Syntroleum and Marathon progress plans for ultra-clean fuels production

Sep 10, 2001 02:00 AM

Syntroleum announced that it is progressing plans with Marathon Oil Company to develop a gas-to-liquids (GTL) project under a US Department of Energy program to produce ultra-clean fuels. These new products are expected to be a key part of meeting the demanding quality specifications that will be a feature of the fuels of tomorrow. In moving ahead with the construction phase of the project, a request for proposals has been issued to selected companies. The award of the Engineering, Procurement and Construction contract is expected to take place in the fourth quarter 2001.
Syntroleum and Marathon have been working together for several months in readiness for the DOE program. The agreement with the DOE was signed in July, as previously announced. Work on the $ 36 mm project, of which the DOE will fund $ 16 mm, has already begun.

Marathon is partly funding the project and is also providing technical and project management personnel to work with Syntroleum in the engineering, construction and operation of the synthetic fuels plant. Certain items of equipment from Syntroleum's pilot plant at BP's Cherry Point, Washington refinery are currently being dismantled for shipment to a site at Port of Catoosa near Tulsa, Oklahoma, where the new 70 bpd stand-alone fuels production facility will be built. Construction is scheduled to start in the first quarter 2002, with production and testing of fuels expected to continue through completion of the program in early 2004.
The DOE project calls for the production of ultra-clean synthetic diesel and jet fuels for a series of test programs that will be managed by Integrated Concepts Research Corporation. The synthetic fuels are expected to be initially tested in fleet vehicles in Washington, DC and Denali National Park, Alaska.

"Marathon is excited to be involved in this important project," said Tim Tipton, Marathon's vice president of Technology. "The development of commercial scale GTL technology has important implications for the future of the energy industry and society in general. Apart from the prospect of producing ultra-clean transportation fuels critical for improving urban air quality, the technology offers a means to avoid flaring of gas associated with oil production in many parts of the world."
"The data generated from the fleet demonstrations in commercial applications and other advanced engine tests will be complementary to all the testing that has already been done on Syntroleum fuels. The data generated will benefit our licensees, vehicle manufacturers, refiners and end-users because it will better define the environmental and operating benefits of these fuels," stated Larry Weick, VP of business development for Syntroleum. "We believe that this is very important information for the refining industry as refiners make decisions on how to comply with the ultra-low sulphur fuel specifications that go into effect in both Europe and the US in 2005 and 2006, respectively."

Syntroleum is the developer of proprietary technology for convertingnatural gas into synthetic liquid hydrocarbons. Syntroleum licenses its process to oil companies for the manufacture of fuels. Current licensees include ARCO (now BP), Enron, Ivanhoe Energy, Kerr-McGee, Marathon, Repsol-YPF, Texaco and the Commonwealth of Australia. Additionally, using its technology and in partnership with others, the company plans to build GTL plants in a number of global locations.

Marathon Oil, part of the USX-Marathon Group and a unit of USX, is a large fully integrated oil firm engaged in the worldwide exploration and production of crude oil and natural gas. Through Marathon Ashland Petroleum, the company also refines, markets and transports petroleum products in the United States.

Source: Syntroleum
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