Royal Dutch Shell plc is in the early stages of developing “large-scale” natural gas-to-liquids (GTL) projects in the United States that would mirror worldwide projects, an executive said last week in Qatar.

Speaking at the World Petroleum Congress in Doha, Executive Vice President Andy Brown said Shell was “looking for places where gas is cheap and [crude oil] products are expensive…Clearly, the U.S. is something we’re looking at.”

Brown’s comments echoed remarks by CEO Peter Voser and CFO Simon Henry earlier this year (see NGI, Oct. 31; Aug. 1).

Any domestic GTL plants would have to be underpinned by long-term low North American gas prices, said Brown. The United States appears to be a good fit for a big GTL plant now but Shell has to be convinced that market conditions would remain favorable for decades.

“Our U.S. ambition is at a very early stage,” said Brown. “We tend to look at large scale when we look at GTL…Other companies look at small-scale GTL but that’s not our niche.”

Shell is only keen on large-scale projects that would match its $18 billion Pearl GTL plant in Ras Laffan Industrial City in Qatar, he added. Pearl uses gas from the country’s North Field to manufacture high-quality base oils and other GTL products; gas began flowing through a subsea pipeline offshore Qatar earlier this year (see NGI, March 28).

The first phase of Pearl, which is the largest GTL facility of its kind in the world, now is producing at close to full capacity; the second stage started up over the weekend. Pearl remains on track to reach full production by mid-2012, said Brown.

Voser last Monday signed a heads of agreement with Qatari officials that sets the scope and commercial principles to develop a world-scale petrochemicals complex in Ras Laffan Industrial City. The agreement follows the conclusion of a joint feasibility study conducted by Shell and its partner, state-owned Qatar Petroleum.

Under consideration by the partners is a steam cracker, with feedstock coming from natural gas projects in Qatar; a monoethylene glycol plant of up to 1.5 million tons a year using Shell’s proprietary OMEGA (Only MEG Advantaged) technology; 300 kilotons a year of linear alpha olefins using Shell’s SHOP (Shell Higher Olefin Process); and another olefin derivative.

The complex would produce “cost-competitive petrochemicals products to be marketed primarily into Asian growth markets.” Qatar Petroleum would have an 80% equity interest while Shell would hold the remaining stake.

©Copyright 2011Intelligence 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.