Technical Report
                       Conversion  of Ammonia
                   Plants  to Methanol Production

                         Daniel P. Reiser
                          February  1982

Technical Reports do not necessarily represent final EPA  decisions
or positions.  They  are  intended to present technical analysis  of
issues using  data which are currently  available.   The purpose  in
the release of such reports is to facilitate the exchange  of  tech-
nical information  and  to inform the public of technical  develop-
ments which may form the basis  for  a final EPA decision,  position
or regulatory action.
             Standards Development and Support Branch
               Emission Control Technology Division
           Office  of Mobile  Source Air Pollution Control
                Office of Air,  Noise and Radiation
               U.S. Environmental Protection Agency


     This report  investigated the  technical  feasibility and  cap-
ital cost of converting an ammonia  plant  to a methanol  plant,  both
using  natural  gas  as a  feedstock.   It  was  determined that  the
ammonia industry, which  currently  produces about  20 million  tons
of ammonia per year in the U.S.,  could convert their facilities  to
produce 16.4  million tons  per year  of  methanol,  or  a fuel  oil
equivalent  of  150,000 barrels per  day.  Such a conversion  would
cost about  $2.1  billion,  compared  to  a  cost  of 4>3.1  billion  for
building new natural  gas-based methanol plants of the  same  capac-
ity.  While converting  ammonia plants  to methanol  production  has
favorable capital costs over  that of building  new plants, the sav-
ings  of  one-third  is  not   large,  particularly  considering  the
effects of eliminating (or reducing) ammonia  production.  Thus,  it
would appear  at  this time  that  large  savings cannot  be obtained
from the conversion of ammonia plants to methanol production.

Conversion of  Ammonia Plants to Methanol Production

     The U.S.  ammonia industry currently produces over  20 million
tons of ammonia,[1] primarily for use in the  fertilizer  industry.
Ammonia  is  also used  as  the  starting point  of  most military
explosives,  and  it  touches  some  aspect of nearly all other  indus-
tries in the U.S. [2]  Methanol is also an important  product  of  the
U.S. chemical industry,  and with  a  growing interest  in  methanol  as
a transportation  fuel,  an increase in its  production  may  become
even more desirable in  the  future.   Although  ammonia and methanol
appear  to  be  chemically  dissimilar,  both  compounds can  be  com-
mercially synthesized from the same feedstock, which is  primarily
natural gas.  With  future demand  of methanol  possibly  escalating,
an investigation may  be necessary to evaluate the feasibility  and
the cost of converting an existing  natural gas based ammonia plant
to the production of methanol.

     Although   ammonia appears  to  be   substantially  different  in
chemical composition  from methanol, much  of the  commercial synthe-
sis process is very similar  for  the two  chemical compounds.   Both
can  be  synthesized  from  the same  feedstock which  is  primarily
natural gas, to produce the large amounts of  hydrogen needed.   The
major difference between these two  commercial  syntheses  is that  in
ammonia production, all carbon containing gases  (particularly  car-
bon monoxide and carbon dioxide)  are removed  so that only nitrogen
and hydrogen remain to  react, while in methanol synthesis,  a  con-
siderable amount  of  carbon  monoxide  is  retained along  with  the
hydrogen and no nitrogen is  allowed to enter  the system.

     This report will analyze and discuss the feasibility and  the
cost  of converting an  ammonia plant  to production of  methanol.
The  first  section  of this  report will  outline the major  steps
involved with  the established industrial production of  ammonia.


In the  section  following  this,  the conversion of an  ammonia  plant
to  a methanol  plant  will  be  examined.   This  report  will  then
determine the total potential U.S. capacity  of methanol  production
from converted  ammonia plants,  and  the cost of  this  conversion  on
a plant basis and a nationwide basis.

I.   Description of the Commercial Production of  Ammonia[2,3]

     The  overall  commercial synthesis  of  ammonia  involves  the
reaction of nitrogen  from air and hydrogen  from natural gas  at  a
ratio of  1:3 at  high pressure and  relatively  low temperature  in
the presence of a catalyst.  This overall chemical reaction is:

     1/2 N2(g) + 3/2 H2(g) = NH3(g)

     A  typical  flow   diagram  for  the  commercial  production  of
ammonia is shown in Figure 1.  As was  mentioned  above, natural gas
is  at  present  the  most  common  feedstock used  for production  of
ammonia.  The basic steps  shown in Figure  1  for  converting natural
gas  into  ammonia will be  discussed  in this section.  These  steps
are  desulfurization,   primary   and   secondary  reforming,   shift
conversion,  carbon dioxide  removal,   synthesis  gas  purification,
and ammonia synthesis and recovery.

     In the first step, natural gas  (which is essentially  methane)
is introduced and  desulfurized.   Much  of the feed  natural  gas,  or
methane,  is  contaminated  with  sulfur-containing  compounds  which
may  poison catalysts  downstream in  the ammonia  synthesis  process.
Desulfurization  involves  the absorption of  sulfur-containing  com-
pounds  (which  is usually in the  form  of hydrogen  disulfide)  onto
activated  carbon  or  zinc  oxide.    After  desulfurization,   the
purified natural  gas  is ready  for  reacting in  the next  steps  of
steam reforming.

     As shown in Figure  1, the steam  reforming  steps of  the  pur-
ified  natural  gas feedstock   is  carried  out  in  two  catalytic
reaction stages.  The  first  stage is called the primary reformer,
where the methane is mixed with superheated  steam and  reacted  over
a  catalyst  to  produce a partially reformed  gas,  consisting  of
carbon  monoxide,  hydrogen and  unreacted  methane.   The   overall
reaction of the primary reformer is:

     CH4 + H20 = CO + 3 H2 (Primary reforming)

Primary reforming  is   carried  out  in  a  furnace  to accomodate  the
large heat transfer  required.   The exit gas temperature  is  about
750-850C  and  pressure   is  about  415-515  psig.   The  type  of
catalyst  used  depends on  the  temperature  and  pressure  in the
primary reformer.

     The next  step  is the secondary reformer  where the reforming
reaction is carried out to completion  (all of the methane  reacted)

                                                Figure 1

                                      Ammonia Plant Flow Diagram
                                                    CH.  + H00 = CO + 3H.
                                                      42            2
                        CO + 3H  = CH  +
                                                       CH. +  1/2  CL  =  CO  + 2H
                                                         !        i
                               + 3 Hr
          - 2NH,


also with  a catalyst.  As  shown in  Figure 1,  sufficient  air  is
added to  the  secondary reformer, serving  a dual purpose.   First,
the combustion  of  methane  and oxygen provides heat, which  is  used
to  react   the  remaining methane and  steam  to form  more  carbon
monoxide  and  hydrogen.  Second,  nitrogen  (via  the air)  is  also
added to  the  system in the  amount  required  later  in the  ammonia
synthesis  process.   This  amount  of air  is adjusted to  eventually
supply a  hydrogen/nitrogen  ratio of 3:1.   A nickel catalyst  sup-
ported  on alumina  is  generally  used  in  the  secondary  reformer.
Thus, while  the primary  reformer   is  used  for  reforming  methane
only,  the secondary  reformer  is   used  for  both  completing   the
reforming  process  and  providing the  necessary  nitrogen  required
later in  ammonia synthesis.   The overall reaction involved in  the
secondary reformer is:
     CH4 + 1/2 02 + 2N2 = CO + 2H2 + 2N2
     After the  primary  and secondary reformers,  the  next step  of
CO  shift  conversion is  applied  as shown  in Figure  1.   CO  shift
conversion  utilizes  the water-gas  shift  reaction  and  produces
hydrogen from carbon monoxide via the following reaction:

     CO + H20 = C02 + H2 (Shift reaction)

The bulk of the carbon monoxide  is first shifted  to carbon dioxide
in  a  high temperature  shift  converter  (HTS)  operating  at  350-
450C.  The gases are then cooled and most  of  the remaining  carbon
monoxide from the  HTS  is shifted  to carbon  dioxide in a  lower
temperature  shift  converter  (LTS)   at   a  temperature   of   about
200-250C.   The  HTS catalyst consists  mainly of  iron   oxide  and
chromium oxide.   The LTS  catalyst  consists of  copper oxide  sup-
ported on zinc oxide and alumina.

     The effluent  gases  leaving  the LTS converter from  the  shift
conversion step thus  contain carbon  dioxide which must be  removed
or  it will poison catalysts  used  in later  steps.   Most  of  the
carbon dioxide  is  removed in  the  bulk  removal  step  (as shown  in
Figure 1), where it is  reduced to trace amounts.   In  removing  the
carbon  dioxide,  scrubbing  with  an  gaseous  solution   of   mono-
ethanolamine  (MEA)  or  a hot  solution   of  potassium  carbonate  is
standard.  Activated carbon may  also  be  used as  a means  to  remove
carbon dioxide.

     After bulk carbon  dioxide  removal,  methanation  is  applied,
where  any  residual  carbon  monoxide  and carbon  dioxide  are  con-
verted to  methane,  since any carbon, oxygen,  or  oxygen-containing
compounds  poison  the  ammonia synthesizing  catalyst   in  the  last
step  of  the  ammonia  synthesis  process.   Methanation,  which  is
essentially the reverse  of  the  reforming reactions,   involves  the
following two reactions:

     CO + 3H2 = CH4 + H20


     C02 + 4H2 = CH4 + 2 H20

Temperatures  are typically  in  the  range  of  300-400C  and  the
catalyst is  usually nickel supported  on  alumina,  kaolin, or  cal-
cium aluminate cement.

     After  this  step,   the  carbon  monoxide  and  carbon dioxide
content  of  the treated  gas  is only  a few  parts  per million  and
does not affect the  remainder of the  ammonia synthesis  process.
However, the  methane itself  contains carbon  and must  be  elimi-
nated.   A cryogenic  purifier  system (which is not shown  in  Figure
1 as a distinct unit) is then  used  to remove all of  the  water  and
nearly all the methane.   In  this  unit the gas from methanation is
first dried to a very low dew  point,  then  cooled and  expanded  in a
turbine  to  liquefy  a portion  of  the  gas.  After further  cooling,
the  vapor  from  the  partially liquified  stream  is  scrubbed in  a
rectifying column to remove the required  amount of  the methane.

     The synthesis gas is now  ready for the  final step of compres-
sion and ammonia manufacture in the synthesis  loop.   This is shown
as  the  compression  ammonia   synthesis  unit  in  Figure  1.   The
reaction is:

     N2 + 3H2 = -2NH3

The  operating pressures  for most  synthesis loops fall in  the range
of  150-200  atm  (2200-2940  psig).    This  final  step  involves  a
catalyst which generally  consists  of iron  with the addition  of
oxides of aluminum  and  potassium.  Unreacted  gases  are  recycled.
In  almost all plants ammonia  is  recovered by condensation.   This
requires refrigeration, normally provided by the synthesis ammonia
itself.  Inerts  entering the  system  are normally  removed with  a
purge stream.

II.  Conversion of an Ammonia Plant  to Methanol Production[2,3]

     Commercial  synthesis of  methanol  involves  the  reaction  of
carbon monoxide  and hydrogen, both which can be  obtained  from  a
natural gas feedstock,  at an overall  ratio  of 1:2.   High tempera-
tures and pressures  are used,  in addition to  a catalyst  to speed
up the reaction.  The overall reaction is:

     CO + 2H2 = CH3OH

     A  flow  diagram representing  a   typical  commercial  methanol
production process is shown  in Figure 2.  When comparing  Figure  2
to the ammonia plant flow diagram of Figure  1, it can be  seen  that
the  initial  steps  of both processes  are  similar.   However, meth-
anol production also involves  additional  steps which  replace  many
of  the  steps involved  with  ammonia  production.   The basic  steps
shown  in Figure  2   for  production  of  methanol from a  converted
ammonia  plant are desulfurization,  steam reforming,  compression,

                             Methanol Flow Diagram From Converted Ammonia Plant

                                                       STEAM REFORMER
                                                     CH, + H.O = CO +  3H
                                                       42            L
                                                  CO + 2H  = CH OH


cryogenic purification, final sulfur removal,  and  methanol  synthe-
sis.  These steps will be discussed below.

     The first step  of methanol production is  the desulfurization
of natural gas,  which was also the  first step of  ammonia  produc-
tion.   As  with  ammonia  production  the  natural  gas  used  for
methanol production  must be  processed  free  of  sulfur to  prevent
poisoning  catalysts  downsteam.   After  desulfurization  the  next
step is  steam  reforming again similar to ammonia  production.   For
methanol  production,   only  one  reformer  is  typically  used  which
also involves the introduction of steam,  as shown  in Figure 2.   In
the  reformer unit,  the  steam  and  methane  react  to form  carbon
monoxide and hydrogen,  identical  to the reaction  occurring  in  the
primary  reformer   for  ammonia  production.    This   reaction   is
expressed as:

     CH4 + H20 = CO + 3H2

The  steam  reformer  in  methanol  production  produces  a   carbon
monoxide:hydrogen ratio  of  1:3,  while methanol synthesis requires
only a  1:2 ratio.   Thus,  as shown in Figure  2, carbon dioxide  is
added  to produce  carbon monoxide  and  consume hydrogen  via  the
reverse of the water gas shift reaction discussed  above.

     The steps following  the  steam reformer in methanol  synthesis
differ  from  that found  in  ammonia  synthesis.  First of all,  the
secondary reformer  the carbon  monoxide  shift  converters  and  the
carbon monoxide  removal  unit  are  unnecessary  for  methanol  produc-
tion.   Also,  the process  of  methanation  in  an  ammonia  plant  is
also eliminated  in  methanol production,  because  it is desired  to
retain as much carbon monoxide as  possible.

     However,  there  are  additional  steps  in  the  production  of
methanol which are  not present  in the production  of  ammonia.   The
first step is the compression of  carbon monoxide  and hydrogen that
has exited from  the reformer.  This  step improves  the conversion
of these reactants in  the methanol synthesis  unit.   A turbo-driven
centrigual compressor  is   usually   used  to  compress  the   carbon
monoxide:hydrogen mixture  from about  150 atm  to  300  atm.   Fol-
lowing the compression step,  nearly  all of the carbon dioxide  and
steam left are  removed in  a  standard  cryogenic feed  purification
unit.  A new cryogenic unit must  be  installed  since a higher pres-
sure  is used  for  methanol  synthesis  than  is used  for  ammonia
synthesis.  A second  cryogenic  unit  is  also necessary to separate
the dry,  carbon  dioxide-free  gas into  synthesis  gas (H2/CO  ratio
= 2,  CH^ + N2 about  1 percent)  and  a  tail gas which  is  used  as
fuel gas and consists  mainly  of unreacted methane  with  some carbon
monoxide.  The cryogenic units are shown together  in Figure  2.

     Following  the   two  cryogenic   units,  the  synthesis   gas  is
heated and passed through a zinc-oxide  sulfur-guard bed for  final
removal  of  hydrogen  sulfide  and  other  sulfur-containing  com-


pounds.   After  this  comes  the  methanol  synthesis  where  a  new
reactor (again because of higher  pressures  than  ammonia synthesis)
is required.  The final reaction taking place in the reactor is:

     2H2 + CO = CH30H

The methanol  is subsequently  cooled  and condensed.   Most of  the
synthesis  gas  passing   through  this  unit  is  not  converted  to
methanol and  is  recycled and mixed with  fresh,  incoming  synthesis

     In summary,  the  following units must  be  added to an ammonia
plant to convert it to methanol production:  the compression  unit,
two cryogenic  units,  the sulfur guard bed units, and  the  methanol
synthesis unit.

III. Capacity for Methanol Production

     The above  section  described the  steps involved with conver-
sion  of  an ammonia  plant  to  methanol  production.   This  section
will estimate  the nationwide capacity of methanol production  from
converted ammonia plants.

     The nationwide  capacity  of  methanol production  from a  con-
verted ammonia  plant  depends upon two factors.   First, the  ratio
of methanol  to ammonia  produced  must be determined,  based on  an
equal amount  of  natural  gas feed.  Second,  the  current nationwide
production  capacity   of  ammonia  must be determined.   These  two
factors will be examined below.

     The ratio of methanol  to ammonia production  can be based  on a
stoichiometric estimate  which  assumes the  same  amount of  natural
gas feedstock  in  both cases.  For ammonia synthesis,  the  limiting
factor is the  production of hydrogen which results in  the produc-
tion of about 4.86 tons  of  ammonia  for every ton of methane  feed.
For methanol  synthesis,  the limiting factor is  the production  of
carbon monoxide which results in  the production  of about 4 tons  of
methanol for every ton  of methane feed.  Thus,  on this basis  the
ratio  (by  weight)  of methanol  to ammonia  production capacity  is

     Now,  the  total ammonia production capacity  for the U.S.  must
be  estimated.   Current  (1981) U.S.  ammonia  production  capacity
should be  close  to  20  million  tons  based on  an estimate  by  a
recent report  on the ammonia  industry.[4]   In  that  report,  1981
ammonia production  estimates   are  broken  down  by  each   ammonia
producing  company and location, and are  based  on actual  February
1979  production  data.   There  are 81  plants in  operation in  the
U.S. producing  these  20 million  tons annually.[4]   The producers
of this ammonia and  the locations  of  their plants  are   shown  in
Table l.[4]


                                 Table 1

                     1981 Ammonia Production Capacity*
Agrico Chemical Co.
Air Products & Chem-
ical Co.

Allied Chemical Corp
American Cyanamid Co

Amoco Oil Co.

Apache Powder Co.

Atlas Chemical Co.

Beker Industries

Borden Chemical Co.

Camex, Inc.


CF Industries, Inc.
Chevron Chemical Co.

Columbia Nitrogen

Diamond Shamrock

Dow Chemical

E. I. DuPont de
Blytheville, AR
Donalds onville, LA
Verdigris, OK
New Orleans , LA
Pace Junction, FL
La Platte, NE
Hopewell, VA
Helena, AR
Fortier, LA
Fortier, LA
Texas City, TX
Benson, AZ
Joplin, MO
Conda, ID
Geismar, LA
Borger, TX
Columbus, MS
Donalds onville, LA
Donalds onville, LA
Donalds onville, LA
Donalds onville, LA
Fremont , NE
Terre Haute, IN
Pascagoula, MS
Fort Madison, LA
El Segundo, CA
Augusta, GA
Dumax, TX
Freeport, TX
Beaumont, TX
Victoria, TX
1,000 Tons Per Year


El Paso Products

Farmland Industries

        Table 1 (Cont'd)

1981 Ammonia Production Capacity


             Odessa, TX

             Fort Dodge, IA
             Dodge City, KS
             Hastings, NE
             Enid, OK
             Lawrence, KS
             Pollock, LA
Farmers Chem-CF Ind.

Felmont Oil Corp.

First Miss Corp.

FMC Corp.

Gardinier, Inc.

Georgia Pacific

Grace-Okla. Nitrogen

W. R. Grace & Co.

Green Valley Chemical

Hawkeye Chemical

Hercules, Inc.

Hooker Chemical Co.

International Minerals
& Chemicals

Jupiter Chemical (Terra)
            Tyner, TN

            Olean, NY

            Fort Madison, IA

            S. Charleston, WV

            Tampa, FL

            Plaquemine, LA

            Woodward, OK

            Woodstock, TN

            Creston, IA

            Clinton, IA

            Louisiana, MO

            Tacoma, WA

            Sterington, LA

            Lake Charles, LA
Kaiser Agricultural Chemicals   Savawnnah,  GA
Mississippi Chemical

Monsanto Co.

NJ Zinc-Gulf and Western
             Yazoo City, MS
             Pascagoula, MS

             Luling, LA

             Palmerton, PA
1000 Tons Per Year






















        Table 1 (Cont'd)

1981 Ammonia Production Capacity

N-Ren Corp. (Cherokee N)        Pryor,  OK

N-Ren Corp. (St. Paul Ammonia)  East Dubuque,  IL
Occidental Chemical Co.

Olin Corporation

Pennwalt Chemical Corp.

Philips Pacific Chemicals

PPG Industries

Reichhold Chemicals

J. R. Simplot

Tennessee Valley Authority

Terra Chemicals

Triad Chemical

Union Oil Co7

U.S.A. Petrochem Corp.

USS Agri-Chemicals

Valley Nitrogen Producers

Vistron Corp.

Vulcan Materials

Wyeon Chemical Co.

            Taft, LA
            Lathrop, CA
            Plainview, TX

            Lake Charles, LA

            Portland, OR

            Beatrice, NE

            Natrium, WV

            St. Helens, OR

            Pocatello, ID

            Muscle Shoals, AL

            Port Neal, LA

            Donaldsonville, LA

            Kenai, AK
            Brea, CA

            Ventura, CA

            Clairton, PA
            Cherokee, AL
            Geneva, UT

            El  Centre, CA

            Lima, OH

            Witchita, KS

            Cheyenne, WY
1000 Tons Per Year



















*    Based  on  future projections from February, 1979 data as  estimated
in ref. [4].


     Next,  using  the  ratio   of  methanol  to  ammonia  production
determined  above,  the nationwide  production  capacity of  methanol
from  converted ammonia  plants can  be  estimated for  1981.   The
nationwide  production for methanol is  about 16.4 million  tons  per
year.  The  specific volume  of methanol is about 7.2 barrels  per
ton,  so  the  annual volumetric production  capacity  would be  118
million  barrels.   On a calender  day  operating  basis,  the  daily
production  would  be about  320,000 barrels.  On  an  energy  basis,
this is equivalent  to a production of  150,000 barrels of  fuel  oil
equivalent  per day (BFOE/D)(based  on  an  energy  value  of  2.11
barrels of methanol per barrel of fuel  oil equivalent).

IV.  Cost

     The  total  capital  cost of this conversion will be  estimated
in  this  section.   To determine these costs, capital  costs will  be
determined  first  for each  converted  ammonia  plant.   The cost  of
each  plant  depends upon  the plant  size.    The 81  U.S.  ammonia
plants vary from  a production of 8,000  tons  per year (or 22  tons
per day) to a production as large  as one million  tons per  year  (or
2,790 tons  per day).[4]  Rather than attempt  to calculate  the  cost
plant by plant, a cost  for  an  average plant size  will be  estimated
for  convenience.   A  straight  average   of  the  81 ammonia  plants,
based  on a  nationwide  production  of   20  million  tons  per  year,
would yield a plant  size  of about 250,000 tons per year,  or  about
700 tons of ammonia  per day.   If  these  were converted to  methanol,
each methanol  plant would have the  capacity  to produce about  550
tons  of  methanol  per  day.   On  an energy  equivalent basis,  this
would amount to 1,990 BFOE/D.

     Now that the  average size plant has been determined,  the  cost
of  converting  an  average-sized ammonia  plant to a methanol  plant
must  be  estimated.  In  section  II above,  it  was determined  that
the  addition  of  the following units would  be necessary when  con-
verting  an  ammonia  plant  to  methanol  production:    a  compression
unit,  two  cryogenic units,  sulfur guard  beds,  and  a  methanol
synthesis   unit.    The   cost  for   these  additional  units   for
converting to this  average  size methanol production plant  is  shown
in  Table  2.  These  costs were  scaled  to a production  of 550  TPD
from plant  sizes found  in current  studies,[5,6,7,8,9] ranging  from
a  production  of  1800 TPD to  75,000 TPD methanol using a  scaling
factor  of  0.75.   This  is  a  common  capital   scaling  factor  for
chemical  producing industries.[10]  Table  2  shows  the  middle  of
the  range of  these  scaled  costs.   The  sum of  these  costs is  $22
million (1981 dollars) per  plant.  In addition,  there are  probably
other  costs involved  when  converting   from  ammonia  to  methanol
production.   Since  these  costs would be difficult  to estimate,  a
contingency factor  of  20   percent  will  be allotted.   Thus,  the
capital  cost  for  the  conversion  units  with  contingency  is  26
million for a 550  TPD plant.   Since there are  approximately  81  of
these  plants  nationwide, the  total cost  to  the  nation  would  be
approximately $2.1 billion.


                             Table 2

                 Cost of Methanol Producing Units
         (Millions  of First Quarter 1981 Dollars, 550 TPD)

Technology/Synthesis                                         Cost*

Synthesis Gas Compression                                     $  1

Two Cryogenic Recovery Units                                  $  4

Sulfur Removal and Recovery/Methanol  Drying                   $  3

Methanol Synthesis                                            $14

       Total                                                  $22
*   Costs  are  the middle  of  the range of  costs  found in  current
literature,[4,5,6,7,8] and are  scaled  to  a methanol production  of
550 TPD (1900 BFOE/D), using a 0.75 capital scaling factor.


     The cost of converting an ammonia plant  should  be  compared  to
the cost of constructing a new natural gas  based methanol  plant  to
observe the  possible  savings  involved.  According to a report  by
ICF,[11] the  cost  of  a  new methanol  plant  using natural gas  as
feedstock  would  be  about  $140  million (in  1981 dollars)  for  a
2,000 TPD  plant.   To  accomplish  an annual production of 16.4  mil-
lion  tons  per  year   (or  the  amount  if  all  ammonia  plants  were
converted  to  methanol production), approximately 22 of these new
methanol plants would be required.  The  total cost of these  plants
would  be  about  $3.1  billion.    This  is approximately  50 percent
higher  than  the  nationwide cost  of  $2.1 billion determined above
for converting the nation's ammonia plants  to  methanol production.

     Thus,  the cost  of producing  methanol  from converted ammonia
plants  is  about  $2.1  billion  nationwide and  appears to be roughly
one-third  less expensive than building  new methanol plants, which
cost  about  $3.1  billion.   Of   course,  in  the  long  run,  final
justification of converting  an   ammonia  plant to methanol produc-
tion as opposed  to building new plants would not  be based  on the
simplified estimate   of  determining capital  costs   in  each  case.
Instead, an  investigation  is  necessary  to  weigh  the economics  of
eliminating  ammonia   production  and  increasing  methanol  produc-
tion.   Such  an  economic  study,  however,  is  beyond  the  scope  of
this report.   This report only  shows that the capital costs for
producing  a  determined  amount  of  methanol  are  reduced  by approx-
imately one-third  if  ammonia  plants are converted  rather  than  if
new methanol plants were constructed.



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