Landfill gas: rags to riches?

Methane emissions from landfills account for 2% of global CO2e. c70% of these emissions could easily be abated for c$5/ton, simply by capturing and flaring the methane. Going further, low cost uses of landfill gas in heat and power can also make good sense. But vast subsidies for landfill gas upgrading, RNG vehicles and biogas-to-jet may not be cost-effective.

Landfill gas: the economics?

The purpose of this data-file is to model the typical costs of producing raw landfill gas (a mixture of CH4, CO2 and other impurities) at a solid waste landfilling facility.

Our capex and opex cost build-ups are derived from EPA guidance and our gas evolution equations are derived from a line-by-line breakdown of landfill products (below). Note this is prior to gas cleaning and upgrading.

We estimate that a typical landfill facility may be able to capture and abate 70% of its methane leaks for a CO2-equivalent cost of $5/ton. Other landfill gas pathways get more complex and expensive.

Power capacity of a typical home?

This data-file aims to estimate the power capacity required for a typical home circa 2010, 2020 and 2030, under various energy transition scenarios.

Our methodology is to tabulate the typical power consumption of various appliances, then estimate the number of these appliances that would be required.

A typical home in the developed world currently has a 10kW maximum power capacity before tripping its circuit-breaker (although it varies).

This could easily double in the energy transition, due to phasing back gas heating, gas cooking and the addition of home charging stations for electric vehicles.

The only thing is that upgrading the power capacity of home can typical cost $1,000-5,000, and sometimes as much as $20,000.

Gas-to-liquids: the economics?

This data-file captures the economics of gas-to-liquids, including the formation of syngas in an auto-thermal reformer, then the subsequent upgrading into liquids via the Fischer-Tropsch reaction.

Our base case is that $100/bbl realizations are required for a 10% IRR. You can stress-test the economics as a function of gas prices, capex costs, thermal efficiencies, carbon intensity, CO2 prices and other operating costs.

Our inputs for each of the categories above are substantiated by collating data-points from past projects and technical papers. Finally, our notes and review of GTL patents are outlined in the final tabs.

Gas treatment: an overview?

The data-file gives an overview of different gas-sweetening and gas-processing operations, outlining the process, indicative costs, and drawbacks. We also note 20 companies with gas treatment technologies, although our list is by no means exhaustive.

Gas sweetening may be particularly important as global gas demand trebles in our roadmap to net zero and to remove H2S and CO2 from growing volumes of biogas.

The main method used for conventional gas-sweetening is chemical absorption using amines. We estimate that a mid-size facility of 500mmcfd capacity must levy a $0.15/mcf gas treatment cost and emit around 3.5kg/boe, to take out c7% H2S and CO2 from the mix.

Small-scale biogas technologies can be an order of magnitude more expensive, especially for early-stage biological processes being explored.

Other technologies in the data-file include wet-scrubbing using solvents, membranes, metal oxide guards, swing absorption and water removal.

LNG in the energy transition: rewriting history?

A vast new up-cycle for LNG is in the offing, to meet energy transition goals, by displacing coal and improving industrial efficiency. 2024-25 LNG markets could by 100MTpa under-supplied, taking prices above $9/mcf. But at the same time, emerging technologies are re-shaping the industry, so well-run greenfield projects may resist the cost over-runs that marred the last cycle. This 18-page note outlines who might benefit and how.

LNG liquefaction: what challenges and opportunities?

This data-file tracks patent progress into LNG liquefaction plants from 2020, by reviewing forty recent patent filings from leading companies in the industry (integrated oil companies and service providers).

We reach three key conclusions:  (1) LNG capex costs should not be overly fixated upon, as they can come at the expense of higher opex and emissions intensities. (2) The next generation of modular plants offer a step-change from the first generation. (3) And new process technologies are helping to improve efficiency across different LNG process units and their fabrication.

The full data-file spells out our conclusions,  with details on each of the underlying patents, a review of companies filing LNG patents in 2020.

US shale gas: the economics?

This data-file breaks down the economics of US shale gas, in order to calculate the NPVs, IRRs and gas price breakevens of future drilling in major US shale basins (predominantly the Marcellus).

Underlying the analysis is a granular model of capex costs, broken down across 18 components. Our base case conclusion is that a $2/mcf hub pricing is required for a 10% IRR on a $7.2M shale gas well with 1.8kboed IP30 production.

Economics are sensitive. There is a perception the US has an infinite supply of gas at $2/mcf, but rising hurdle rates and regulatory risk may require higher prices.

Methanol production: the economics?

This model captures the economics and CO2 intensity of methanol production in different chemical pathways.

Different tabs of the model cover grey methanol production from gas reforming, blue methanol from blue hydrogen and industrially captured CO2, green methanol from green hydrogen and direct air capture CO2, and finally bio-methanol.

Inputs are taken from a wide survey of technical papers, cost breakdowns and energy intensity data. These are also broken down in the data-file.

Based on the analysis, we see interesting potential for bio-methanol and blue methanol as liquid fuels with lower carbon intensity than conventional oil products. You can stress-test input assumptions in the underlying model tabs.

Combustion fuels: energy economics and carbon content?

The purpose of this data-file is to disaggregate the energy economics of combusting different fuels, including natural gas, different oil products, NGLs, coal, hydrogen, methanol, ammonia et al.

In each case, we derive the enthalpies of combustion, the contributing share of carbon and hydrogen oxidation, and thus the CO2 emissions per unit of energy. We also derive the fuels’ energy density, expressed in kWh/kg, kWh/mcf and kWh/gallon.

There is recent enthusiasm to lower combustion emissions by blending hydrogen into gas grids. But materially greater decarbonization occurs by replacing coal/biomass with gas, or even replacing oil products with NGLs.