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US GTL Holds Little Allure for Chevron Chevron does mention problems with dry gas development.... Some companies see gas-to-liquids (GTL) as a promising means of converting the US’ massive gas resources into vehicle fuel, but Chevron has little interest in GTL projects in the US. Chevron is a large player in GTL. The company is a partner in the Escravos GTL plant in Nigeria, which will convert 325 million cubic feet of natural gas per day into 33,000 barrels of liquids, mostly synthetic diesel, and is scheduled to come onstream later this year. Commissioning is underway, but “it’s a complex plant and the commissioning activity will really go on for the bulk of this year,” said Chief Financial Office Pat Yarrington during the company’s first-quarter 2013 earnings call on Friday. The flood of cheap gas unleashed on the US market by companies drilling in gas shales and other unconventional formations has led some firms, such as South Africa’s Sasol, to examine possibilities for GTL in the US. Following a feasibility study, Sasol decided to proceed with front-end engineering and design for a plant in Louisiana, which would be the US’ first. Chevron has no such aspirations. “GTL would not rank high in terms of our project alternatives for US natural gas,” Yarrington said. The company has substantial US gas holdings, such as a large position in the Marcellus shale obtained through its acquisition of Atlas Energy for $4.3 billion – including $1.1 billion in debt – announced in November 2010. But the company is keeping a tight rein on spending in US gas, holding off on an output ramp-up in anticipation of market improvements that will brighten the outlook for returns on dry gas drilling.“We have really restricted all of our dry gas production to minimum amounts, principally in the Marcellus area,” said Yarrington. |
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Msg # | Subject | Author | Recs | Date Posted |
183 | Re: US GTL Holds Little Allure for Chevron | Odialt | 0 | 8/12/2013 10:26:12 AM |