The bottleneck issues in modern coal chemical industry need to be resolved

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The bottleneck issues in modern coal chemical industry need to be resolved. Author/Source: Date: 2018-08-23 Clicks: 11. “Compared to diesel produced from crude oil, diesel obtained through direct coal liquefaction features a higher density, higher specific heat capacity, greater stability, and a lower freezing point. Its sulfur content is only 1/10 of the standard level, and it does not freeze at minus 60 degrees Celsius, making it an excellent environmentally friendly fuel.” ”Hu Qingbin, the deputy chief engineer of Shenhua Ordos Coal-to-Oil Branch, is well-versed in all the various parameters of coal-based diesel. 　　“With such high-quality oil, under current policies, it can only be sold at the price of products produced by local refineries in Shandong; these prices are generally nearly 1,000 yuan lower than normal prices. Especially given the low current oil prices, the operational pressure is quite significant. ”He changed the subject, looking helpless. 　　Reporters from the Economic Reference News have learned that the development of China’s modern coal chemical industry currently faces issues such as inadequate industrial policies and insufficient attention, and some key technologies and equipment are also dependent on foreign sources. Industry experts suggest that it is urgent to define the industry’s role from the perspective of ensuring **energy security and promoting the clean use of coal**, to improve relevant policies and accelerate development, thereby enhancing the strategic importance of the modern coal chemical industry in replacing oil to safeguard **energy security**. 　　Some core technical equipment remains dependent on foreign sources. Since the beginning of the new century, although China has made significant progress in the research and development of modern coal chemical technologies, equipment, and catalysts such as those used for converting coal into oil and olefins, with the majority of such technologies and equipment now being produced domestically, there are still some key technologies and equipment that remain dependent on foreign countries. 　　Hu Qingbin, deputy chief engineer of Shenhua Ordos Coal-to-Oil Branch, gave an example: Over the past 10-odd years, thanks to the construction and operation of the first million-ton per year coal direct-to-oil production line, domestic production of most key equipment such as pressure relief valves has been achieved; however, a few core pieces of equipment still rely on imports. 　　He gave the example of a type of circulation pump that is currently produced only by one company in the United States, and large industrial control systems that are essential for coal chemical plants also rely heavily on imports. 　　Large-scale gasifiers and air separation units, which are widely used in modern coal chemical enterprises, rely heavily on imports. Hu Weibo, deputy chief engineer at Zhongtian Hechuang Energy Co., Ltd., said that when the company purchased gasifiers produced by Texaco in the United States, it was required to acquire the company’s patents for water-coal slurry gasification technology as well. The large-scale air separation equipment used in modern coal chemical projects such as Yitai’s 1.2 million tons per year coal-based fine chemicals plant, HuiNeng’s coal-to-natural gas project, and Zhongtian Hechuang’s advanced coal processing project are all imported products. 　　The air separation unit for the first phase of the HuiNeng coal-to-natural gas demonstration project was purchased from Air Liquide in France; it utilizes synthetic patent technologies, equipment, and catalysts from Topsoe in Denmark, while the natural gas liquefaction unit makes use of patent technologies from German companies. Liu Jianqiang, general manager of HuiNeng Coal Chemical Co., Ltd., said that imported equipment is expensive, spare parts take a long time to arrive, and maintenance and service are inconvenient; therefore, the company plans to promote the localization of key technologies and equipment as much as possible in the second phase of the project. 　　It is understood that in recent years, Chinese enterprises have made significant progress in the manufacturing of large-scale air separation units. However, some enterprises believe that modern coal chemical projects require investments in the order of tens of billions of yuan, and there are few examples of the use of domestic equipment such as air separation units, with such use having only been implemented for a short period of time; therefore, they are reluctant to purchase domestic equipment on the grounds that its stability and reliability still need to be proven. 　　Industrial policies still need improvement. In our country, modern coal chemical technologies such as coal-to-oil and coal-to-natural gas have only been developed from the laboratory stage to industrial demonstration over the past 10 years or so; they are still considered new industries. At present, industry policies regarding product standards, pricing, and market access for modern coal chemical products such as oil and gas are still lacking or not fully developed, which hinders their development. 　　Zhang Donghai, chairman of Yitai Group, explained that in the process of coal indirect liquefaction for oil production, coal must first be gasified, and after treatments such as desulfurization and denitrification, it is then fed into processes like catalytic synthesis; as a result, the oil produced is more environmentally friendly compared to that produced by refineries. 　　He gave the example that diesel produced through indirect coal liquefaction contains no polycyclic aromatic hydrocarbons, with a sulfur content of less than 2 ppm, which is 1/5 of the national standard; its residual carbon and ash content are extremely low, making it colorless and transparent, and its purity is superior to that of Beijing 5 diesel. At present, the relevant departments in our country have not established quality standards for oils such as coal-derived diesel and naphtha. The selling prices are required to follow those set by local refineries in Shandong region, which fails to reflect the principle of better quality at higher prices, thus affecting the enthusiasm of enterprises. 　　“The direct coal liquefaction technology we have developed involves three hydrogenation steps during production, and this inherent technical advantage ensures that the resulting product is much purer than that produced by refineries, as well as having a higher quality. ”Hu Qingbin, deputy chief engineer of Shenhua Ordos Coal-to-Oil Branch, said that the company is currently facing the same problem of a lack of product standards to follow, and its products are sold at prices set by local refineries in Shandong. 　　Natural gas is suitable for pipeline transportation. Currently, pipeline companies only purchase natural gas for sale; they do not transport products from coal-to-natural-gas demonstration projects, and the purchase price is also much lower than the market price. 　　Liu Jianqiang, general manager of HuiNeng Coal Chemical Co., Ltd., said that if the company sells its products to pipeline companies, the purchase price per cubic meter of natural gas is only around 1.3 yuan; the purchase price for natural gas through pipelines in Xinjiang is even lower. This is one of the reasons why most coal-to-natural gas demonstration projects suffer losses. To this end, the company chose to liquefy natural gas and then transport it by truck to places such as Beijing, Hebei, Shandong, and Shaanxi for sale. 　　Modern coal chemical enterprises are mainly located in coal-rich areas such as Ordos City in Inner Mongolia, Lu’an City in Shanxi, Yulin City in Shaanxi, and Xinjiang. There are few local universities and research institutions in these areas, and with the development of the modern coal chemical industry, bottlenecks in terms of technology and talent have become increasingly apparent. 　　Liu Jianqiang, general manager of HuiNeng Coal Chemical Company, and other company executives said that the units responsible for the research, development, and manufacturing of the company’s technical equipment are located in cities such as Xi’an and Dalian, and many of the key technical personnel are also from outside the region. At present, Ordos City is facing the problem of having its operations dependent on external factors in the development of its modern coal chemical industry demonstration zone, as it still lacks **level research platforms. 　　With technological advancements, modern coal chemical enterprises are seeing a continuous reduction in their energy consumption, and wastewater is now being eliminated entirely. However, the current policies aimed at energy conservation and emission reduction are one-size-fits-all in nature, which hinders the development of modern coal chemical industry zones such as those in Ordos. 　　Wang Limin, deputy director of the Ordos Economic and Information Commission, said that the current energy-saving assessment policies do not distinguish between raw coal and fuel coal; as coal is converted into fuels and chemicals such as oil and natural gas, the regions where it is produced suffer disadvantages in terms of GDP-based energy consumption assessments. Furthermore, although individual enterprises meet the emission standards, the total emissions keep increasing once an industrial cluster is formed. “It is often said that coal-rich regions should not rely solely on coal; industries need to undergo transformation and upgrading, and deep processing of coal represents a practical approach, yet it faces constraints imposed by policies aimed at energy conservation and emission reduction. Coal mining and sheep herding require the least energy and generate the fewest emissions, but they do not meet the requirements for industrial upgrading. ” 　　Accelerate the pace of scaled development. China has a high level of energy consumption, which continues to rise year after year. Due to its resource profile featuring abundant coal but limited oil and gas reserves, the country imports large amounts of oil and natural gas each year. Last year, China’s crude oil imports exceeded 400 million tons, with its dependence on foreign oil surpassing 60%, making it the world’s largest importer of crude oil. Its dependence on foreign natural gas also approached 40%. 　　The increasing dependence on imported oil and natural gas from year to year, together with the characteristics of the international oil and gas supply and China’s energy structure dominated by coal, makes it crucial to develop a modern coal chemical industry in order to ensure energy security and promote the clean and efficient use of coal in China. 　　Compared with petrochemicals, modern coal chemical industries such as coal-to-oil, coal-to-gas, and coal-to-olefins are characterized by larger-scale facilities. The investment required for a production capacity of 10,000 tons is three times or even higher than that in petrochemicals; equipment depreciation is high, resulting in significant pressure to recover the investment. In particular, for coal-to-oil and coal-to-gas demonstration projects, the initial investment in technology research and development as well as industrial-scale demonstration is substantial and takes a long time; these projects generally face profitability pressures and thus require **policy support. 　　Many experts and business leaders believe that at present, most modern coal chemical projects are located in Inner Mongolia, including Ordos City; there are few projects and limited production capacity in other regions. It is urgent to give attention to the development of this industry from the perspective of ensuring **energy security and promoting the clean use of coal, to further clarify its role in the economy and improve relevant industrial policies. They suggest that, first, the relevant departments should focus on the bottlenecks in modern coal chemical production as well as in key environmental protection technologies and equipment, establish some **-level research platforms for modern coal chemistry, and increase scientific research support for industrialization demonstration zones in this field. 　　Second, accelerate the formulation and improvement of quality standards, pricing, and market access policies for modern coal chemical products such as coal-to-oil. Pricing should reflect the principle of better quality at a higher price, or a pricing mechanism based on costs plus a certain profit margin should be adopted. 　　Third, on the basis of scientifically planning the industrial layout, stable policies will continue to promote industrial demonstration, further expand the scale of these industries, and provide support for high-end projects in terms of project approval and financing. 　　Fourth, implement differentiated energy-saving and emission-reduction policies in modern coal chemical industry demonstration areas such as Ordos; when calculating energy consumption per unit of GDP, only fuel coal should be taken into account, thereby reducing the pressure associated with energy-saving and emission-reduction efforts in regions rich in coal resources during industrial upgrading. 　　Fifth, formulate policies to promote the integrated development of military and civilian applications in modern coal chemical industries such as coal-to-oil production, and provide support for the research, development, and sales of coal-based specialty oils.