Dimethyl Ether – Invest Medicine Hat

Dimethyl Ether


 Dimethyl Ether is gaining attention as a cleaner-burning fuel and can be derived from methanol. With Canada’s leading methanol plant already operating in Medicine Hat, a DME facility makes sense.

Medicine Hat, Alberta is an excellent location option for companies looking to process dimethyl ether (DME).

While DME can be produced from a variety of abundant sources, world production today is primarily by means of methanol dehydration. As luck would have it, Medicine Hat is home to Canada’s leading methanol producer.

Indeed, the long-standing cluster of methane processing facilities here in the Gas City helps make the case for transforming natural gas into DME, a clean, colourless gas that is easy to liquefy and transport.

Market Reports

Oberon Fuels

  • DME (dimethyl ether) is a clean-burning, non-toxic, potentially renewable fuel. Its high cetane value (55-60) and quiet combustion, as well as its inexpensive fueling system, make it an excellent, inexpensive diesel alternative that will meet strict emissions standards.
  • DME can be produced domestically from a variety of feedstocks, including biogas from organic waste produced in cities or by agricultural operations, as well as natural gas.
  • DME can be stored as a liquid under moderate pressure, eliminating the need for the high-pressure containers used for CNG or cryogenics, as in the case of LNG. DME’s easy handling properties make fueling and infrastructure relatively simple and inexpensive.
  • Oberon Fuels presentation by President Rebecca Boudreaux, PhD

Transport Canada DME Fuel Literature Review

  • Based on current projections, it is likely that the abundance of North American natural gas and a high level of animal waste could provide ample sources for future DME production without reliance on offshore resources.
  • It takes approximately 1.4 tons of Methanol to produce approximately 1.0 ton of DME.

US Department of Energy: DME

  • DME is typically produced through a two-step process using syngas as a feedstock. The syngas is converted to methanol, which is then converted to DME. DME can be produced from any methane-containing feedstock, including pipeline natural gas, biogas, landfill and waste water treatment gas, and stranded natural gas. Water resource requirements and wastewater generation are expected to be minimal.
  • The use of DME as a diesel substitute offers several beneficial characteristics that will help meet renewable fuel goals.
    • Cleaner Burning Diesel Fuel
    • Reduced Carbon Intensity
    • Low DME Toxicity

Dimethyl Ether Multimedia Evaluation (University of California)

  • Different Uses of DME
    • Use as a liquefied petroleum gas (LPG) substitute for cooking and heating. DME combustion produces very low NOx and CO emissions and no sulfur or soot emissions.
    • Use as a chlorofluorocarbon (CFC) substitute for propellants in cosmetic- or paintaerosol cans (Ohno 2001).
    • Use as a diesel substitute. DME has a high cetane number (55) and can be combusted in diesel-powered vehicles that have been retrofitted to run on DME or in purpose built engines.
    • Use as a precursor to dimethyl sulfate and acetic acid production Use as a refrigerant.
    • Use as a rocket propellant.
    • Use as carrier for livestock insect sprays and foggers.
    • Use as a solvent for extraction of organic compounds.

Methanol Institute

  • World production of DME today stands at approximately 5 million tons per annum, and is primarily by means of methanol dehydration. The majority of global DME production is currently in China.
  • The global dimethyl ether market size in terms of volume was estimated to be 3,740.46 KT in 2014
  • China’s National Development and Reform Commission is calling for 20 million tons of DME production capacity by 2020
  • Japan, Korea and Brazil have significant new production facilities, and major new capacity additions are planned or under construction in Egypt, India, Indonesia, Iran and Uzbekistan
  • The growing global production capacity for DME and BioDME means expanding and dynamic markets for methanol.


First Customer Demonstration of DME-Powered Mack Truck Begins in New York City

  • The New York City Department of Sanitation (DSNY) today became the first Mack customer in the world to evaluate DME in its fleet
  • The goal of the demonstration is to gather data on the use of both DME fuel and vehicles in urban, heavy-load fleets, and is the first step in the city’s evaluation of DME as a potential long-term strategy to help reduce greenhouse gas emissions

Final Investment Decision Reached on Trinidad and Tobago Methanol/Dimethyl Ether Plant

  • September 2015: Mitsubishi Gas Chemical Company announced final investment decision regarding a methanol and DME plant in Trinidad and Tobago.
  • Dimethyl ether can be used as a substitute for LPG or as a substitute for diesel in automobiles and in power generation, and has therefore been receiving a lot of attention as a source of next-generation clean energy.

Ford leads project to develop near zero particulate emission diesel cars that could run on converted CO2

  • September 2015: Ford European Research & Innovation Center is to lead a €3.5 million project to investigate alternative fuels that could one day offer diesel car customers enhanced fuel efficiency while minimizing environmental impact
  • The project consortium will develop the first passenger cars, based on a Ford Mondeo, to run on environmentally friendly dimethyl ether (DME), and oxymethylene ether (OME1)
  • Both fuels can be generated from CO2captured from the air that is combined with wind and sun power, or waste products


International DME Association

  • Methanex is a patron member

Methanol Institute

  • DME and bioDME have a number of uses in products and are most commonly used as a replacement for propane in liquid petroleum gas (LPG), but can also be used as a replacement for diesel fuel in transportation.

Government Programs

Alberta Climate Leadership Plan

  • Alberta will reduce methane emissions from oil and gas operations by 45% by 2025 using the following approaches:
    • Applying new emissions design standards to new Alberta facilities. Applying standards at the planning stage will be less expensive.
    • Improving measurement and reporting of methane emissions, as well as leak detection and repair requirements.
    • Developing a joint initiative on methane reduction and verification for existing facilities, and backstopping this with regulated standards that take effect in 2020, to ensure the 2025 target is met. This initiative will include Alberta industry, environmental groups and Indigenous communities.

Emissions Reduction Alberta (ERA)

  • ERA’s goal is to accelerate development of innovative technologies that reduce greenhouse gas emissions and secure Alberta’s success in a lower carbon economy.
  • ERA-funded projects not only reduce greenhouse gas emissions, but also spur additional investment. For every dollar ERA invests, more than another five dollars are also invested.
  • Energy efficiency funding helps organizations reduce carbon dioxide emissions by finding ways to make their operations use less energy, or burn less fossil fuels.

Medicine Hat Advantage

In addition to feedstock proximity and a talented workforce, Medicine Hat offers potential DME processors additional advantages:

  • Low cost operating environment. Medicine Hat has Western Canada’s lowest tax and utility rates.
  • Brier Park Industrial Park. Industrial land and building costs are very competitive to other Western Canadian cities.
  • Competitive labour rates. At $22.74 per hour, the average hourly wage in Medicine Hat comes in at a 15% discount to Alberta’s average.
  • Good labour availability. Medicine Hat is a young community with a median age of 39 years and a labour force of over 20,000 people in the 20-44 year old range. The labour market is balanced with unemployment currently hovering at around 7%.
  • Affordable cost of living. The average home price in Medicine Hat sits at $275,000, offering a steep discount to neighbouring Western Canadian centres and a better quality of life for residents and employees (source).
  • Excellent market access. Medicine Hat is located on the Trans Canada Highway (Highway #1), the Crows Nest Highway (Highway #3), the CP main line, and major pipelines. The Medicine Hat Regional airport offers daily connections to Calgary, jumping off point to the world (map).
  • Enviable quality of life. The City-owned utility contributes to a quality of life that is second to none. Medicine Hat is home to a number of world-class facilities including the Canalta Centre, the Esplanade, and the Family Leisure Centre, not to mention an amazing network of parks and trails.

The opportunity for companies looking to develop DME is real and growing, with demand in heavy duty transportation, marine, and remote mining operations on the rise around the world.

For example, Volvo Trucks recently became the first manufacturer to announce plans to commercialize DME-powered heavy-duty commercial vehicles in North America. And Ford Motor Company is leading the charge to develop near zero particulate emission diesel cars that could run on converted CO2.

It’s not hard to see why all the excitement about DME’s potential.

DME is an environmentally friendly fuel option — ultra clean DME diesel fuel provides smokeless combustion, low CO2 and 90% less NOX emissions than standard automotive fuels.

According to the International DME Association, DME is up to five times more efficient than traditional fuels, resulting in less energy wastage and better use of resources. Plus, DME is portable, safe, and versatile.

For companies that are active in the development of DME worldwide, it makes sense to take a closer look at Medicine Hat, Alberta for North America’s first dedicated DME processing facility.

Current Uses of DME

Mack Trucks | Last month Mack Trucks became the third major truck and engine manufacturer to announce a demonstration of heavy-duty trucks running on DME, following Volvo and a consortium of Chinese companies including Weichai Power (industrial, heavy-duty vehicle and powertrain manufacturer), China Jinggong (vehicle manufacturer), and Shanghai Diesel (engine manufacturer).

Ford Motor Company | Ford’s project to develop and test the world’s first production passenger car running on DME;

Large-scale production plant | Construction of the first large-scale DME fuel production plant in the Americas is now underway in the $850 million project involving the Natural Gas Company of Trinidad and Tobago, Mitsubishi Corporation, Mitsubishi Gas Chemical, Mitsubishi Heavy Industries and the Massy Group;

Chinese engine certification | Certification of the first DME heavy-duty engine in China in a project supported by the Chinese national high-tech R&D “863 Program”;

DME vehicle tax incentives and RINs credits | Washington became the first U.S. state to establish financial incentives for the purchase of commercial vehicles using DME; the U.S. EPA qualifies DME for valuable RINs credits;

Environmental | The U.S. EPA confirms DME’s qualification as an alternative fuel; DME’s low emissions and GHG credentials are reconfirmed in GREET model updated for DME in a project led by Argonne National Laboratory;

Standardization | International consensus standards published by both ISO and the ASTM; new ISO workgroup established to create standards for DME components;

Regulatory | Now legal to use DME as a fuel in all fifty U.S. states and Canada.
These developments and others now in the pipeline provide a basis for increasing confidence in DME’s readiness and viability for large scale commercial use in a variety of transportation and applications.

Information courtesy the International DME Association.