1 shell

Shell Global Solutions

The Future of Transportation FuelsThe Future of Transportation Fuels

Colin ChinColin Chin

22nd November 2006, Jakarta

The 1st Indonesia Fuel and Lubes Conference and Exhibition 2006

ContentContent

• Changes effecting fuel and vehicle technology

• Latest in conventional fuels

• Diesel

• Gasoline

• Emerging Fuels

• Bio fuels

• X-to-Liquid (GtL, BtL, CtL)

• Hydrogen

• Conclusions

changes to automotive technology and fuels are required to meet sustainability challenges

• ‘Sustainable mobility’ - maintaining mobility while reducing local and global environmental impacts

• Economic and social sustainability criteria also need to be met

• Consumer acceptance a challenge.

Challenges of increased mobilityChallenges of increased mobility

Global Issues & EU Vehicle/Fuel responsesGlobal Issues & EU Vehicle/Fuel responses

0.14

0.08

0.05

0.025

00.020.040.060.080.1

0.120.140.16

PM (g

/km

)

Pre1992

1992 1996 2000 2005 2008/9

50002000

500 350

50

10

1

10

100

1000

10000

Die

sel S

ulph

ur(p

pm,w

)

PreEuro 1

Euro 1 Euro 2 Euro 3 Euro 4 Euro 5

Environmentalissue

Technologyissue

1992

1996

2000

2005

2008/2009

Euro 5

Ozone/NOxParticle no.Global Warming

NOx Particle mass & no.

2012/2013

Euro 1

Acid rain Lower SOx

Euro 2

Acid Rain Lower SOx

Euro 3

Ozone NOx/HC

Euro 4

OzoneParticlesGlobal warming

NOxLower PM

Euro 6

Global Warming?

?

FirstOxycats

BetterOxycatsCe traps

Ba NOxtraps

CRT

In many developed markets, significant progress has already beenIn many developed markets, significant progress has already beenmade reducing local emissions.made reducing local emissions.

Future challenge: reduce CO2 while maintaining low regulated emissions

0

20

40

60

80

100

120

140

1985 1990 1995 2000 2005 2010 2015

Em

issi

ons,

% o

f 199

5 le

v

CONOxPM-dieselVOCBenzeneSO2CO2

Source : European Commission

COCO22

…… due to due to improvements in improvements in conventional vehicles conventional vehicles and fuelsand fuels

Focus is shifting to Focus is shifting to Greenhouse Gases Greenhouse Gases (GHG)(GHG)(global warming)(global warming)

a view of the future -not a forecast

0

10

20

30

40

50

60

70

80

90

100% of New cars

Diesel (inc Bio-diesel/GTL)

Gasoline (inc Ethanol)

Hydrogen

2000 2010 2020

LPG/CNG

Hybrid

Naphtha/Methanol

conventional liquid fuels will continue to dominate for a long time to come

There is no single Future Fuels SolutionThere is no single Future Fuels Solution

• The next 20-30 years will see a wider range of vehicle technologies and fuel types, especially in developed markets

Thermodynamic Efficiency/Reduced Emissions

Purc

hase

/mai

nten

ance

co

sts

GM, DaimlerChrysler

Daimler/Chrysler, VW/Audi, Peugeot/Citroen

MitsubishiVW/Audi

Toyota, Honda,Subaru

GasolineEngine

Fuel Cell Vehicles

Diesel Engine

HCCI EngineHybrid

Gasoline Engines

Hybrid Diesel Engines

Highly OptimizedDiesel Engines

Direct InjectionGasoline Engine

Technology Trend

Improved Fuels enable more Efficient and lower Emissions Engine Improved Fuels enable more Efficient and lower Emissions Engine TechnologiesTechnologies

Shell Global Solutions

Latest developments in Conventional FuelsLatest developments in Conventional Fuels

1. Diesel1. Diesel2. Gasoline2. Gasoline

More than 50 years of diesel fuel innovationMore than 50 years of diesel fuel innovation

Shell’s international experience in the area of fuel development and is well recognized as being of World Class standard

Shell & Audi made history being the first to win 24hrs LeMans race with a diesel car powered by Shell V-Power Diesel.

Shell Diesel Shell Diesel –– Performance in a DI DieselPerformance in a DI Diesel

Scanning electron micrographs of direct injection light duty fuel injector holes showing lower deposits with detergent fuel (applicable to modern light vehicles, taxis and passenger cars)

Deposits controlled Deposits built up

The effect of dirty fuel on injection equipment is The effect of dirty fuel on injection equipment is clearly clearly and quickly and quickly visiblevisible

Comparison of DI injector cleanliness

Dirty fuelClean fuel

Shell Global Solutions

Latest developments in Conventional FuelsLatest developments in Conventional Fuels

1. Diesel1. Diesel2. Gasoline2. Gasoline

Higher Octane for better efficiency Higher Octane for better efficiency

• Octane quality is still the most important fuel property for gasoline engines.

• Performance, economy and CO2 emissions would all benefit from higher octane quality for modern engines.

• Most engine designers outside North America would like to see higher octane fuels, but with no increase in aromatics, olefins or use of alcohols.

• There are substantial performance benefits in many vehicles fromoperating on high octane (98 RON or higher) fuels.

• The most recent “Optimum Octane” studies show that the optimum has increased, and the refining energy and CO2 penalties from higheroctane fuels are small (though the cost may be substantial).

Higher Octane to reduce vehicle COHigher Octane to reduce vehicle CO�� emissionsemissions

• Higher RON gives more power and fuel efficiency because of better anti-knock quality.

• 37 European and Japanese SI cars tested so far.

• Future engines will require high RON gasoline.

32.00

33.00

34.00

35.00

36.00

37.00

38.00

39.00

40.00

85.0 90.0 95.0 100.0 105.0 110.0 115.0

OI=2.1RON -1.1MON

Ave

rage

Pow

er a

t the

whe

els,

kW 98.2/94.7

98/86.9

95.6/85.8

91.1/89.7

90.2/81.4

Higher Octane protects EnginesHigher Octane protects EnginesDamage caused by insufficient OctaneDamage caused by insufficient Octane

Damage starts at edgeof piston furthest fromsparkplug

High heat transfer to the piston can causelocal melting and burningleading to catastrophic engine failure

Clean Engines for low Emissions and optimum PerformanceClean Engines for low Emissions and optimum Performance

• Clean inlet valves allow better flow of air and fuel into the combustion chamber

• This optimizes engine power

• Reduces fuel wastage

• Improves fuel efficiency

• Makes engines run smoother

• Reduces emissions

Cle

an v

alve

DIR

TY v

alve

Shell Global Solutions

New FuelsNew FuelsBioBio--DieselDiesel

EthanolEthanolShell XTLShell XTL

Overview of bioOverview of bio--componentscomponents

• Shell is the largest blender of 1st generation transport bio-fuels.

• Commercial 2nd generation bio-fuels plants are under construction

Gasoline Diesel

Food crops1st generationEthanol

Sweet cornSugar beet

wheat

advancedbiofuelsWaste

Eco-et

hanol

Enzymatic hydrolysisEco-ethanol ®

Bio-ester

s

RapeseedSoya

Sunflower

Bio-diesel

Conversion

BTL

Shell Global Solutions

Fatty Acid Methyl Esters (FAMEs) or (BioFatty Acid Methyl Esters (FAMEs) or (Bio--diesel)diesel)

RME (Europe) –– rapeseed methyl esterrapeseed methyl ester•approx. 2 million diesel vehicles now use RME and RME blends

•key producers: France (RME-5) & Italy, Germany & Austria (RME-100)

SME (USA)-- soy methyl estersoy methyl ester•use increasing since registered with EPA

•mostly SME-100 and SME-20 POME + CME (Far East)

--palm oil / coconut methyl esterspalm oil / coconut methyl esters

-trials and research underway for use of POME in Malaysia & Thailand and CME in Philippines

Common FAMEsCommon FAMEs

fuel consumptionincreases up to 20%with FAME-100

re-fuelling times& foamingsimilar to AGO

negligible impact for 5% blends

reduced acceleration &lower average speed

for FAME-100

less visible smokeexhaust odour OK

(up to 30%)

fuel additive compatibility –increased deposits ?

material compatibility – in some older vehicles

The Impact of FAMEs on vehicle performanceThe Impact of FAMEs on vehicle performance

Shell Global Solutions

BioBio--ethanol (gasoline)ethanol (gasoline)

fuel consumptionIncreases 3% with10% EtOH

negligible impact for 5% blends

Drivability concernsengine tuning with

>20% required

No impact onemissions with3-way catalyst

fuel additive compatibility –increased deposits ?

material compatibility – in some older vehicles

The Impact of Ethanol (EtOH) on vehicle performanceThe Impact of Ethanol (EtOH) on vehicle performance

Standard bio-ethanol production steps

Ethanol from nonEthanol from non--food sources: IOGENfood sources: IOGEN

Straw- hemi-cellulose- cellulose- lignin

Pre-treatment

Enzyme production

Steam generation

Hydrolysis Fermentation Distillation

Lignin

enzymes

C5+C6 sugars ethanol

Simplified Process

Iogen’s EcoEthanolTM facility in Ottawa, Canada

ethanol/gasoline blends

Use non-food biomass to produce ethanol for blending into conventional

gasoline to reduce CO2 emissions

www.bio-fuels.dk

BioBio--Fuels are RealityFuels are Reality

• Shell has successfully implemented “Gasohol” in Thailand.

• “Gasohol” is a blend made from 10% Ethanol and 90% gasoline

• “Gasohol” has a tax advantage resulting in 7% lower retail price.

• Current market share of “Gasohol” is about 50% of Thai ULG95 market

Shell Global Solutions

Shell XtLShell XtLX=X= GGasas--X= X= BBiomassiomass-- tto o LLiquidiquidX =X =CCoaloal--

Identical Products

Natural Gas

GTL

Biomass

CoalFischer-Tropsch process

Syngas

BTL

CTL

Shell Gasification

Process

Shell Coal Gasification

Process

Gasifier

XTL XTL –– Synthetic fuel from gas, coal and biomassSynthetic fuel from gas, coal and biomass

• Synthetic fuel refers to liquids from gas (GTL), coal (CTL) and biomass (BTL)

• Products from gas, coal and biomass are identical

• Flexible feedstock options (e.g. coal and biomass co-firing)

Comparison of Energy CyclesComparison of Energy Cycles

Following nature‘s practice – but much faster!

400 million years

1 year 24 hours

Energy SourceThe Sun

Plant growth thru photosynthesis

Formation of fossil energy sources

Exploration of fossil energy sources

Traditional fuelsGasoline / Diesel

Carbo-V ® ProcessPlant growth thru photosynthesis

Sustainable SourceBiomass

Shell Global Solutions

Gaseous FuelsGaseous FuelsCNG & LPGCNG & LPGHydrogenHydrogen

CNG and LPG have been advocated as clean alternatives, but CNG and LPG have been advocated as clean alternatives, but attractiveness reduces as gasoline & diesel quality improvesattractiveness reduces as gasoline & diesel quality improves

• CNG

• Low Sulphur => low PM, NOx & SOx

• Can substitute oil imports

• Expensive infrastructure

• Bulky on-board storage

• Shell companies retail CNG in countries like Argentina, Pakistan.

• Longer term, GTL diesel offers same advantages at lower infrastructure costs.

• LPG

• Lower sulphur => PM, NOx and SOx

• Overall emissions similar to CNG

• Infrastructure costs lower than CNG

• Less bulky storage

• Supplied by Shell in many markets for both fleet and private motorist,

• LPG fuel quality is better controlled than CNG.

CNG & LPG have potential as a niche fuel where conventional fuel is a laggard in addressing urban pollution.

Emission Benefits E2 vs. E4 Options

0.00%

20.00%

40.00%

60.00%

80.00%

100.00%

120.00%

Diesel EU2 Diesel EU4 (no DPF) Diesel EU4 (DPF) CNG EU3 / 4 LPG EU4

Vehicle Options

Emis

sion

s

PMNOxHCCO

All options can meet E4 PM2.5 emission standards as existing E2 diesel taxi is being replaced progressively

Euro IV PM Limit

Diesel Engines become as Clean as Gas EnginesDiesel Engines become as Clean as Gas Engines

HydrogenHydrogen

• Shell is actively involved in hydrogen demonstration projects all around the world

• Operates hydrogen filling stations in Europe, the US and Japan, with plans to build more in the US and China

• However there are many challenges to be overcome before hydrogencan be commercially viable on a large scale

• Cost and performance of fuel cells

• Onboard hydrogen storage capacity

• Improvements in sustainable hydrogenproduction

• Consistency in regulations andstandards

• Financial costs of infrastructure

• Social acceptance

ConclusionsConclusions

Low Green House Gas emissions are the target for the future Low Green House Gas emissions are the target for the future Need for a WellNeed for a Well--toto--Wheels approachWheels approach

• Systematic approach

• Assessment of energy consumption and greenhouse gas emissions

Well-to-Tank

Well

Wheel

WellWell--toto--Wheel Greenhouse GasesWheel Greenhouse Gases

0100200300400500600700800

Gasolin

e ICE

Diesel

ICE

Gasolin

e Fuel

Cell H

EV

Diesel

ICE H

EV

Naphtha F

uel Cell

HEV

FT Dies

el IC

ECNG IC

E

FT Nap

htha FC H

EV

Liquid H2 F

C HEV

Methan

ol Fuel

Cell H

EV

Gaseo

us H2 F

C HEV

E-85 IC

E

Electro

lysis

H 2FC H

EV

Ethanol F

uel Cell

HEV

g CO2/mile Petroleum Natural GasRenewable/Electricity

Better

ICE- internal combustion engineHEV – hybrid electrical vehicle

WTWWTW Analysis of RMEAnalysis of RME ––A Shell Global Solutions StudyA Shell Global Solutions Study

Presented at World Bio-fuels Conference, Seville (April 2002)

W2W CO2 emissions (g/km) from Ford Focus 1.8 - Fossil diesel and RME under different scenarios

0

50

100

150

200

250

Diesel Base Case RME base case RME base case +fertiliser N2O

Land ConversionScenario

Importation

CO

2 g/

km

improvements improvements in in

conventional conventional fuels & fuels &

vehiclesvehicles

local emissions global emissions

short-to-mid term

solutions (20 years)

long-term solutions (2020+)

biobio--ethanolethanol

BioBio--DieselDieselBTLBTL

GTLGTL

LPG* (& LPG* (& CNG*)CNG*)

Hydrogen*Hydrogen*

* require non-conventional vehicle technology

Clean Diesel

Summary Summary –– Key Options for the futureKey Options for the future

ShellShell’’s Approachs Approach

• Quality cost-competitive conventional fuels

• Global leader in differentiated fuels

• Early leader in GTL

• OEM and technology partnerships

• Selling first generation bio-fuels today

• Proactively developing advanced bio-fuels (including BTL)

• Preparing for longer term fuels (Hydrogen)

Ferrari F1 Partnership

Le Mans car using GTL Fuel blend

Shell Global Solutions

Thank You!Thank You!

email: [email protected]

Combustion engines remain the dominant form of propulsion for thCombustion engines remain the dominant form of propulsion for the next e next 2020--30 years30 years

IC Engines75%

Hybrids24%

Hydrogen1%

IC Engines92%

Hybrids4%

Hydrogen4%

New car registrations USA 2030

Source : ExxonMobil Energy Outlook New car registrations Europe 2020

Source : EUCAR