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Coal-based olefins face challenges from the methane route Author/Source: China Chemical Industry News Date: 2017-09-06 Clicks: 42 In recent years, the development of coal-based olefins industry in China has been rapid; 27 such projects have been completed, with a total olefin production capacity of 14.15 million tons. There are another 50 projects under construction or planned, with a production capacity of around 26.43 million tons. On the other hand, the coal-based olefins industry is also facing various challenges. The economic challenges are evident: with olefin prices remaining low and coal prices continuing to rise, the profit margins for coal-based olefins are extremely slim, and many companies even end up in the red. Meanwhile, coal-based olefins are facing competition from other technological approaches, particularly methane-to-olefins technology. The methane route is cheaper. At present, over 90% of ethylene produced abroad comes from the cracking of naphtha and ethane, while in China it is mainly obtained from the cracking of naphtha and methanol. As oil resources become increasingly scarce, there is an urgent need to find new alternative sources. Currently, there are two approaches to replacing oil, both domestically and internationally: in China, emphasis is placed on leveraging the country’s coal-rich resources to develop modern coal chemical industries, while abroad, more attention is given to methane in natural gas. In our country, coal resources are relatively inexpensive; using coal to produce methanol and then obtaining olefins through methanol cracking is an excellent approach. This is a significant achievement resulting from domestic research and industrialization success, and it has had a major impact on China’s ethylene industry. However, as the world’s third-largest energy source after oil and coal, natural gas is easy to extract and inexpensive. In recent years, as China’s natural gas exploration reserves have expanded, along with the successful exploitation of unconventional gases such as shale gas and coalbed methane, the shortage of natural gas resources has been significantly alleviated. If ethylene could be produced directly from methane, the main component of natural gas, the cost of the product would change significantly. It is estimated that this technology can reduce the cost of ethylene by at least 700 to 2,200 yuan per ton. If new plants for directly converting large amounts of methane into olefins are built around the world, many naphtha cracking plants will close, and coal-based olefin production technology will also suffer a severe impact as a result. Significant breakthroughs have been achieved in technology. Technically, there are two approaches for the direct conversion of methane into ethylene: oxidative coupling and non-oxidative coupling, and these methods are moving toward industrial application. Once it becomes a reality, it will enable more convenient and widespread use of natural gas, which is of great significance. Studies show that the economics of the oxidative coupling process depend not only on the prices of the feed gases and ethylene, but mainly on the methane conversion rate, the yield of dicarbons, and the selectivity for dicarbons. For example, to truly achieve the industrialization of the methane oxidation coupling process, it is required that the one-pass conversion rate of methane be above 35%, the yield of dicarbons be above 30%, and the selectivity for dicarbons be above 85%. Currently, the oxidation coupling approach is advancing at a rapid pace. In 2010, the American company Siluria made significant progress in catalyst technology, developing a nanoparticle catalyst that enables the direct oxidation coupling of natural gas to produce ethylene in just one step. Ciluria also claims that its demonstration plant in Texas has been operating continuously since 2015, having undergone at least 15 testing campaigns and generating data from a pilot plant. The successful operation of the demonstration unit proves the feasibility of this technology. The next phase for this company will involve the construction of a commercially scaled methane-to-ethylene plant with a capacity of around 75,000 tons per year to 1 million tons per year. Another route for the direct production of olefins from methane is the non-oxidative coupling method, which can produce olefins and aromatics. At present, our country has made certain progress on this topic. The catalytic process for producing olefins and aromatics from non-oxygen sources, developed by the team led by Academician Bao Xinhe from the Dalian Institute of Chemical Physics, Chinese Academy of Sciences, enables the selective activation of methane under anaerobic conditions, allowing for the efficient one-step conversion of it into high-value chemicals such as olefins, aromatics, and hydrogen. The reaction process itself does not emit carbon dioxide, and the utilization efficiency of carbon atoms reaches 100%. Since its first report in the American journal Science in May 2014, researchers around the world have conducted in-depth and systematic studies on the fundamental scientific issues underlying this process as well as on industrial technology development, achieving a series of breakthroughs in areas such as improving catalyst stability, optimizing catalyst preparation methods, and designing new types of reactors. Coal chemical enterprises need to respond proactively. The technology for directly converting methane into olefins is a disruptive innovation in the chemical industry with far-reaching impacts. In the near future, new technologies may lead to the closure of a large number of traditional ethylene plants, resulting in a significant drop in the cost of ethylene products. For the vast majority of enterprises in our country that use naphtha cracking technology, this means a loss of cost advantages ； It is an even more severe challenge for coal-based olefin technologies, whose costs are higher than those of naphtha cracking technology. Of course, our country’s natural gas resources are not yet sufficient to support the construction of large-scale methane oxidation coupling and non-oxidation coupling facilities, and these two technologies are still some way off from being put into industrial use; nevertheless, the coal chemical industry should remain vigilant. Currently, across the country, a large number of ethylene cracking plants that use coal, methanol, and naphtha as raw materials are being built, with ever-larger scales and an increasing number of such plants; the total production capacity is at least 20 million tons per year. But when the new technology for producing olefins from methane becomes available, will traditional naphtha cracking and methanol-based technologies for producing low-carbon olefins be able to compete successfully? Currently, most coal-to-ethylene plants are located in economically underdeveloped areas inland. Given the difficulties of transportation and the needs of regional economic development, there is still a market and a long lifespan for producing ethylene from coal in the interior areas. However, the methanol-to-ethylene plants along the coast will be impacted by new technologies. The payback period for facilities using the methanol-to-ethylene route is roughly between 10 and 12 years, but with new technologies emerging constantly, can they hold on to the market? The coal chemical industry needs to give serious consideration to these two issues. The coal chemical industry needs to address this challenge; in addition to reducing the investment and costs associated with the process of producing ethylene from coal via methanol, it is also necessary to develop new technologies to enhance its competitiveness. Currently, our country is researching technologies for the direct production of olefins from syngas with high selectivity under mild reaction conditions. Given the relatively low cost of coal and its abundance in our country, and with the advancement of coal gasification technology, this approach remains promising.