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Natural Gas, Processing and Conversion of


Natural gas is an important energy source consisting mainly of methane gas. It is usually found commingled with deposits of crude oil and also in stand-alone deposits where the gas has migrated to, leaving the associated petroleum in some other location. Methane is also produced by decaying vegetation (swamp gas) in some coal mines and in land fills, but these sources generally are not suitable for commercial use.

When natural gas comes out of the ground (see Figure 1), it typically consists of 75 to 95 percent methane, with small quantities of ethane, propane, and butane. It may also contain water vapor, carbon dioxide, nitrogen, oxygen, and sulfurous gases such as hydrogen sulfide. Unlike petroleum, which needs to be separated and refined into a variety of fuels and petrochemical products, the nature and general purity of natural gas makes processing far less complex. Most natural gas from the wellhead needs little processing. Nonhydrocarbons are removed from the contaminated alkanes (hydrocarbons containing only single carbon-carbon bonds) by absorption. The heavier hydrocarbons tend to liquefy at the high operating pressures needed for natural gas pipelining. If the natural gas is to be liquefied (LNG), the hydrocarbons are separated by absorption or low temperature distillation.

Before entering the pipeline, the gas is also adjusted in the field to achieve a uniform heating value of 1,000 Btu (British thermal units) per cubic foot. And for safety, because natural gas is odorless and colorless, an odorant is added to provide a distinctive and disagreeable smell that is easy to recognize.


The clean-burning nature of natural gas has for many years made it the fuel of choice for heating and cooking. If its energy content per cubic meter were comparable to liquid fuels like such as diesel and gasoline, it would be ideal as a transportation fuel as well. However, the void is wide. Whereas gasoline and diesel deliver 110,000 to 120,000 Btu per gallon, an equivalent volume of natural gas delivers only about 134 Btu per gallon. Thus, there is great interest in finding ways to efficiently compress or liquefy natural gas so that the same low-emission benefits found in the residential, industrial, and electricity generation markets serviced by pipelines can also be enjoyed by areas without pipeline service and by the transportation sector.

Once water vapor, sulfur, and heavy hydrocarbons are removed, natural gas can be compressed or liquefied. As a transportation fuel, the high methane content gives natural gas its high octane rating (120–130) and clean burning characteristics, resulting in the dual benefit of high engine performance and low pollution. There are no sulfur or particulate (smoke) emissions. Currently, there are two types of natural gas vehicles: exclusively natural gas and bifuel. The latter operate on natural gas or either diesel or gasoline, and the fuel can usually be changed with the flip of a switch.

Compression or conversion for greater use in the transportation market is promising for two reasons: First, natural gas is usually cheaper than liquid fuel and, second, there exist large quantities of stranded gas—remotely located natural gas sources that are not economical to use because tanker or pipeline transportation costs can be over four times as much as for crude oil. Often this gas is recompressed and injected back into the oil-producing zones to help maintain reservoir pressure and optimal crude oil flow to the wellhead. In some cases this gas is wasted by being flared, but this practice is increasingly frowned upon. The demand for cleaner-burning transportation fuels, and the advances in gas turbines that have dramatically improved the efficiency of natural gas powered electricity generation have renewed interest in developing ways to compress or liquefy this gas to lower its shipping cost. Liquefaction can mean cooling the natural gas until it condenses at –187°C (at atmospheric pressure) or converting it chemically to a suitable liquid fuel. Both of these schemes entail considerable energy costs.

Some environmentalists have also touted natural gas as a way station on the road to a hydrogen fuel (carbon dioxide-free) economy. As seen in Table 1, per unit of energy released, natural gas generates about 23 percent less carbon dioxide than gasoline and about 30 percent less than heavy fuel oil. This is helpful in reducing greenhouse emissions, but the other excellent properties of natural gas are even

  Hydrogen Natural Gas (as Methane) LPG (as Propane) Gasoline (as Octane) Methanol
Molecular Weight 2 16 44 114 32
Heat of Combustion kilocalories / gram 34.16 13.30 12.06 11.46 5.42
Grams of carbon per gram of fuel 0.00 0.75 0.82 0.84 0.38
Grams CO2 evolved per gram of fuel 0.00 2.75 3.01 3.09 1.38
Grams CO2 evolved per kilocalorie 0.00 0.207 0.250 0.270 0.254

more important from the standpoint of economic efficiency. However, if the natural gas has to be converted chemically to methanol, the high-octane, clean-burning advantage is maintained, but the carbon dioxide advantage is lost.

As seen in Table 1, on a weight basis, hydrogen has the highest heat of combustion of all fuels. Hydrocarbons are less than half as energetic, the lighter, more hydrogen-rich molecules having somewhat higher heating values than the heavier, more carbonaceous fuels. However, on a volumetric basis, the heavier fuels win out, as their higher density (specific gravity) more than off-sets the difference in heat of combustion per unit weight.


Table 2 compares the heating value of 20-gal tanks of natural gas at different pressures. Pipelines deliver natural gas at a relatively low pressure of 60 pounds per square inch (psi). A 20-gallon vehicular tank filled at this pressure would provide only about 11,000 Btu versus about 2.4 million Btu for a diesel fuel tank of the same size. Thus, the gas must be compressed and stored in a welded bottle-like tank at 3,000 to 3,600 psi to provide any reasonable range. A 20-gallon 3,000 psi tank will provide about 20 percent of the diesel heating value, so to begin to approach the range of gasoline or diesel vehicles, some of the newer vehicles offer advanced tanks capable of holding gas compressed to 5,000 psi.

Although the heating value of a 20-gal 3,000 psi tank of natural gas is only 20 percent of the same volume of diesel fuel, the mileage range comparison will likely be better than the volumetric ratios because the natural gas engines can achieve higher performance.

There are two ways of refueling compressed natural gas (CNG): time-fill or fast-fill. For a time-fill compressor, it is necessary to develop a pressure only slightly greater than the vehicle storage pressure—the gas flows from greater pressure to less pressure. Time-fill compressor stations can require a couple of hours to refuel, which is a major inconvenience for most motorists. However, it is the best choice for many fleets that can be refueled overnight with one fill-post for each vehicle to be refueled.

Public stations are of the fast-fill type, typically to satisfy the desire of customers to refuel quickly. The biggest problem for fast-fill operations is the lack of space and high cost. Large capacity high pressure storage is needed to fast-fill vehicles because the larger and greater the pressure, the faster the fill-up.

All CNG ground storage, vehicle storage and refueling equipment must meet stringent industry and government safety standards for both normal operation and crashes. The controls include monitors of critical pressures and temperatures from the pipeline to the storage tank, and the flow of gas from ground storage to vehicle storage. Once the compressor reaches discharge pressure (fill-up complete), a control then automatically turns off the compressor. CNG is then delivered to the engines as low pressure vapor (ounces to 300 psi). Since natural gas cylinders are much thicker and stronger than gasoline or diesel tanks, the safety record of natural gas vehicles is equal or better than conventionally fueled vehicles.

Almost all the major car, bus, and truck manufacturers have developed compressed natural gas engines and vehicles. These manufacturers have been able to offer better performance (due to higher octane) and far lower emissions of nitrogen oxides, carbon monoxide, particulate matter, and carbon dioxide to the atmosphere. In 1998, Honda introduced the cleanest internal combustion engine vehicle ever commercially produced: the natural gas Civic GX with emissions at one-tenth the state of California's Ultra Low Emission Vehicle standard. Primarily due to the high octane of natural gas, Honda achieved these results without sacrificing performance.

Despite the environmental benefits of natural gas vehicles, large numbers of compressed natural gas stations need to be built or compressed natural gas will never be more than a niche fuel servicing large fleets of buses, cabs, and delivery trucks that can be fueled at a central location. Nonroad short-range vehicles such as forklifts, backhoes, street sweepers, and airport ground support equipment are also ideally suited for natural gas use.

The high mileage, local routes, and regular returns to a central refueling point make local transit buses an ideal application for CNG vehicles. Another option for local driving and commuting is home refueling. For around $2,500, a system can be plumbed directly into a home's natural gas supply for refueling in the garage or driveway. Though the benefit of home refueling is a tremendous benefit for the majority of drivers, the CNG disadvantages of shorter range, slower refueling, and few refueling stations far out-weigh its advantages. American car buyers want the mobility to go anywhere at any time. Whereas most gasoline cars and trucks can go 250 miles or more on a tank of fuel, natural gas vehicles typically can go about half that distance. Consumers are reluctant to switch to a CNG vehicle that requires refueling twice as often with so few refueling options.

The industry has developed higher compression tanks to expand the range, and more fast-fill stations are becoming available, yet the prospects of the majority of service stations adding compressed natural gas refueling anytime in the near future are bleak. The oil companies, which control most of the service stations and over 60 percent of America's natural gas reserves, are not eager to make the massive infrastructure investment to cannibalize the billions of dollars they have tied up in refineries, pipelines, and service stations

Pressure Million BTUs
Ambient (14.7 psi) 0.00267
60 psi 0.01009
3000 psi 0.546
5000 psi 0.910
diesel oil 2.4

designed to deliver gasoline and diesel fuel. However, though not willing to lead, they are certain to follow. If consumers purchase the vehicles, the oil companies will naturally invest in the infrastructure. Supply will follow demand. Moreover, if it turns out that fuel cell vehicles that run on hydrogen are the future, compressed natural gas vehicles could be the logical bridge between petroleum and hydrogen because hydrogen is also a compressed gas. The same infrastructure can deliver both.

More stringent clean-air regulations and enforcement was the primary reason for natural gas vehicle growth in the 1990s, and is highly likely to play a part in future growth. According to the Natural Gas Vehicle Coalition, more than 20 percent of all new orders for transit buses were for natural gas-fueled vehicles in 1998. These new vehicles require a significant capital investment, yet often justify this higher initial investment by reducing air pollutants, lower maintenance costs, and offering fuel savings of about 30 percent compared to gasoline and diesel.


Natural gas is liquefied by cooling it to its liquid state (approximately –260°F), at either the wellhead, central facility, or on-site. Since liquefaction reduces its volume by a factor of about 600, it becomes economical to ship by tanker.

To remain a liquid at a reasonably low pressure, liquefied natural gas (LNG) must be maintained at below at least –117°F. Insulated storage tanks alone cannot maintain these very cold temperatures. LNG is stored at its boiling point to take advantage of "autorefrigeration." Just as the temperature of water does not rise above its boiling point (212°F) with increased heat (it is cooled by evaporation), LNG is kept near its boiling point if kept at a constant pressure. As long as LNG vapor boil off is allowed to leave the storage tank, the temperature will remain constant. The pressure and temperature in the tank will rise when the vapor is not drawn off.

During the liquefaction process, usually much of the oxygen, carbon dioxide, sulfur compounds and water are removed so that liquefied natural gas (LNG) is nearly 100 percent methane. LNG takes up one-six-hundredth the volume of natural gas, with a density less than half that of water.

Although LNG is as safe or safer than gasoline and diesel fuel, and emits less harmful emissions when burned, it has three major drawbacks: It is expensive to produce, requires a larger and heavier fuel tank (about 1.5 gallons of LNG per gallon of gasoline and 1.7 gallons per gallon of diesel to achieve the same range), and is not the best fuel for vehicles used rarely or intermittently because of vapor boil-off over time. The best applications for LNG are heavy-duty vehicles (trucks and buses) that are heavily used, and vehicles that can store larger fuel tanks, or are not inconvenienced by need for more frequent refueling.

LNG tanks use low pressure (less than 5 psi), yet need double-wall construction so that insulation between the walls keeps the LNG cool. For the large tanks, a cylindrical design with a domed roof is used, but for smaller quantities (70,000 gallons or less), storage is in horizontal or vertical vacuum-jacketed tanks at pressures any where from less than 5 psi to over 250 psi.

Because much of the world lacks the natural gas resources and transportation pipelines of the United States, remote natural gas must be liquefied and transported by ship. Gas-rich countries want to capture stranded gas by liquefying and shipping it to gas-poor regions as LNG. The gas-poor countries enter into contracts so that a long-term supply is available to warrant the investment in the electricity-generating infrastructure. The overall investment is enormous, not only in the liquefaction plant, but in the refrigerated tankers and the regasification plant at the delivery site.

Sometimes LNG is the only option in regions and countries where political issues constrain pipeline development.

Shipments of LNG began in the early 1960s and continued to expand so that by 1995 there were over 65 ships transporting almost 68 million tons of LNG, with each equipped with a specialized refrigeration system to keep LNG cool enough to stay in its liquefied state. Transportation was estimated to reach 107 million tons by 2,000, with the major exporters being Malaysia, Abu Dhabi, and Qatar, and the major importers being Japan, Korea, and Europe. Since OPEC production quotas limit petroleum production, which by extension limits revenue, LNG has also developed into an attractive export commodity for OPEC countries since current production agreements do not extend to natural gas. Several major projects to expand LNG trade went to contract in the late 1990s. New LNG processing facilities have been built or are under construction in Oman, Qatar, Nigeria, and Trinidad, with Japan, South Korea, Taiwan, and Thailand being the largest customers committing to purchase output from the new facilities.

There has never been an LNG tanker accident; yet, with growing shipments, there is growing concern about a tanker accident since an explosion and fire occurring in a crowded harbor could be disastrous. However, while an LNG tanker may contain the energy equivalent of several Hiroshima atomic bombs, the damage would hardly be comparable because the LNG energy cannot be released quickly. For a detonation, LNG must first be mixed with air in the correct flammability ratio, and near a tank rupture the mix would probably be too rich to explode. Further, the liberation rate of LNG as a gas would be determined by the heat transfer rate to the boiling liquid. Thus, any accident would likely be a large deflagration, not a horrific explosion.


As an alternate to LNG, natural gas can be chemically converted to methanol, chemical feedstocks (such as ethylene), gasoline, or diesel fuel. Most processes start with the conversion of methane to synthesis gas, a mixture of carbon monoxide and hydrogen. This can be done partial oxidation, an exothermic reaction: or by steam reforming, an endothermic reaction: Shortly after World War I, Badische Anilin patented the catalytic conversion of synthesis gas to methanol, and Fischer and Tropsch (F-T) announced a rival process in which an iron catalyst converted synthesis gas into a mixture of oxygenated hydrocarbons. Later, improved F-T catalysts produced a liquid resembling a very paraffinic (waxy) crude oil.

Most of the early commercialization used coal as the synthesis gas feed-stock. Use of stranded natural gas feed to a F-T refinery was finally innovated by Shell-Mitsubishi in a small, 10,000 bbl per day refinery in Sarawak, Malaysia in 1993. F-T liquids are refined in the usual manner to produce gasoline and diesel fuel/kerosene of very high quality.

Similarly, a natural gas-to-methanol-to-gasoline process was finally developed by Mobil as a result of the 1973 oil crisis. Methanol is transformed into gasoline range hydrocarbons using proprietary Mobil synthetic zeolite catalysts. This process was commercialized at a small New Zealand refinery in the 1980s. Methanol is also the feedstock of choice in the production of the oxygenated additives needed to produce today's cleaner-burning gasoline blends.

While several other processes have been developed to convert natural gas to liquid fuels (GTL), these technologies are generally uneconomical composed to using the crude oil feedstocks. About one-third of the energy in natural gas is lost in converting it into liquid fuels, so highly distressed gas prices or government subsidies are needed for GTL to be competitive.

Fischer-Tropsch Diesel

One of the most promising GTL fuels is Fischer-Tropsch diesel. Fischer-Tropsch diesel offers lower emissions without compromising fuel efficiency, creating distribution problems (new infrastructure), or requiring a greater investment in equipment for fuel storage and refueling. Depending on the price premium for GTL, the Fischer-Tropsch diesel can be used as a fuel or blended with traditional diesel that is not compliant with Federal or California standards. Used alone, GTL diesel reduces hydrocarbons by over 20 percent, carbon monoxide over 35 percent, nitrous oxide about 5 percent, and particulates around 30 percent. Although GTL diesel is more expensive than traditional diesel fuel, it seems to be a promising short-term solution for the fuel industry to meet the California heavy-duty diesel engine standard that goes into effect in 2004. ARCO, Exxon, Chevron, and Texaco are all in the process of developing pilot plants.

The major advantage of Fischer Tropsch diesel, compared to natural gas, lies in its liquid nature. It does not need special infrastructure and compression like CNG does, and unlike LNG, once converted, it is a liquid fuel that can be treated like any other liquid fuel. However, because the GTL process is more complex than traditional refining, it requires low-cost natural gas priced at less than $1 per million BTUs to remain cost-competitive. Without stranded gas, sources sold at a large discount compared to crude oil, GTL diesel would be considerably more expensive than traditionally refined diesel fuel.


Many transportation experts feel that hydrogen is the fuel of the future. It has a high energy content and many environmental advantages. However, before hydrogen becomes an economical alternative fuel, ways to produce hydrogen on a large scale will need to be developed. Conversion from natural gas is widely viewed as a promising option for two reasons: Hydrogen-rich natural gas can be converted more cleanly than coal, and natural gas requires less energy input than a conversion from water.


Many GTL-derived fuels are being considered for blending with gasoline and diesel to achieve emission reductions of particulate matter (PM), carbon monoxide (CO), nitrogen compounds (NOx) and nonmethane hydrocarbons (NMHC). The most promising fuels converted from natural gas are methanol and ethers such as dimethyl ether (DME) and methyl-t-butyl ether (MTBE).

Like LNG, the natural gas-to-methanol fuel market relies on stranded gas as feedstock. The advantages of conversion to methanol is that it requires far less specialized infrastructure than LNG since the final product is a 110-octane liquid that ships in regular tanks, and does not need regasification. And because of a plentiful natural gas supply in the United States, methanol derived from natural gas as a fuel additive is a promising future market. Methanol has neither the environmental problems of methyl-t-butyl ether (MTBE), nor the evaporating qualities of ethanol.

John Zumerchik Herman Bieber


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