Rethinking the economics of coal to olefins

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Coal-to-olefin upgrading demonstration schemes that place higher demands on energy efficiency, coal consumption, and water consumption are currently approved by the State Council. If multiple technical solutions are adopted to meet the demonstration requirements, the profitability of coal-to-olefins production space may be reduced. This is the information obtained from the 4th China Coal and Olefin Technology Economic Symposium held in Beijing from November 15th to 16th. The technical feasibility and economic efficiency of coal-to-olefins have been questioned. After the confirmation of four sets of equipment, namely Shenhua Baotou, Shenhua Ning Coal, Datang Duolun and Sinopec Zhongyuan Petrochemical, it is now once again faced with an upgrade demonstration program.

Zheng Baoshan, deputy director of the Petroleum and Chemical Industry Planning Institute’s petrochemical division, revealed that according to the demonstration requirements for upgrading from coal to olefins, the energy conversion efficiency is not less than 40%, the coal consumption per ton of olefins is no higher than 5.3 tons (standard coal), and tons of standard coal are fresh. Water consumption is not more than 4 tons. “This is a basic requirement. The coal-to-olefins projects reported by various localities must meet or exceed the above-mentioned demonstration standards. To achieve advanced requirements, energy efficiency must not be lower than 44%, coal consumption should not be higher than 5 tons, and water consumption should not exceed 3 tons.”

How to meet the indicator requirements of the upgrade demonstration has become the focus of attention of the delegates. Zheng Baoshan stated that it is possible to rationally configure and optimize the thermal system, water system, process system and outreach system of the project. In terms of thermal systems, IGCC, thermal cascade utilization, combination of steam drive and electric drive, and direct power supply for large units are the key points for optimizing the efficiency. For the water system, the circulating cooling water can be combined with closed or closed, air-cooled and water-cooled. In a combined manner, organic wastewater can be pre-treated, A/O, BAF, multi-media filtration, activated carbon combined, and inorganic wastewater can be lime softened and clarified, filtered, ultrafiltration, reverse osmosis, evaporation, and crystallization combined. To achieve near-zero discharge of waste water; process selection of environmental protection and energy conservation technologies; outreach system to achieve large-scale direct power supply organic coupling.

He emphasized that through an optimized combination of multiple aspects, the coal-to-olefins project can meet the upgrade demonstration requirements. “However, due to the comprehensive adoption of energy-saving emission reduction technologies and solutions, project investment will increase by 5 billion to 6 billion yuan over traditional programs, and product cost competitiveness and investment efficiency will be greatly affected, especially in the face of strong competition from petrochemical products from the Middle East. The investment risk of the project has greatly increased.” Xie Bo, chief representative of UOP, and Li Yansheng, technical director of Wison Engineering (China) Co., Ltd. also expressed concern about the future profitability of coal-to-olefins.

Several representatives interviewed by reporters all suggested that the economic benefits of coal to olefins can be improved by optimizing the downstream product mix. For example, the olefin processing scheme may include various solutions such as resin, resin+raw material monomer, resin+high-end chemical, etc., and it may also fully utilize the downstream extension of normal butene produced by MTO.

“In the first three quarters, the Shenhua Baotou Coal to Olefins Project produced a total of 439,000 tons of olefin products and achieved a profit of 950 million yuan.” Yue Guo, Vice President of China Shenhua Coal-to-oil Chemicals Co., Ltd. is still full of confidence in the economics of coal-to-olefins, but The risk of introducing IGCC technology is a concern.

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