Canada is blessed with vast reserves of natural gas. A large portion of the reserves is in the frontiers and remains unexploited due to the prohibitive cost of transporting the low energy density gas. Moreover, only a small portion of Canada's consumption of natural gas is used as a chemical feedstock. Current conversion technologies involve an initial steam reforming step to produce synthesis gas which is then converted to methanol, gasoline or other products. These indirect routes are energy intensive and costly. Enormous market opportunities can be created especially for remote natural gas by developing new direct conversion technologies.

The development of direct conversion routes is at an early stage. Oxidative coupling of methane to ethylene and partial oxidation to methanol are the two routes most investigated. Engineering and economic evaluations indicate, for both routes, that the product selectivities are less than desirable due to the deep oxidation of the reaction intermediates or products to form carbon oxides.

Aggressive R&D is needed in catalyst design, reactor design and process design to overcome these chemical and engineering challenges and speed the development of direct conversion routes to commercial viability.

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