United States Air and Radiation Draft Environrr Agency &EPA Environmental Protection 6202J November 1992 EPA Coalbecl Methane Outreach Program Technical Options Series Coal Mine Methane Use in Methanol Production Sand Creek Chemical Plant in Commerce City, Colorado (uses conventional natural gas to produce methanol) A Viable Substitute for Conv ~ The methanol market is robust and growing worldwide ~ Methane from coal mines often costs less than conventional natural gas ~ The use of coal mine methane reduces greenhouse gas emissions ------- Coal mine methane may be an attractive alternative to conventional natural gas for small methanol plants The cost of coal mine methane is often less than conventional natural gas Why Consider Coal Mine Methane in Methanol Production? Methanol is a key component of many products, including MTBE (used in reformulated gasoline), methanol and gasoline blends such as M85 for flexible fuel vehicles, formaldehyde resins (widely used in the housing industry), and acetic acid, a major raw material in the chemical industry. MTBE (the second largest methanol market, after formaldehyde) is the fastest growing segment of the methanol market worldwide, due to its value as a clean burning fuel additive. The United States is the world's largest MTBE user, consuming approximately 40% of all methanol used for MTBE production on a global basis. Most of the world's production of methanol uses natural gas as a feedstock, and natural gas typically represents the most important cost component. Many countries produce methanol, although production tends to be concentrated in areas where natural gas is abundant. For safety reasons, gassy underground coal mines must drain methane from their coal seams. Most coal mines vent this methane to the atmosphere, which not only represents the loss of a valuable fuel source, but also contributes to global warming, as methane is a potent greenhouse gas. However, a growing number of mines in many parts of the world recover the drained methane for sale to pipelines, or for heat or electricity generation. To date, no methanol producers have used coalbed methane, but it is a potential alternative feedstock in areas that mine gassy coal. Coal mines do not produce enough methane to fuel large methanol plants, but one or more very gassy mines typically produce enough methane to fuel a small (25-30 million gallons/year) methanol plant. Alternatively, smaller (3-5 million gallons/year) mobile methanol plants currently used at offshore oil rigs may be a potential option for use at coal mines. Some Facts About Methanol Production... • 100 ft3 (2.83 m3) of methane will produce 1 gallon (3.8 liters) of methanol. Production costs are $US 0.35-0.45/gallon ($US 0.09/liter), assuming natural gas prices of $2-$3/mcf ($0.70 - $1.06/thousand m3). At $2/mcf, natural gas typically accounts for about half of production costs at small plants. Typical 1997 methanol prices are around $US 0.55-0.70/gallon ($US 0.15- 0.18/liter). Methanol prices can be volatile. Gassy mines are often located near methanol markets, potentially reducing transportation costs. Small plants produce 25-30 million gallons (95-114 million liters) per year. Methane requirements for small plants range from 7-8 million ft3 (200-226 thousand m3) per day. The market for methanol is increasing worldwide Startup costs for a small plant are about $US 1.33 million per million gallons of annual plant capacity ($US 40 million for a 30 million gallon/yr plant). Gas quality should be at least 89% methane; up to 1% oxygen; and up to 10% CO2 (a small amount of CO2 is actually beneficial). ------- How is Methane Converted to Methanol? The first step in producing methanol is converting methane to syngas, either by steam reforming methane and carbon dioxide, or by catalytic conversion of methane. (Conventional technologies for this part of the process can be expensive; however, several companies are developing new technologies to reduce this expense.) Next, a catalytic process converts syngas to crude methanol. Finally, distillation purifies the crude methanol to chemical grade. METHANOL IH- SIBWI WATER Converting syngas to methanol For More Infor Changing energy markets worldwide are prompting producers of coal and other fuels to look at new markets for coalbed methane. Coalbed methane is a potential feedstock for methanol and other products. Use of coalbed methane is also beneficial in that it also reduces emissions of this greenhouse gas to the atmosphere. To obtain more information about methanol production, and uses of methanol for transportation, contact: Greg Dolan phone: (202) 467-5050 Communications Director fax: (202) 331-9055 American Methanol Institute e-mail: AmMethlnst@aol.com 800 Connecticut Avenue, NW, Ste. 620 http://www.methanol.org Washington, DC 20006 Or contact the U.S. EPA's Coalbed Methane Outreach Program for information about this and other profitable uses for coal mine methane: Coalbed Methane Outreach Program U.S. EPA 401 M Street, SW (6202J) Washington, DC 20460 USA (202) 564-9468 or (202) 564-9481 Fax: (202) 565-2077 e-mail: fernandez.roger@epa.gov schultz.karl@epa.gov http://www.epa.gov/coalbed The mention of products or services in this l=D A c O A L B E D M E THAN E O U T R E A C H P R O £ R A M study does not constitute an endorsement by ------- |