Bioenergy CCS (BECCS) and fossil fuels. Assuming a 50% biogenic: 50% fossil Carbon fuel mix, and 50% total Carbon Capture and Sequestration, net zero emissions energy is produced as the 25% sequestered biogenic Carbon offsets the emitted 25% fossil Carbon emissions. In our case we use a 54% biogenic Carbon fuel mix with 54% CCS to produce slightly negative net emissions energy.

    The original British Gas SNG scheme produced SNG at a net efficiency of 76% at a gasification pressure of around 80 bar. Using a part waste fuel mix increases efficiency as the waste plastics produce Methane during gasification, thus increasing net efficiency to SNG. Similarly integrating the Timmins CCS scheme into the base SNG plant design also increases net efficiency as excess CO2 is used instead of steam to suppress the Boudouard reaction in the combined catalytic shift and methanation process. The combined effect is to increase overall plant efficiency to 76.75% while producing 60 bar pipeline ready SNG, and high purity 60 bar pipeline ready supercritical CO2 from low cost, low grade fuels.

    The last 2 ‘key’ questions are: How much will decarbonised SNG with CCS cost; and is there sufficient fuel available?

    Between 1985 and 1989 a major engineering and cost benefit analysis study was undertaken by UK Design Group to minimise the output cost of SNG. UK Design Gourp consisted of: British Gas Corporation (now GL Noble Denton Ltd); Davy McKee (now Davy Process Technology Ltd, a subsidiary of Johnson Matthey plc); Babcock Woodall-Duckham (now part of Doosan), and John Brown Engineering, with vendor quotes for proprietqary gas clean up plant being obtained from several major process engineering OEM’s. The study was commercially confidential, and was never published.

    We have had the good fortune to be able to recover the only extant largely complete copy of the final version of the study. The study examined the relationship between plant size, Capital cost, operating pressure and several different proprietary gas clean up processes. We have been able to recreate the optimum process flow diagram and cost benefit analysis where British Gas left off in 1989, combined with operational data from live gasification plants operating since British Gas ceased SNG development in 1989.

    What has become apparent is that British Gas made a substantial error when calculating the output cost of SNG. The study commenced in 1985, the year after the 1984 miners’ strike, but before British Gas was privatised in 1986. HMTreasury and the UK nationalised energy industries had a somewhat ‘cosy’ relationship where expensive British coal was transferred from nationalised National Coal Board to the nationalised British Gas Corporation and Central Electricity Generating Board at cost, without reference to the international market price of coal. In essence British Gas was buying UK coal at a very uncompetitive price compared with the open market!

    On the other hand, British Gas paid HMTreasury a very high price for money. In the aftermath of Britain’s inflationary 1970′s and 870′s, and HMG having to be bailed out by IMF in 1978, HMTreasury set very onerous rules on payback periods and Weighted Aggregate Cost of Capital. The real cost of Treasury money to British Gas was substantially higher than the open market cost of money despite Gilts being cheaper than money market funding!

    Despite British Gas Corporation being privatised in 1986 as a national commercial energy monopoly, with no competitors, old habits die hard, and the cost of coal and money being used by British Gas for planning purposes in 1989 was still the same as in 1984/5. In consequence, the output cost of SNG projected in 1985 was around 50% higher than it should have been based on the open market costs of coal and money. EU released bulk North Sea gas for power generation in 1991. Even allowing for correcting the cost of coal and money, the output cost of SNG could never have competed with cheap North Sea gas. In 1992, the British Gas SNG development project was shut down.

    Taking the 1989 cost benefit analysis figures and bringing them up to date to 2012 costs, using mixed waste, biomass and coal as fuel, with the addition of Timmins CCS, gives an output cost of decarbonised SNG in the range 27 to 35 p/therm. The original British Gas cheme was for modular 5 mtpa coal to SNG. Allowing for the lower cv of mixed wastes, biomass and coal requires a 6.25 to 6.75 mtpa plant.

    At the lower end of the scale, a 0.75 to 1.5 mtpa mixed wastes, biomass and coal to SNG plant with CCS has an output cost around 45 to 65 p/therm.

    We are currently working on an updated plant design, based on more detailed engineering information, with a target output cost of SNG of 40 to 45p/therm in order to be cost competitive with the lower end of DECC’s projections for the open market wholesale price of gas between 2020 and 2030. I anticipate a plant size in the range 1.5 mtpa +/- 0.5 mtpa at a target Capital cost of £1.8bn/GWth energy input. This scheme will be published around the end of February 2013.

    The last question is: how much fuel is there? UK produces between 250 and 275 mtpa of energy bearing solid fuels: wastes of all kinds, biomass and coal. This total excludes dedicated food and biofuel crops and non energy bearing mineral and construction wastes.

    At the bottom of a BGL gasifier at around 1800degC, 70 bar pressure and reducing (Oxygen depleted) atmosphere, all organic molecular bonds break down, and the ‘soup’ of Carbon, Hydrogen and Oxygen atoms behaves and reacts the same irrespective of where they originated from. There is no physical or chemical need to differentiate between biogenic and fossil carbon, or hazardous or non-hazardous wastes. Dioxin and furan formation is prevented. Heavy metals and mineral are discharged as liquid slag which cools to form a stable non-leaching vitrified aggregate.

    We estimate that if 75 mtpa of this total of 250 to 275 mtpa can be collected into the fuel input stream to a UK decarbonised gas programme, this will be sufficient to supply 33% of total UK gas demand, or if used for power generation will generate 25GW of base load at 8000 hours pa load factor, all at approximately zero net Carbon emissions.

    Gas is a storable primary energy vector. Decarbonised SNG injected into the existing high pressure gas National Transmission System will decarbonise all downstream gas users (industry, power, heat and transport) at zero cost to the latter, and without requiring major energy infrastructure investments. On average 3 times more energy flows through the UK gas grid compared with the electricity grid, increasing to 5 times more in Winter. 250 times more energy is stored in UK as gas than as electricity. The cost of transmitting gas is 1/15th cost of electricity.

    At 40 to 45 p/therm the target cost of decarbonised SNG is 1/6th the cost per unit energy of the UK 2030 target cost of £100/MWh for decarbonised electricity.

    We propose to HMG a technology neutral balanced policy of equal renewables and decarbonisation targets for gas and electricity, with equal Return on Capital Employed net zero value (over the economic cycle) Contracts for Differences (CfD’s) for low carbon gas and electricity. We proposed that the relative CfD ‘strike prices’ for low carbon gas and electricity be set at the historic wholesale open market price ratio of electricity to gas at 3:1 per unit energy.

    Best wishes,

    Tony Day