The path toward integration for Shaanxi Coal Chemical Industry

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On April 23, the coal powder pyrolysis-gasification integrated technology (CCSI), independently developed by Shaanxi Yanchang Petroleum Group, passed the scientific and technological achievement appraisal organized by the China Petroleum and Chemical Industry Federation in Beijing. Experts believe that this technology achieves a high yield of coal tar and efficient gasification of semi-coke powder. Li Shousheng, president of the China Petroleum and Chemical Industry Federation, spoke highly of Yanchang Petroleum Group’s efforts to develop coal chemical industry at a higher level. In fact, this project is merely a microcosm of the integration of coal chemical industries with related sectors in Shaanxi, a province rich in coal resources, as part of the effort to make full use of every aspect of coal. Pursuing differentiated and diversified development, CCSI technology is a unique technology independently developed by the Hydrocarbon Research Center of Yanchang Petroleum Group. This technology produces coal tar and crude syngas in one step through the pyrolysis and gasification of pulverized coal. “The CCSI technology does not aim for the complete conversion of coal in a single unit process, but rather focuses on maximizing the overall conversion efficiency and energy utilization rate. The pyrolysis reaction and gasification reaction within the reactor form a closed cyclic system, where heat and materials are exchanged between the two processes. This results in low energy consumption and high resource utilization, as well as comprehensive treatment and centralized discharge of pollutants during the conversion process. ”Li Dapeng, a leading expert at Yanchang Petroleum Group, said that this technology can be integrated with technologies such as carbon-based chemical manufacturing and clean power generation to create a new model of combined production of coal, oil, gas, and electricity, thereby producing high-value-added products. Similar to Yanchang Petroleum Group, companies such as Shaanxi Coal and Chemical Industry Group are also continuously innovating in the field of coal chemical processing, having developed a series of technologies including full fraction hydrogenation of coal tar (FTH) and solid heat carrier dual-cycle rapid pyrolysis for low-rank pulverized coal gas (SM-SP). These technologies have enabled a transition from relying solely on coal to a model of moderate diversification, further evolving toward differentiated and diversified development. As a result, Shaanxi Coal and Chemical Industry has transformed into a company with a strong coal-based advantage and prominent operations in the energy and materials sectors. The chemical industry sector focuses on developing advanced processing of tar, coal-based olefins, coal-based ethylene glycol, new materials in polymer chemistry, as well as high-end fine chemical products. In mid-February, President Li Shousheng and his delegation, while conducting inspections at coal chemical enterprises in Shaanxi, pointed out that Shaanxi possesses unique advantages in terms of its various resources, as well as the necessary conditions for the integrated development of multiple industries. It is necessary to adhere to the comprehensive utilization of coal, oil, and gas resources. Through integrated innovation in process technologies, the shortcomings of single coal chemical and petrochemical industries in terms of raw material composition and hierarchical utilization of resources can be addressed, thereby achieving coupled development of these industries and making the most of these resources. At the same time, coal chemical enterprises must possess unique core technologies; their end products should be of high quality and differentiated, production costs need to be controlled, and core competitiveness must be enhanced. On April 28, Wei Jundong, the mayor of Yulin City, said at a press conference held by the Information Office of Shaanxi Province that Yulin would work to extend its industrial chains, focusing on two main areas: the differentiated utilization of coal and coal-based fine chemicals. The city aims to develop three circular industrial chains: coal – semi-coke – coal tar – high-end petroleum products; coal – methanol – olefins (aromatics) – synthetic materials; and coal – coal liquefaction – fine chemicals. By doing so, it seeks to expand coal chemical products into synthetic fibers, synthetic resins, synthetic rubber, and other high-value downstream products, thereby creating specialized clusters for coal chemistry and fine chemicals industries. At the same time, successor industries are being developed; around the coal mining–power generation–new materials industry chain, a new materials industry base with global competitiveness is being created ； Build a new energy industry base with a capacity of tens of millions of kilowatts around the industrial chain of coal power – polysilicon – solar cells – photovoltaic power generation ； Introduce and deploy a number of emerging industry projects in areas such as big data, the Internet of Things, and graphene to foster new drivers of growth. It also implements an innovation-driven strategy, focuses on research and development of key technologies such as the clean utilization of coal based on its different quality levels, and introduces disruptive technologies like the production of olefins from acetylene and the production of ethanol from syngas. Coal is expanding into chemical products; Shaanxi’s coal chemical industry focuses on northern Shaanxi. This is a **major energy and chemical industry hub that is given priority for development; it serves as a base for transporting coal from the west to the east, electricity from the west to the east, and gas from the west to the east. It boasts resources such as coal, oil, natural gas, and rock salt, and features coal production facilities with an output of over 100 million tons as well as domestic production facilities for coal-to-methanol. It is also an important demonstration site for modern coal chemical industry in China.** In recent years, the Northern Shaanxi Energy and Chemical Industry Base has focused on converting coal into chemical products. At present, the production capacity of semi-coke in Yulin’s coal chemical industry has exceeded 50 million tons. Ten coal-to-oil projects utilizing various processes such as coal indirect liquefaction, direct liquefaction (co-refining with kerosene), and coal tar hydrogenation have been built, with a total production capacity of 2.75 million tons ； The production capacities for coal-based olefins, coal-based methanol, and coal-based acetic acid are 2.4 million tons, 2 million tons, and 350,000 tons respectively ； The world’s first 10,000-ton-per-year methanol-to-aromatics plant, as well as the world’s first project for the comprehensive utilization of coal, oil, and gas along with coal oil co-refining, have been built and put into operation. Major breakthroughs have been achieved in key technologies such as the differentiated and graded utilization of coal and the hydrogenation of coal tar; some of these advancements are even at the world’s leading level. Hu Haifeng, a member of the Decision-making Advisory Committee of Shaanxi Province, and Wu Gang, deputy director of the Economic Research Institute of the Shaanxi Academy of Social Sciences, believe that during the 12th Five-Year Plan period, Shaanxi’s coal chemical industry achieved significant development. Basic chemical raw materials such as methanol, ethylene, and propylene were developed from scratch and saw substantial growth, filling the gap caused by the weak development of this sector over the years. However, there is severe homogenized competition among coal chemical products in Shaanxi, and the product structure is not entirely rational. In particular, the sector of fine chemicals and new chemical materials is weak; low-end products from coal chemistry account for a large proportion, and the industrial chain is short. High-value-added chemical materials and fine chemicals for downstream use still rely on imports, so there is an urgent need to transform and adjust the product structure. For example, Shaanxi has the largest production capacity for coal-based olefins in the country, but its products are all ordinary polyethylene and polypropylene; there is a severe shortage of polyolefins with high molecular weight, high strength, high toughness, and those designed for special applications. Therefore, pursuing full utilization of coal from start to finish is an important goal for the upgrading of Shaanxi’s coal chemical industry. Fostering a complete industrial chain in the energy and chemical sector: Not long ago, the Shaanxi Provincial Development and Reform Commission issued the \"13th Five-Year Plan for the Sustainable Development of Northern Shaanxi’s Transformation.\" This plan calls for the development of a diversified industrial structure, with an emphasis on enhancing competitiveness through the production of higher-quality products. It also aims to accelerate the adoption of key new technologies such as integrated conversion of coal, oil, and gas resources, co-processing of coal and oil, integrated extraction of coal tar and synthesis of syngas from coal, production of butylene and propylene from methanol, conversion of coal to aromatics via methanol, and production of ethanol from syngas. By 2020, it is planned that the rate of on-site conversion of coal will exceed 50%, the total installed capacity for power generation will double, and non-energy industries will account for more than 25% of the industrial sector. Industries such as energy equipment and modern logistics are expected to become key sectors, thereby forming a modern industrial system characterized by energy chemistry and featuring diversity. In the effort to develop the entire coal-to-energy industry chain, the Northern Shaanxi Energy and Chemical Industry Base will adopt a diversified development approach that focuses on optimizing coal utilization, stabilizing oil production, expanding gas utilization, and strengthening industrial processing. It will accelerate the development of technologies for the clean exploitation of coal, achieve efficient and green mining practices, and promote the clean and efficient conversion of coal ； Stabilize crude oil production and develop an integrated oil and gas industry covering drilling, extraction, refining, and petrochemical processing ； Accelerate research and development of key technologies for the exploitation of tight gas and shale gas; establish first-class onshore shale gas demonstration zones in Yan’an; develop natural gas exploration and production projects in Changqing, Yan’an, and Sinopec, as well as demonstration projects for shale gas exploration and production in Yan’an; intensify the exploration of coalbed methane in mining areas such as Wubao, Fugu, and Huangling; and steadily increase natural gas production capacity. The Plan also proposes to promote the clean and efficient use of resources and improve the efficiency of comprehensive energy utilization ； Improve the level of carbon dioxide capture, storage, and utilization, as well as the reduction and reuse of industrial waste streams, to achieve efficient and low-emission circular development ； Advance the innovative development of renewable energy, and accelerate the construction of demonstration projects for new energy utilization on abandoned desert lands such as coal mine voids ； Promote the integrated development of industries, driven by technological progress and linked through the interconnection and sharing of energy resources. Accelerate industrial upgrading and transformation, and foster the integrated development of non-ferrous metallurgy with energy chemicals and equipment manufacturing. Focus on establishing multiple industrial chains such as coal–lignite–ferrosilicon–magnesium–magnesium processing, coal–electricity–aluminum–aluminum-magnesium alloy processing, and coal–electricity–silicon materials, while advancing the integration of coal chemistry with industries such as building materials, power generation, and metallurgy. Chemical industry expert Guo Weidong believes that the development of industrial clusters such as coal chemical industries in northern Shaanxi can involve the creation of public gasification islands at the sites of large-scale coal chemical and coal power plants, as well as within industrial parks, along with utility infrastructure islands; this approach can help reduce the production costs for enterprises and the investment costs associated with projects. Wu Gang suggested that northern Shaanxi should promote the greening of the energy and chemical industry, as well as the reduction of carbon emissions in high-carbon industries, through the integrated production of oil, gas, coal, and salt ； High-end development entails the creation of high-quality products, including downstream chemicals derived from olefins, new types of carbon materials, and polyester fiber products, in order to enhance the capability of high-end materials to support downstream industries and build a high-end industrial chain ； In terms of the intelligent upgrading approach, it is necessary to vigorously develop industries related to the energy internet, such as Internet-based oil and gas solutions, Internet-based energy sensing technologies, Internet-based energy storage systems, and smart microgrids, in order to create new growth points for emerging industries ； The capacity cooperation model aims to support and facilitate energy and chemical enterprises in connecting with countries and regions along the Belt and Road Initiative, encouraging companies in the fields of oil refining, tires, coal chemicals, and chlor-alkali industries to expand their operations abroad through cross-border investments and project contracting” ； A niche market, also known as a small-market segment, refers to a situation in which a company focuses on a very specific area of products or services, commits resources to becoming a leader in that area, and may even emerge as the dominant player there. “Yulin already possesses the foundation and conditions for the advanced development of the coal chemical industry. Through process upgrades, product improvements, technological advancements, and enhancements to industrial chains, this industry can be developed in a way that features high technology content, high added value, and high efficiency – and this is indeed the direction in which it should move forward. ”Zhang Xiangping, director of the Yulin Coal Chemical Industry Upgrade Technology R&D Center, said. For example, achieving a higher level of sophistication through process upgrades involves optimizing and improving the existing production processes for products such as lignite coke, methanol, vinyl chloride, metallic magnesium, and mixed alcohols, thereby enabling the industry to develop in a cleaner, lower-energy-consuming, more efficient, and more profitable manner ； To achieve high-end development through product upgrades, it is necessary to use the existing products, intermediates, by-products, and waste materials from the coal chemical industry as raw materials. Guided by market demands, special waxes, anthracite-based adsorption materials, functional materials, aromatic chemicals, catalysts, as well as high-end coal chemical products such as food-grade carbon dioxide, methane, formic acid, and polymer materials (polypropylene carbonate, polycarbonate) should be developed and produced.