UUnniivveerrssiittyy ooff PPeennnnssyyllvvaanniiaa SScchhoollaarrllyyCCoommmmoonnss Department of Chemical & Biomolecular Senior Design Reports (CBE) Engineering 4-2010 AALLGGAAEE TTOO AALLKKAANNEESS Liane S. Carlson University of Pennsylvania Michael Y. Lee University of Pennsylvania Chukuemeka A.E. Oje University of Pennsylvania Arthur Xu University of Pennsylvania Follow this and additional works at: https://repository.upenn.edu/cbe_sdr Part of the Chemical Engineering Commons Carlson, Liane S.; Lee, Michael Y.; Oje, Chukuemeka A.E.; and Xu, Arthur, "ALGAE TO ALKANES" (2010). Senior Design Reports (CBE). 12. https://repository.upenn.edu/cbe_sdr/12 This paper is posted at ScholarlyCommons. https://repository.upenn.edu/cbe_sdr/12 For more information, please contact [email protected]. AALLGGAAEE TTOO AALLKKAANNEESS AAbbssttrraacctt Once considered infeasible and unviable, recently there has been renewed interest in the development of algae-derived transportation fuels. Currently, there are no commercialized algae to fuel ventures, and much debate is centered on the economic viability of such a process. Research conducted by NASA, among others, has expressed skepticism that terrestrially cultivated algae can ever compete with conventional fuels. The purpose of this project is to evaluate the economic feasibility of an algae-to-fuel venture that incorporates the state-of-the-art technologies available in the open literature. Our challenge is to produce 20 thousand barrels per day of n-alkane product that meets the current diesel fuel specifications. To arrive at a recommendation, separate models were built for algae cultivation, lipid extraction, and lipid processing at a scale necessary to reach this target. This analysis departs from prior studies on two major fronts. First, this analysis considers OriginOil’s new method of lipid extraction instead of conventional hexane extraction. Second, the objective of the lipid processing module is to produce n-alkanes from triglycerides, as opposed to producing FAME biodiesel. The n-alkane product from this process is comparable to petroleum-based diesel fuels. Thus it can be readily incorporated into existing energy infrastructure as a diesel blending stock or as a feedstock for other processing units in the refinery. Our economic analysis shows that an algae-to-fuel venture is profitable if the fuel is sold at $3/gallon, the current price of diesel. However, the commercialization of such a process is difficult due to the large total capital investment. At $2.2 billion, the capital investment of algae cultivation is nearly 40 times that of processing, which results in annual depreciation and fixed costs of nearly half of the revenue. Investors would be hesitant to invest such a large amount of money in an algae cultivation process where there is high uncertainty in the cost requirements. Algae-to-fuel economics can be improved by realizing higher value uses of the algae biomass. Biomass composes of over half of algae product, and their potential uses in pharmaceuticals, chemicals, and biomass power generation far surpass their value as animal feed. Proposed carbon-cap-and-trade programs may bring additional revenue. Thus, any algae-to-fuel venture should seek to optimize the value of its byproducts. Governments can support algae-to-fuel ventures by offering tax credits or mandating a market for renewable fuels, but the benefits of these measures are unclear. Additional analysis should address the uncertainties of various costs and look to reduce capital investment. DDiisscciipplliinneess Chemical Engineering This working paper is available at ScholarlyCommons: https://repository.upenn.edu/cbe_sdr/12 ALGAE TO ALKANES Liane S. Carlson Michael Y. Lee Chukuemeka A.E. Oje Arthur Xu Department of Chemical & Biomolecular Engineering University of Pennsylvania Spring 2010 Faculty Advisors: Dr. Stuart W. Churchill and Dr. Warren D. Seider Project Recommendation by: John A. Wismer, Arkema, Inc. Professor Leonard A. Fabiano Department of Chemical and Biomolecular Engineering University of Pennsylvania 220 South 33rd Street Philadelphia, PA 19104-6393 21 April 2010 Dear Mr. Fabiano, Dr. Churchill, and Dr. Seider, This spring, our design team was presented with the task of evaluating the long term potential of producing biofuels from algae for our client, a venture capital firm interested in alternative energy. The project, suggested by Mr. John A. Wismer of Arkema, Inc., called for the design of an algal cultivation process, a lipid extraction process, and a method processing the lipids into an n-alkane product suitable for transportation fuel. To effectively evaluate the potential of an algae-to-fuel project, the economics of each process was determined and compared to the current price of diesel, which is $3/gallon. The algae cultivation process was modeled primarily after the SimgaeTM Algal Biomass Production System developed by Diversified Energy Corporation and details a simple, cost effective process. The lipid extraction stage was modeled using OriginOil, Inc.’s Single-Step ExtractionTM process. In this process, Quantum FracturingTM, combined with pulses of electromagnetic fields, fractured the algae cell wall to release the lipids. The triglyceride component of the lipid stream was then transported to a petroleum refinery by rail and converted into an n-alkane product using a catalytic hydrotreating process. The analysis indicates that a venture combining all three modules of the supply chain would be profitable. At an n-alkane selling price of $3/gallon and a 15% discount rate, the projected net present value (NPV) of the project is $289,406,000. However, there is great uncertainty in various cost requirements since the technologies are new and unproven. The total capital investment of $2.8 billion, primarily from the algae cultivation process, poses a significant barrier that may discourage investors. The processes design, economic analysis, and recommendations are discussed in more detail in this report. Liane S. Carlson Michael Y. Lee Chukuemeka A.E. Oje Arthur Xu TABLE OF CONTENTS I. INTRODUCTION AND PROJECT CHARTER .................................... 1 A. Abstract ................................................................................................................................... 1 B. Motivation ............................................................................................................................... 1 C. Barriers For Algae Conversion Into Fuel .................................................................................. 2 D. Project Summary: Converting Algae Into Fuel ........................................................................ 3 II. OVERALL CONCEPT STAGE ......................................................... 5 A. Overall Flowsheet .................................................................................................................... 5 B. Market And Competitive Analysis ........................................................................................... 5 C. Customer Requirements .......................................................................................................... 6 D. Transportation Between Modules And Storage ...................................................................... 7 MODULE I: ALGAE CULTIVATION ........................................................ 8 III. CONCEPT STAGE ........................................................................ 9 A. Picking An Algae Strain ............................................................................................................ 9 B. Increasing Lipid Content .......................................................................................................... 9 C. Location Screening ................................................................................................................. 10 D. Picking A Cultivation Process ................................................................................................. 12 E. Optimal Conditions For Cultivation ....................................................................................... 14 F. Proposed Module I Parameters ............................................................................................. 15 Proposed Algae, Nannochloropsis Sp................................................................................ 15 Proposed Location ............................................................................................................ 15 IV. FEASIBILITY AND DEVELOPMENT STAGES ................................. 18 A. Proposed Cultivation Process - Simgaetm .............................................................................. 18 B. General Material Balances ..................................................................................................... 20 Algae Material Balance ..................................................................................................... 20 Multiple Fields .................................................................................................................. 24 i Optimal Conditions For Nannochloropsis Sp. Cultivation ................................................. 24 Cleaning The System – Accumulation Of Biofilm .............................................................. 25 Production Comparisons ................................................................................................... 26 Co Source And Consumption ........................................................................................... 26 2 Nutrient Consumption ...................................................................................................... 28 Oxygen Production ........................................................................................................... 29 C. Land Requirement ................................................................................................................. 29 D. Energy Calculations ............................................................................................................... 30 E. Economics .............................................................................................................................. 30 Capital Costs ...................................................................................................................... 30 Continuous Costs .............................................................................................................. 31 Economic Summary .......................................................................................................... 33 A Glance At Economics: Diversified Energy Algal Biofuels Modeling And Analysis .......... 34 F. Concern With The Simgaetm Analysis: Dilute Exiting Algae Stream ....................................... 36 G. Other Important Considerations ........................................................................................... 36 MODULE II: LIPID EXTRACTION ......................................................... 37 V. CONCEPT STAGE ...................................................................... 38 A. Lipid Extraction ...................................................................................................................... 38 B. Conventional Lipid Extraction ................................................................................................ 38 C. OriginOilTM Extraction Process .............................................................................................. 39 VI. FEASIBILITY AND DEVELOPMENT STAGES ................................. 40 A. Process Design and Material Balances .................................................................................. 41 B. Process Description ............................................................................................................... 43 C. Energy Balance and Utility Requirements ............................................................................. 45 D. Equipment List and Unit Descriptions ................................................................................... 47 E. Specification Sheets ............................................................................................................... 48 F. Operating Costs and Economic Analysis ................................................................................ 51 ii MODULE III: LIPID PROCESSING ........................................................ 53 VII. CONCEPT STAGE ...................................................................... 54 A. Preliminary Process Synthesis ............................................................................................... 54 B. Facility Design ........................................................................................................................ 55 C. Assembly of Database............................................................................................................ 56 D. Bench-Scale Laboratory Work ............................................................................................... 57 VIII. FEASIBILITY AND DEVELOPMENT STAGES ................................. 58 A. Process Flow Diagram and Material Balances ....................................................................... 59 B. Process Description ............................................................................................................... 64 C. Energy Balance and Utility Requirements ............................................................................. 67 D. Equipment List and Unit Descriptions ................................................................................... 68 E. Specification Sheets ............................................................................................................... 75 F. Fixed-Capital Investment Summary ....................................................................................... 98 G. Other Important Considerations ......................................................................................... 100 H. Operating Costs ................................................................................................................... 101 IX. OVERALL ECONOMIC ANALYSIS .............................................. 105 Fixed-Capital Investment .......................................................................................................... 105 Variable Costs ........................................................................................................................... 106 Fixed Costs ................................................................................................................................ 107 Sensitivity Analysis .................................................................................................................... 107 Other Important Considerations .............................................................................................. 107 Carbon Credits ............................................................................................................... 107 Processing Costs .............................................................................................................. 108 Government Subsidies and Incentives ............................................................................ 109 X. CONCLUSIONS AND RECOMMENDATIONS ............................. 110 iii ACKNOWLEDGEMENTS ................................................................... 111 REFERENCES ................................................................................... 112 APPENDIX ....................................................................................... 115 I. Problem Statement ................................................................ 116 II. Module I Calculations ............................................................ 119 Cost and Make Up of the Nutrients .......................................................................................... 119 Determination of Algae Composition ....................................................................................... 120 Calculation of CO Enriched Air ................................................................................................ 121 2 Production Conversions ............................................................................................................ 122 III. Module II: Conventional Energy Requirements ...................... 123 IV. ASPEN PLUS Simulation ......................................................... 124 ASPEN Flowsheet of Hydrotreating Process ............................................................................. 125 ASPEN Simulation Results ......................................................................................................... 126 V. Module III: Equipment Design Calculations ............................ 148 VI. Profitability Analysis Spreadsheet .......................................... 171 VII. Material Data Safety Sheets (MSDS) ...................................... 179 iv