The production capacity of coal-based olefins in western China is expanding rapidly, exceeding 8 million tons per year by 2017

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The production capacity for olefins produced from coal in China’s western region is expanding rapidly; by 2017, it had exceeded 8 million tons per year. Author/Source: Date: 2017-10-16. Clicks: 12. As of the end of September 2017, China had 21 facilities for producing olefins from coal (or methanol), with a total production capacity of 12.09 million tons per year (the MTP facilities that are not in operation in Shandong Province are not included in this figure). Among them, the 8.18 million tons per year of olefin production capacity from coal (methanol) is concentrated in the western region of China. Yahua Consulting selected four typical coal (methanol)-to-olefins projects in the western region, namely Shenhua Baotou Coal Chemical Co., Ltd., Inner Mongolia China National Coal Group Mengda New Energy Chemical Co., Ltd., Shenhua Yulin Energy Chemical Co., Ltd., and China National Coal Group Shaanxi Yulin Energy Chemical Co., Ltd., to analyze aspects such as the operational status of these projects, raw material supply and prices, product sales, logistics and inventory, costs and profits, as well as future expansion plans. http://img.yf116.cn/image/img/20171016/1645136031343.jpg http://img.yf116.cn/image/img/20171016/1645486034853.jpg Overall, these four coal (methanol)-based olefin production projects in the western region have entered a stable operation phase, with an operating load of 100–110% (excluding maintenance periods) ； The supply of raw materials is stable, coming mainly from companies affiliated with the group or nearby enterprises ； Fluctuations in raw material prices have the greatest impact on project profitability; in coal-to-olefins projects, coal accounts for 35% of the cost of raw materials, while in methanol-to-olefins projects, methanol accounts for 75% of the raw material costs. In the first half of 2017, the overall profitability of coal-based olefin projects was better than that of methanol-based olefin projects. Coal-based olefin producers were actively preparing for second-phase projects, while methanol-based olefin producers focused on building new methanol plants to ensure stable raw material prices and supply for MTO processes. According to statistics from Yahuazhengxun, there are currently nearly 30 coal (methanol)-based olefin production projects under construction or in the planning stage in China. Of these, 15 projects are located in the western region, and most of them are integrated coal-to-olefins projects. The projects that have made the fastest progress in the preliminary stage include: Qinghai Mining, Shenhua Baotou Phase II, and Sinopec Great Wall Energy Chemicals’ Guizhou project, among others. The 600,000 tons per year polyolefin project of Sinopec Great Wall Energy Chemical (Guizhou) Co., Ltd. is located in Bijie, Guizhou. It uses local anthracite as raw material and employs powder gasification technology along with S-MTO technology to produce olefins. The facility also includes new units for producing 1.8 million tons per year of methanol, 1.8 million tons per year of olefins from methanol, 300,000 tons per year of linear low-density polyethylene, and 300,000 tons per year of polypropylene. The total investment for the project is 16.77 billion yuan. In June 2015, the **National Development and Reform Commission issued a document approving the project to be pursued as one of nine national demonstration projects for the olefin industry, assigning the Guizhou Provincial Development and Reform Commission with the task of approving the project. In February 2017, the project’s environmental impact assessment report was officially approved by the Ministry of Environmental Protection.