Elon Musk plans to use Texas natural gas in his ships

Photographer: Austin Barnard / Bloomberg

Elon Musk became the richest man in the world thanks to his enthusiasm for Tesla Inc.’s elegant electric cars – and the stratospheric price of the company’s shares. But while Musk is perhaps the best-known clean energy CEO, SpaceX, his other company, is likely to rely on drilling for natural gas to power the spacecraft, the new spacecraft and rocket designed to transport humans to the moon, Mars and beyond.

Musk’s SpaceX plans to use a location in South Texas to launch rockets to transport people and cargo to the moon and Mars. To do this, the company plans to drill gas wells to produce its own fuel and electricity, according to a Federal Aviation Administration document to Bloomberg.

Musk has long ridiculed the oil industry, promoting renewable energy and electric vehicles as the keys to avoiding a climate catastrophe. But the FAA document and SpaceX’s comments to Texas regulators show how, at least in the short term, some of its goals will depend on fossil fuel extraction plans that are already attracting criticism from environmental groups.

Although Musk has said that he ultimately intends to extract carbon from the atmosphere to produce fuel, a cost-effective method has not yet been developed. The billionaire is donating $ 100 million to a award for “best carbon capture technology”.

The SpaceX Texas site will be supplied by at least five nearby gas wells, along with two gas plants, according to the FAA document. The purified gas from the wells will be pumped into refrigeration equipment that turns it into liquid methane, the document shows. Methane can be combined with liquid oxygen and other compounds to produce rocket fuel.

SpaceX did not respond to requests for comment. But at a hearing last week with The Texas Railroad Commission, which regulates oil and gas in the state, company lawyers said the gas from the wells would be used for “rocket operations”.

The document seen by Bloomberg appears to be an unfinished draft environmental review, said an FAA spokesman. A public comment period that ended last week will be used to complete the official draft of the assessment. Once completed, the draft will be posted on the agency’s website for another round of public comment.

The company is also seeking permission from the FAA to add a gas treatment plant and equipment that will transform methane into its liquid form, and plans to expand a nearby solar farm and build a water desalination plant, the agency’s records show.

SpaceX originally built the coastal site for its Falcon 9 and Falcon Heavy rockets, which are used to launch satellites, but never used it for that purpose. The company is now seeking permission to use it as a launch site for spacecraft that will transport people and cargo to the Moon and Mars, FAA records show.

Vertically integrated

Potential motivation for SpaceX’s plans to produce gas: vertical integration. Musk is a longtime fan of the strategy, which he uses to keep track of his companies’ supply chains. When drilling for gas, SpaceX would avoid paying a third party to produce it and send it to the launch site.

Depending on the proportions of liquid-oxygen-liquid methane fuel, a single launch would require tens of millions of cubic feet of gas.

Even without taking into account the need for gas to power SpaceX’s power plants on the Texas site, a minimum of 10 launches per year would require about half a billion cubic feet. This would cost about $ 1.37 million, based on current reference gas futures that are traded in New York.

To guarantee this gas, SpaceX launched a subsidiary called Lone Star Mineral Development in June. The company wasted no time buying mineral rights in the area, as well as an 806-acre lease originally drilled by the Houston-based oil company Sanchez Energy, which was renamed Mesquite Energy after coming out of bankruptcy last year.

It is unclear how much Lone Star gas will be able to extract from the site, however. Cameron County, where the launch site is located, is not a prolific source of fuel. Sanchez’s lease, put into production in 2011, yielded about 536 million cubic feet of gas during the first year, data from the Railway Commission show. But after that, production continued to drop until the well was taken out of service in March 2014.

Geology is not the only obstacle to SpaceX’s gas production plans. The company faces legal challenges over a plot of land that forms a small part of the drilling contract. Closely maintained producer Dallas Petroleum Group LLC says it is paying property taxes for two wells there and is asking the Railway Commission to resolve a dispute over control of the wells with Lone Star. She had previously sued Sanchez for access to the wells and amended the process on Friday to add SpaceX and Lone Star as defendants.

Lone Star also purchased two offshore rigs from drilling contractor Valaris Plc last year. They are likely to be used as landing platforms for SpaceX’s reusable rockets, FAA records show.

Environmental Opposition

A coalition of a dozen environmental groups is already warning about SpaceX’s expansion plans. The rocket launch site went well beyond the scope of its original license and the company’s plans threaten an environmentally sensitive corridor along the United States’ border with Mexico, according to the coalition.

At the launch site last year, “there were at least three explosions, some of which resulted in more fires that burned smaller areas” of public land, said EJ Williams, vice president of American Bird Conservancy, in an email. “These explosions directly impacted the designated critical habitat used by federally listed species and other species in decline.”

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More traffic on the highway leading to the launch site has dramatically increased the number of animals killed by vehicles, and the closure of rocket launch roads has prevented biologists from studying threatened species of migratory birds that nest nearby, according to David Newstead, director of bird conservation projects for the Coastal Bend Bays & Estuaries Program, based in Corpus Christi.

The FAA originally allowed SpaceX 12 launches per year and 180 hours of road closings, but Newstead said his group documented more than 1,100 hours of road closings last year.

Because of changes in SpaceX’s plans for the Texas website, environmental groups want the FAA to use a more rigorous and transparent process to review the company’s proposals. For example, the The Federal Energy Regulatory Commission requires companies looking to build new pipelines or export terminals to submit regular public updates, while the FAA does not require the same level of disclosure, said Patrick Anderson, president of the Lower Rio Grande Valley section of the Sierra Club.

While SpaceX is seeking permission to produce gas in the short term, the Texas launch site may ultimately promote Musk’s zero carbon reduction ambitions. Gas drilling can be part of obtaining long-term experience with the use of in-situ resources, or ISRU, the practice of generating products with local materials. Although there are no fossil fuels on Mars, those who land there may need to drill for water or minerals.

Musk could also use drilling to gain experience in developing carbon dioxide storage wells. SpaceX will likely have to use carbon capture on Mars to make fuels for the journey home, making it crucial to get the right technology.

Historically, liquid hydrogen was the fuel of choice for early space missions, while a rocket loaded with kerosene and liquid oxygen sent Buzz Aldrin, Neil Armstrong and Michael Collins to the moon.