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Co2e emissions abatement costs of reducing natural gas flaring in Brazil by investing in offshore GTL plants producing premium diesel

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  • Castelo Branco, David A.
  • Szklo, Alexandre S.
  • Schaeffer, Roberto

Abstract

This study evaluates the possibility of installing an offshore gas-to-liquids (GTL) plant in Brazil to reduce Natural Gas (NG) flaring, curb carbon dioxide equivalent (CO2e) emissions and produce premium diesel. CO2e emissions abatement costs were estimated by comparing two alternatives. The first alternative (baseline) considers that the volume of NG flared will not be reduced. Low-sulfur fuels (diesel and naphtha) will be obtained by investing in treatment units in Brazilian refineries. These are hydrotreating units for unstable compounds and hydrodesulfurizer units for fluid catalytic cracking (FCC) naphtha. Currently in Brazilian refineries, without any investment, the lower-quality streams that should be removed from diesel and gasoline pools to comply with higher specifications are light-cycle oil and FCC naphtha, respectively. The second alternative considers an offshore microchannel GTL plant producing synthetic crude oil, or syncrude. The upgrading of this syncrude is done by a mild-hydrocracking unit. This alternative allows the production of low-sulfur diesel, reducing gas flaring and co-producing high-quality naphtha. The results show that CO2e emissions abatement costs of offshore GTL in Brazil should range between negative US$ 2.00 and positive 80.00/tCO2e. Nevertheless, the typical scenario shows an average figure of US$ 37.00/tCO2e abated.

Suggested Citation

  • Castelo Branco, David A. & Szklo, Alexandre S. & Schaeffer, Roberto, 2010. "Co2e emissions abatement costs of reducing natural gas flaring in Brazil by investing in offshore GTL plants producing premium diesel," Energy, Elsevier, vol. 35(1), pages 158-167.
    • Handle: RePEc:eee:energy:v:35:y:2010:i:1:p:158-167
    DOI: 10.1016/j.energy.2009.09.006
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    4. Rodrigues, A.C.C., 2022. "Decreasing natural gas flaring in Brazilian oil and gas industry," Resources Policy, Elsevier, vol. 77(C).
    5. Fernanda Guedes & Alexandre Szklo & Pedro Rochedo & Frédéric Lantz & Leticia Magalar & Eveline Maria Vásquez Arroyo, 2018. "Climate-Energy-Water Nexus in Brazilian Oil Refineries," Working Papers hal-03188594, HAL.
    6. Borba, Bruno S.M.C. & Lucena, André F.P. & Rathmann, Régis & Costa, Isabella V.L. & Nogueira, Larissa P.P. & Rochedo, Pedro R.R. & Castelo Branco, David A. & Júnior, Mauricio F.H. & Szklo, Alexandre &, 2012. "Energy-related climate change mitigation in Brazil: Potential, abatement costs and associated policies," Energy Policy, Elsevier, vol. 49(C), pages 430-441.
    7. Höök, Mikael & Fantazzini, Dean & Angelantoni, André & Snowden, Simon, 2013. "Hydrocarbon liquefaction: viability as a peak oil mitigation strategy," MPRA Paper 46957, University Library of Munich, Germany.
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