Industry giants and experts offered insight into whether carbon dioxide (CO2) supply was keeping up with demand during the first two sessions at gasworld’s North American CO2 Summit here in Indianapolis, Indiana.
A sell-out event of 160 delegates from 14 different countries heard presentations covering carbon dioxide (CO2) sourcing and reliability, future sourcing and supply before lunch at the Conrad Hotel.
After introductions from gasworld Publishing Director Martyn Hammond, Indiana Oxygen owner Wally Brant delivered an opening keynote presentation stressing the importance of the CO2 supply chain as well as outlining the history of his 104-year-old business.
Chris Ebeling, Executive Vice-President of Sales & Marketing, US Bulk at Messer, focused on investing in a more strategic supply chain. Ebeling covered customer expectations, demand drivers, economic influences, sourcing considerations and Messer’s approach.
“The demand for CO2 is increasing,” Ebeling said.
“Customers think CO2 is like electricity, and they are not thinking about what happens if the perfect storm happens. We remember 2015 – it was very painful when a number of plants went down at the same time.”
“The biggest shift in the market is the fresh-not-frozen mentality. We see increasing demand for home delivery groceries and CO2 is consumed with that. We see increasing demand for dry ice blasting, stunning, blending, freezing and chilling. The food industry itself is changing, people’s tastes change quicker and it’s creating a need for a flexibility of operation.”
Messer is expanding its network capacity with a 400 tpd CO2 plant set to go into Keyes, California.
“I stress the importance with the client, onsite storage – does the volume match your evaluation? – and coordination, we make sure we let people know about the issues when they arise and prepare them for things they can do,” Ebeling said.
Ebeling’s point that capacity demand is not increasing to keep up with demand was echoed by Maura Garvey, of Intelligas Consulting and a member of the gasworld Editorial Board.
In her overview of the North American CO2 market, Garvey explained the North American market share and demand for CO2, with food attributing for 70% of the demand and USCO2 demand at 10.2 million tonnes per year (mtpy). In Canada, 78% of CO2 is sourced from ammonia, ethanol and hydrogen/refinery.
“The major industrial gas companies own 87% of the US CO2 nameplate capacity. Messer has come out as a very strong number three after the divesting of Linde’s assets. Linde plc still retains number one spot.”
“The sourcing has grown by almost 1%, and sourcing is seeing a shift towards ethanol and away from hydrogen/refinery. Supply is not keeping up with demand. CO2 demand is estimated to grow at 2.5% per year to 11.6mtpy. We have to support demand growth, we have to plan for four 400 tpd plants to support growth by 2024.”
The Summit was taken south of the border by Miguel Wheelock, owner of AOC Mexico, who educated attendees on CO2 supply in Mexico. Wheelock touched on the CO2 shortage to hit Mexico in 2018, and explained the status of the capacity there: 960 tpd Praxair/Linde; 430 tpd CO2 Liquid, 600 tpd Cryoinfra/Air Products, for a total capacity of 1915 tpd.
In Mexico, market growth is at 5% CAGR for the last five years and demand is 1100 tpd.
“If we have a problem with natural gas, we have a headache in Mexico,” Wheelock said.
“We don’t have the capacity to bring more natural gas to Mexico.”
Carbon capture is getting increasing attention and Brett Henkel, of Canadian firm Inventys, kicked off session two with technical insight into CO2 capture from solid sorbent structured laminates. Inventys is busy commercialising its technology as the appetite to reduce CO2 emissions increases.
“Cement, steel, chemicals make up 16% of global CO2 emissions,” Henkel said.
“We are targeting CO2 from industrial sources that do not have alternative ways to capture the CO2. We concentrate on how we are going to separate the CO2 from the nitrogen. It’s really difficult, and it has been the biggest challenge.”
Inventys is in the process of commissioning a 30-tonnes-per-day pilot plant at a Husky Energy site in Saskatchewan, Canada. The project is the world’s first pilot-scale plant using structured adsorbents to capture carbon from a once-through steam generator for use in heavy oil recovery.
“We are very close to being there, and we are proving our technology in the field,” Henkel said.
“The International Energy Agency says that we need to store billions of tonnes of CO2 by 2040. The scale of what people are talking about is what the public and frankly the industry don’t understand. I’m hopeful but it’s a big challenge. We want to have the same industries we have today to exist tomorrow, so we have to figure out a business case that reduces CO2 emissions.”
Sam A. Rushing, of Advanced Cryogenics and regular gasworld contributor, explored CO2 sourcing from natural wells. Rushing highlighted the US locations of the natural gas reserves and pipeline sourced by-product operations. He also listed the merchant CO2 plants from natural sources in the US midsouth and west.
“Natural sources offer unique capabilities versus by-product source operations,” Rushing said.
“Their saving graces are when these other sources go down. They are not reliant on the by-product source for raw gas feedstock like ammonia, ethanol.”
“The reliability factor of natural sources is high, if we are faced with a crisis with ethanol possibly, or in the past with ammonia, these sources help supplement those losses. Raw gas quality from natural sources tends to be substantial. I think it’s a great source type. It’s an old source too, and will be here for many years to come.”
John ‘Buzz’ Campbell, President of Intelligas Consulting, rounded off session two with an entertaining presentation on moving CO2 to demand hubs via trucks and transport. Campbell’s section was well received by many of the distributors in attendance that included Arc 3 Gases, Cee Kay Suppy, Indiana Oxygen Company, KAG Merchant Gas Group Linde, Airgas, Air Liquide, AWG, Linde, MATHESON Gas, MacCarb, Messer, Mississippi Welders Supply, nexAir, OXARC, Reliant Gases, Roberts Oxygen, Sutton-Garten, S.J. Smith, Syoxsa, Welders Supply Company and Western Gas Company.
Campbell drew on his 57 years of CO2 experience including in fleet management and all parts of industrial gases trucking operations. Campbell focused on increasing trucking efficiency, reducing transportation costs and for the interface between truck deliveries and customer based storage.
“The bête noire of distribution is the storage of tanks,” Campbell said.
“The biggest problem in driving costs down in microbulk CO2 and others was a more adequate inventory to maximise volume of delivery in a minimum distance. The best metric to maintain and measure improvement in distribution costs is through GPAD.”
Campbell outlined the key metrics in managing cost per tonne of liquid CO2 delivered by microbulk and said microbulk cost per pound was $0.076, or $153 per tonne.
“The largest impact on inefficient distribution costs is the tank capacity and management of inventory with maximum delivery volumes,” he said.
The summit will continue at around 2pm local time after lunch and dedicated networking time around the exhibition area, which has 25 table tops.
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A full review of the conference will be published in the forthcoming editions of both gasworld and gasworld (US) magazine.