Biofuels Power Corp. plans to build a small-scale plant to convert natural gas to synthetic crude on a former power plant site south of downtown Houston as it looks to capitalize on abundant supplies of cheap natural gas, the company announced Monday.
The gas-to-liquids plant is a pilot project, the first step in the Humble-based company’s plans to build several small plants at oil fields across the U.S. to capture and convert natural gas now stranded at well sites that don’t have processing or transportation infrastructure to carry the gas to market.
Advances in hydraulic fracturing and horizontal drilling have unlocked vast quantities of natural gas from dense rock formations, but producers have to burn off stranded gas for lack of a way to transport and sell it.
With its demonstration project, Biofuels Power Corp. hopes to show that small-scale gas-to-liquids plants are commercially viable alternatives for companies curtailing or stopping natural gas production because it’s too expensive to expand and build infrastructure to gather, process and transmit natural gas.
New legislation regulating flaring make such projects even more attractive, Biofuels Power Corp. said.
“With an abundant natural gas resource base, future gas-to-liquids developments like this could fill a need in the energy industry for decades to come,” Eric Gadd, chief commercial officer, said in a statement.