monetizing shale gas - adi...
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ADI ANALYTICS LLC
Houston New Delhi
+1 (281) 506-8234
www.adi-analytics.com
Monetizing Shale Gas Benchmarking Gas Utilization and Conversion Options
Prospectus
Multi-Client Study
© 2009-2013 ADI Analytics LLC
1
The discovery and rapid proliferation of shale gas basins in North America is driving up natural gas supplies but …
Source: U.S. Department of Energy; EIA Annual Energy Outlook 2011
U.S. Natural Gas Supply
(Trillion Cubic Feet Per Year)
19.2
21.3
23.4
25.1
2000 2010 2020p 2030p
Shale Gas Other
North American Shale Gas Basins
2
… Depressing gas prices and altering oil-gas price parity leading to new interest in gas utilization and conversion
$54
$25 $29
$40
$50
$76
$119
$181
2005 2010 2020p 2035p
Gas Oil
U.S. Natural Gas and Oil Prices
(Nominal Price, U.S. $ / BOE)
Source: EIA Annual Energy Outlook 2011
Oil and gas at
price parity
Oil and gas out
of price parity
Recent Market Themes
Gas substituting coal for power
LNG importers considering conversion to export terminals
Chemical companies planning new crackers in shale basins
Producers exploring gas conversion to fuels / chemicals
Efforts to promote natural gas-based transportation
$9.68
$4.43 $5.18
$7.19
Gas price,
$/MM Btu
3
This multi-client study has benchmarked a number of options to utilize, convert, and monetize natural gas and …
Natural
Gas
Electricity
LNG
Liquid Fuels
Chemicals
Transportation
Gas Utilization Options
Syngas
Natural
Gas
Fischer
Tropsch Methanol Hydrogen
Naphtha
Jet Fuel
Diesel
DME
Olefins
Gasoline
Refineries
Fuel Cells
Ammonia
Transportation
fuels
Oxygen
Chemicals
Gas Conversion Processes
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… Addressed key questions to deliver several actionable insights for various stakeholders …
Representative Study Questions
Will GTL be used to convert gas to gasoline and diesel?
Are hydrogen or DME feasible?
Liquid Fuels
(GTL)
Can we shift to a CNG-based transportation infrastructure?
What are key CNG signposts?
Transportation
How much NGL supply can be absorbed for chemicals?
Which markets will U.S. chemical resurgence serve?
Chemicals
and NGLs
What happens to LNG imports?
Will U.S. export shale gas?
LNG
How much coal will gas replace to produce power?
Will carbon policy have a role?
Power
Forecast supply and
demand of gas, NGLs,
and products
Evaluate supply and
demand impacts
Assess impacts in
multiple scenarios
Markets
Estimate capex / opex
Benchmark options
based on IRR, NPV,
markets, and risks
Discuss key business
models
Evaluate key scenarios
Costs / Economics
Gather competitive
intelligence to review
market developments
Assess regulatory
issues
Evaluate CNG market
penetration for
transportation
Competitive Activity
Review technologies to
convert gas into LNG,
GTL (gasoline, diesel)
and chemicals
Discuss leading
technology licensors
Profile emerging gas
utilization technologies
Technology
Deliverable Insights
5
… Including economics of various gas monetization options at different scales and locations in North America
Feed
MM cfd
LNG
MM tpa
GTL
bpd
MTG
bpd
100 N/A ~10,000 ~10,000
500 3.8 ~54,000 ~54,000
1,000 7.6 ~100,000 ~100,000
Gas Monetization Options and Plant Capacities
Gas Monetization Plant Locations
Location LNG GTL MTG
U.S. East
Coast
U.S. Gulf
Coast
Rockies
Western
Canada
6
Finally, the study includes a comprehensive view of the competitive landscape by profiling recent project proposals
Highly dynamic environment of proposed monetization and infrastructure activity
Liquefied
Natural
Gas (LNG)
Proposals for 14 plants totaling 157 MTPA of LNG export
capacity with a maximum of 80 MTPA likely over 2016-2020
Conversion of import terminals and new export terminals
Gas to Liquids
(GTL) / Methanol
to Gasoline (MTG)
Proposals for 5 projects including 4 GTL and 1 MTG with
~215,000 to ~360,000 bpd of capacity
New GTL and MTG projects and technology development efforts
Midstream
Proposals for 7 NGL pipelines with ~1.1 million bpd capacity
Plans for 4 ethane pipelines with ~335,000 bpd of capacity
Proposals for 20 new fractionators with ~800,000 bpd capacity
Petrochemical
Crackers
Proposals to add ~540,000 bpd of ethane cracking capacity
New, revamp, expansion, or restart of existing crackers
Natural Gas
Vehicles (NGVs)
Several companies converting fleets to natural gas and …
… Planning own or state-funded natural gas fueling stations
Some projects on LNG for freight and heavy-duty transport
1
2
3
4
5
7
The “Table of Contents” reflects the study’s structured and comprehensive scope of work …
3
Overview of Natural Gas Industry Gas supply, sources, and outlook
Gas demand, user segments, and outlook
Imports, exports, and supply-demand gaps
4
Liquefied Natural Gas (LNG) Technology and licensors review
Product demand and pricing
Cost and economic analyses
Recent competitive / market developments
5
Gas to Liquids (GTL) Technology and licensors review
Product demand and pricing
Cost and economic analyses
Recent competitive / market developments
6
Methanol to DME / Gasoline Technology and licensors review
Product demand and pricing
Cost and economic analyses
Recent competitive / market developments
8
Natural Gas Vehicles (NGVs) Fleet size and growth assessment
Impact on natural gas consumption
Infrastructure costs and market development
9
Gas Demand Scenarios Sector-wise gas assessment
Growth scenarios for gas demand
Comparison of supply-demand gaps
10
Competitive Landscape Profiles of ~40 project proposals in …
… LNG, GTL, and MTG and …
… Midstream, chemicals, and NGVs
1 Executive Summary
11 Appendix: Methodology & Assumptions
2
Introduction Purpose and objectives
Deliverables and benefits
Study team and methodology
7
Natural Gas Liquids (NGLs) Utilization Supply, demand, and pricing outlook
Review of cross-basin infrastructure
Recent competitive / market developments
8
… Executed by a team with top-tier industry and consulting experience along with deep gas monetization expertise …
Expert Team
Uday Turaga holds a PhD in Fuel Science from Penn State and an
MBA from UT Austin. Through stints at ExxonMobil, ConocoPhillips,
and Booz, Uday has developed strategy for shale gas operators,
analyzed economics of oil/gas projects, commercialized fuels
technology, and conducted regulatory analysis / scenario planning.
Vis Viswanathan brings 35 years of experience with Akzo-Nobel,
ConocoPhillips, and Lummus in process development / economics
and technology evaluation for refining and chemicals. He brings
deep expertise in gas monetization, including Gas-to-Liquids. He
holds a Ph.D. from University of Minnesota in Chemical Engineering.
Vishakha Shembekar brings deep expertise in oil and gas,
chemicals, and renewables with emphasis on chemical industry
applications of natural gas. She holds a Ph.D. from the Indian
Institute of Technology, Mumbai and brings nearly 10 years of
experience gained at Cornell, Dow, and Merck.
Colin McHattie brings technical and commercial oil, gas, and LNG
project initiation and development experience spanning over 30
years with ConocoPhillips. His contributions span management,
business, geoscience, and research roles including serving as
Manager of Gas-to-Liquids and Carbon Conversion Technologies.
Commodity pricing
Oil/gas project economics
Refining / fuels technology
Technology assessment
Project management
Gas and syngas conversion
Risk evaluation
Process economics
Technology assessment
Process selection
Natural gas-derived chemicals
Chemical pricing / markets
Technology assessment
Analytical modeling
E&P asset management
Project development
Gas commercialization
Strategic planning
New opportunity/tech assessment
9
… Using a robust methodology with findings peer reviewed by distinguished advisors and Fortune 500 subscribers
Peer Review / Subscriber Validation
Study Subscribers Including Fortune 500 companies: Subscribers have reviewed our study and contributed to it by providing non-confidential inputs
EPC Company: Leading EPC firm with expertise in GTL, LNG, and Chemicals reviewed cost methodology and data
LNG Expert: Recently-retired executive from a leading LNG player guided the LNG analyses and findings
GTL Expert: Renowned GTL expert with experience in three majors advised on the GTL analyses and findings
Methodological Tools
Methods
and
Tools
Primary Research
Secondary Research
Hypothesis Driven
Analytical Modeling
TechnicalAnalysis
Value Chain
Analysis
10
In summary, our study is independent, current, and unique, and will benefit you with actionable deliverables and insights
Supply, demand, price, and market outlook for natural gas and NGLs
Apples-to-apples economic comparison of LNG, GTL, and chemicals
Profiles of competitive activity and project plans in gas monetization
Synopses of gas monetization process and technology readiness
Two interim updates, findings workshop, and final report
Deliverables
Benefits
Cutting-edge market perspectives on natural gas monetization
Independent analysis of investment options around gas monetization
Appraisal of best-in-class gas monetization processes and technologies
Access to deep industry and top-tier consulting expertise cost-effectively
Participation in a subscriber-driven, interactive, and peer-reviewed study
Audience
Oil / Gas Majors
National Oil Cos.
Midstream Firms
E&P Independents
Chemical Companies
EPC Firms
R&D Groups
Strategy Teams
Tech. Licensors
Industry Associations
Banks
VC Firms
PE Investors
Governments
Consulting Firms
Operating Companies Corporate Functions Service Providers
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Subscribers can join and participate in this study at a competitive and cost-effective fee
Fee: U.S. $24,900
Fee is due on sign-up
Subscription includes following deliverables:
Draft report
Client workshop
Final ~250-page report
Insights / analyses for select client questions
For more info, contact Uday Turaga at +1.832.768.8806 or [email protected]
Report and workshop
scheduling available
immediately
12
ADI Analytics is a boutique consulting firm serving energy and chemical companies with passion, rigor, and expertise
OperationsMarkets FunctionsTechnology
Oil &
Gas
ProductionExploration Refining Distribution
Renewables &
Cleantech
GeothermalBiomass WindSolar
Chemical &
Industrial
Plastics Materials ManufacturingAuto
Power &
Mining
Coal Generation CarbonTransmission
13
Our value proposition – deep expertise, proprietary analytics, and cost-effective rates – is designed to help clients succeed
Bring frontline industry expertise
Lead with content, data, and analytics
Deliver value with cost-effective rates
14
Fortune 500 and mid-sized companies, start-ups, investors, and governments have hired us to shape decisions globally
15
ADI Analytics offers a variety of consulting services to help clients with issues in markets, operations, and technology …
Markets
Technology
Operations
Grow businesses
Market research
Strategic planning
Investment analysis
Opportunity assessment
Competitive benchmarking
Address uncertainty
Market and price forecasts
Technology assessment
Regulatory analysis
Scenario planning
Risk assessment
Optimize operations
Vendor evaluation
Cost benchmarking
Technology scale-up
Capital project support
Operational excellence
Strengthen functions
Innovation / R&D strategy
Communications design
Organizational planning
Sustainability audit
Process design
16
… Complemented by insightful multi-client studies and advisories to help clients accelerate decision making
Repowering transportation
with natural gas
Summer 2012
Innovation needs in
Marcellus shale
Fall 2011
Economics of carbon
conversion and utilization
Fall 2010
Supply outlook for
advanced biofuels
Spring 2010
Strategic overview of
geothermal energy
Fall 2010
New!
Our studies offer many benefits …
Enable focus on decision making
Provide an independent, expert viewpoint
Based on a rigorous, fact-based methodology
Delivered quickly, cheaply, and collaboratively
... Address critical industry issues and …
Bottom-up cost and economic analyses
Appraisals of best-in-class technologies
Competitive landscapes and benchmarking
Supply, demand, market, and pricing outlooks
… Provide actionable deliverables
On-site findings workshops
Final reports and data packs
Interim updates via conference calls
Team access and analyst time for follow-up
Benchmarking shale gas
monetization options
Spring 2012 New!
17
ADI Analytics has completed several projects and brings a rich set of energy and chemical industry qualifications
OIL & GAS COAL & POWER CLEANTECH INDUSTRIAL
MARKET
RESEARCH
Oilfield services
market size for
PE firm
EGS demo plant
profiles for U.S.
DOE
Outlook for
advanced biofuels
for multiple clients
Tank fabrication
market size for
PE firm
STRATEGIC
PLANNING
Shale gas
monetization
options for major
Strategy and M&A
support for coal
company
Product strategy
for cleantech
start-up
White spaces in
sulfur market for
material maker
COMPETITIVE
BENCHMARKING
Benchmarked
sustainability /
CSR in E&P firms
Evaluated new
drilling processes
for U.S. DOE
Benchmarked
biofuel processes
for multiple clients
Oil sands process
comparison for
PE investor
INVESTMENT
ANALYSIS
Feasibility of
LNG, GTL, and
MTG for major
Levelized costs of
renewables for
U.S. DOE
Process costs
and breakeven
prices for start-up
Feasibility of plant
expansion for
service provider
TECHNOLOGY
ASSESSMENT
Operational pain
points for E&P
firms in Marcellus
Carbon capture
and utilization
review for NOC
Proppant product
benchmarking for
investment firm
Assessed energy-
efficient building
materials for NIST
Select Projects
Ask us for a full list!
18 CONFIDENTIAL
+1 (281) 506-8234
www.adi-analytics.com
Uday Turaga, Ph.D.
+1 (832) 768-8806
Prasada Rao, Ph.D.
+91 98103 38091
Vis Viswanathan, Ph.D.
+1 (832) 457-6486
Vishakha Shembekar, Ph.D.
+1 (979) 299-9052