South African Petroleum Firm Plans Massive $8b U.S. Plant

South African petrochemicals giant Sasol has chosen a location in south-western Louisiana as the site for what could be the first plant in the US to produce gas-to-liquid (GTL) transportation fuels and other products.

Sasol will embark on a feasibility study to evaluate the viability of a GTL venture in Calcasieu Parish over the next 18 months, and will consider two options – a two-million tons per annum and a four-million tons per annum facility.

The potential GTL complex would entail a capital investment of approximately US$8-billion to $10-billion, and could create up to 850 permanent positions and up to approximately 5500 jobs during peak construction periods.

Advancing energy independence

If all proceeds as planned, construction is expected to start in 2013, and the complex would be built in two phases that, on completion in 2018, would process approximately four-million tons of products per year, with a maximum capacity of 96000 barrels a day.

“We believe Sasol’s proprietary GTL technology can help unlock the potential of Louisiana’s clean and abundant natural gas resources and contribute to an affordable, reliable and high quality fuel supply for the United States,” said Sasol new business development director Ernst Oberholster.

He was speaking at a press conference in the US together with Louisiana Governor Bobby Jindal last week.

“GTL fuels are an important part of the energy mix because they can advance energy independence in a way that is both cost-efficient and environmentally friendly.”

First of its kind

The GTL complex would be the first of its kind built in the United States, with Sasol converting natural gas into synthetic gas and then converting the synthetic gas into premium diesel fuel and related products.

In addition, unlike other proposed alternatives to conventional petroleum-based fuels, GTL fuel is used in existing vehicles and fuel delivery infrastructure without modifications.

“Sasol has selected Calcasieu Parish as their preferred location in the US for one of the largest industrial projects in Louisiana history,” said Jindal. “This is great news for Southwest Louisiana and our entire state.”

This is the second “first of a kind” announced by Sasol in the US in less than a year – In December 2010, Sasol announced the world’s first Ethylene Tetramerization Unit, also to be built in Calcasieu Parish.