Economic and market potential for SRC-II products

Abstract

The SRC-II process being developed by Gulf Oil Corporation under a contract with the Fossil Fuel Division of the United States Department of Energy has shown considerable promise in pilot plant work, and plans are now being made to demonstrate the process using commercial size equipment in a 6000 tons/day (T/D) plant to be located near Morgantown, West Virginia. the products (both liquid and gas) from a future large-scale commercial plant are expected to have an overall selling price of $3·50-4·00 per million Btu (fourth quarter 1978 basis). The major product of the primary process is distillate fuel oil of less than 0·3 per cent sulphur for use at the outset largely as a non-polluting fuel for generating electrical power and steam, especially in the east where utilities and industry are presently using petroleum products. In such applications, SRC-II fuel oil is expected to become competitive with petroleum-derived fuels within the next decade. During this period, SRC-II fuel oil should be economically attractive compared to coal combustion with flue gas desulphurization in electric utility and industrial boilers, particularly in the major metropolitan areas. For the longer term, the major growth opportunity for SRC-II fuel oil in the generation of electric power will probably be through advanced combustion turbine units with heat recovery boilers (combined cycle units). The light liquid fractions (naphtha and middle distillate) produced by the SRC-II process can be upgraded to a high octane unleaded gasoline blending stock to supplement petroleum-derived supplies. Significant quantities of pipeline gas are also produced at a cost which should be competitive with SNG from direct coal gasification. Light hydrocarbons (ethane, propane) from the process may be effectively converted to ethylene in conventional cracking plants to offset ethylene demand from petroleum-derived naphtha and gas oil, both of which could otherwise be used for other refinery products. In addition, certain fractions of the fuel oil might also be used in medium speed diesel engines and automotive gas turbines. For many of these applications, the fuel oil and other products from the SRC-II process would displace high quality petroleum fractions, which could then be used for production of diesel fuels, jet fuels, home heating oil, and gasoline by conventional refinery processes.