Royal Dutch Shell plc is readying the launch of natural gas-to-liquids (GTL) business in the United States, a company executive said in Houston on Thursday.

For several months top executives have touted Shell’s plans to develop a large-scale NGL project in the United States that would mirror worldwide facilities (see NGI, Dec. 12, 2011). Pearl GTL in Qatar, the largest GTL plant ever built, is a partnership between Shell and Qatar Petroleum, which sold its first commercial shipment of GTL gasoil in June (see NGI, March 28, 2011).

Shell Oil Co. President Marvin Odum said a U.S. project should be a foregone conclusion, given low natural gas prices.

“With very low natural gas prices, we have a market that still has to import much of its liquid fuels,” Odum said at the annual meeting of the Academy of Medicine, Engineering and Science of Texas. “It’s high time to do something like that in the U.S.”

Odum said the company is working on more efficient ways to find and produce oil and gas by using new techniques that he said “can be described in highly technical terms, like ‘really cool.'” For example, he said Shell and HP are working on tiny nanotechnology motion sensors, “a thousand times more sensitive than those in the Wii electronic game — to create sharper pictures of underground rock formations.”

Shell also has new floating liquefied natural gas technology under way that includes “vessels six times the size of the biggest aircraft carriers, that can reduce the volume of gas by a factor of 600 and send it on its way to markets anywhere in the world.”

Replacing “any meaningful fraction of today’s fossil fuel system with alternatives will require major technological breakthroughs, investments, infrastructure changes, public education and intelligent policy frameworks,” said Odum. “Most current projections show that roughly 30% of our energy will come from alternatives to oil and gas by the middle of this century. Frankly, I think that figure ought to be much higher. But just as frankly, I don’t yet see how we get there.

“So we continue to work on all fronts, making sure that we don’t sacrifice the best solutions available today to the ideal solutions we imagine for tomorrow. We continue to work on getting a few steps closer to that ideal energy system nature designed into the human cell.”

One of the main reasons that North America today is swimming in gas reserves is the pioneering work by Mitchell Energy & Development Corp. and its revered founder, George Mitchell. He was honored at the academy meeting and although he didn’t attend in person, he made some remarks to the audience via a video presentation.

Mitchell, 92, recalled the early naysayers about his company’s early work in the Barnett Shale, which combined hydraulic fracturing, a decades-old technique, with horizontal drilling.

Mitchell’s company spent years before the combination technology proved its worth. Devon Energy Corp. was an early believer; it bought Mitchell’s energy arm in 2001 for $3.1 billion and with it acquired what was then the “only” true producing shale in the country (see NGI, Aug. 20, 2001).

On a historical note, together Devon and Mitchell during 2Q2001 produced about 1.4 Bcf/d of natural gas in the United States, which at the time positioned the merged company as the second largest independent gas producer behind Anadarko Petroleum Corp.

Since 2002 Devon has drilled nearly 5,000 wells into the Barnett Shale, yet it still has about 7,500 remaining drilling locations. Use of fracturing technology has helped Devon increase its Barnett production from 200 MMcfe/d 10 years ago to about 1.2 Bcf/d.

“The whole landscape has changed,” Mitchell told the audience. “They kept telling us we were wasting our time, and now it has really caught fire all over the world.”

©Copyright 2012Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.