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BP Amoco, Indian firms to start green fuel project

A consortium of BP Amoco and some Indian energy firms plan to build a natural gas processing plant in India to produce one million tonnes of green fuel di-methyl ether (DME) per year, an Indian Oil official said on Thursday.

BP Amoco will hold 50 per cent of the equity in the project company, while IOC and Gas Authority of India will hold 24 per cent each. The rest will be with the Indian Institute of Petroleum.

"This would be the first major commercial DME project in the world," said Subir Raha, Director for Human Resource, IOC. He informed reporters that DME production had been at a trial stage so far. "The DME plant will be built on the west coast and will use the Haldor Topsoe process for converting gas to liquid," Raha added.

DME is produced through gas-to-liquid technology and has properties similar to liquefied petroleum gas. It can be used as a less environmentally harmful substitute for diesel and naphtha as it has no sulphur, nitrogen or metals.

He said that gas for the project will be sourced from the Middle East. However, he declined to name the specific country.

Last year, an industry official told Reuters that gas would be sourced from either Iran or Qatar. Both have some of the biggest natural gas reserves in the world.

IOC, GAIL and IIP signed an agreement with Amoco in June 1999 to develop, produce and market DME.

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