07-05-2018

Air Products and Shell to provide residue gasification technology to refineries

Air Products announced today it has successfully completed the acquisition of the Coal Gasification Technology licensing business from Shell Global Solutions International B.V., a subsidiary of Royal Dutch Shell plc, and formed a strategic alliance with Shell for residue gasification technology to refinery complexes. The acquisition includes Shell’s associated patent portfolios for solids (coal and biomass) gasification and sharing of patent rights for residue and biomass gasification. Financial terms are not being disclosed for the agreement, initially announced in Jy.

These moves extend Air Products’ offerings in synthesis gas (syngas) to provide turn-key sale-of-gas gasification facilities for solids (coal and biomass) and liquids (refinery residues). In its sale-of-gas business model, Air Products finances, builds, owns, operates and maintains the gas production plant, enabling customers to focus attention and capital on their primary business. 

“Air Products now has immediate access to Shell’s proven technology and a successful business, with that technology already in place at nearly 200 gasification systems delivering syngas around the world,” said Air Products’ Chairman, President and Chief Executive Officer, Seifi Ghasemi. “Beyond a strong operating base, we now have a robust technological foundation that builds on our core focus supplying the full range of industrial gases to our customers.”

Gasification technologies offer a way to take varied lower-value feedstocks and convert them in a lower-emission manner into syngas. Air Products can then provide this syngas to customers to make higher-value products. Shell has been at the forefront of gasification research and innovation over the past 50 years, with reports showing 170 Shell gasification process (SGP) and 34 coal gasifiers built, and currently, 96 SGP and 24 Shell coal gasification process gasifiers in operation worldwide.

“The core value of this acquisition is the ability to build on more than 40 years of Air Products’ gasification experience and the opportunity to fully explore sale-of-gas outsourcing options to produce and supply syngas for customers planning to use gasification. This is a great fit for us as Shell’s strong track record in reliability and efficiency complements our own sale-of-gas offerings, which have the highest reliability levels,” Ghasemi added.

This acquisition of Shell’s gasification process capabilities will further support previously announced projects by Air Products such as Lu’An in Changzhi, Shanxi Province, China, which the Company has successfully closed, as announced on its fiscal second quarter earnings call, as well as for future projects. 

Through the new strategic alliance between Air Products and Shell in liquids (residue) gasification, Air Products will offer complete sale-of-gas residue gasification facilities to the refining industry and will be a project operating partner for the supply of industrial gases in the strategic alliance. The alliance will leverage Shell’s technology lead in the liquids (residue) gasification area, as demonstrated at the world-scale Jazan combined gasification/refinery project under construction in Jazan Economic City, Saudi Arabia.