The near and far of modern coal chemical industry

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The Near and Far Future of Modern Coal Chemical Industry / Author/Source: Fu Xiangsheng, Vice President of the China Petroleum and Chemical Industry Federation, Sinochem News Network. Date: June 13, 2019. Views: 13. Fu Xiangsheng, Vice President of the China Petroleum and Chemical Industry Federation: Given China’s resource profile of abundant coal but limited oil and gas reserves, and in order to advance the energy revolution as well as ensure energy strategic security, a modern coal chemical industry that is now among the best in the world has been developed. Through years of innovation and development, China’s modern coal chemical industry has made breakthrough progress; the level of some key technologies is now among the best in the world. Moreover, valuable experience and data have been accumulated, providing a foundation for deepening the energy revolution in China, strengthening energy security strategies, as well as promoting complementary and coordinated development between the coal chemical and petrochemical industries. 　　Amidst the downward pressure on the global economy and the increasing uncertainties in the international economic environment, the difficulties and challenges faced by the development of modern coal chemical industries have become more complex and varied, and the future progress of this industry encounters numerous obstacles. The future of modern coal chemical industry lies in high-quality development. Both the short-term and long-term prospects, as well as the present and future of this industry, deserve our careful consideration!
A very brief history of the chemical industry and coal chemical industry
In the early 19th century, breakthroughs were made in chemistry and chemical engineering technologies. The 20th century saw a period of rapid development for the chemical industry, which played an extremely important role in human and societal progress. 　　The world’s population has increased significantly, yet humanity has been freed from the scourge of hunger, and life expectancy has **increased** – all thanks to advances in chemical and chemical engineering technologies. The colorful and stylish clothes people wear, as well as the attractive living environments, are all the result of synthetic fibers, dyes, coatings, and pigments produced by the chemical industry. The convenience of traveling by car, high-speed trains, and airplanes is made possible by synthetic materials and their composites developed by the chemical industry. Human missions to the Moon, space exploration, and deep-sea diving are all made possible by new chemical materials, specialty chemicals, and special sealing materials. It can even be said that the more than 70 years of world peace that humanity has enjoyed since World War II is also a blessing resulting from advances in chemical technology, which enabled humanity to master nuclear fusion and use it for peaceful purposes. 　　The early days of the chemical industry began with coal chemistry. Initially, the industrial production of synthetic dyes was initiated from the components of coal tar. This not only brought a variety of colors to people’s lives, but also made purple no longer exclusive to the nobility. The production of coal gas and synthetic ammonia led to the development of the fertilizer industry, which has benefited agriculture and humanity. Through acetylene chemistry derived from calcium carbide, polyvinyl chloride materials and a range of organic chemicals were developed. Furthermore, via methanol production from coal and C1 chemistry, a series of products such as carbonylation acetic acid, formic acid, and polyvinyl alcohol emulsion (used in fibers) were created. 　　After World War II, as the production of oil and natural gas continued to increase, the petrochemical industry entered a golden age. In particular, rapid advancements in technology and innovation within this sector gave it greater advantages and market competitiveness. Globally, the production of synthetic ammonia and methanol using natural gas quickly surpassed that using coal. Polyvinyl chloride, which was produced via the calcium carbide-acetylene process, was replaced by the ethylene oxychlorination method. Succinic anhydride and phthalic anhydride, which were originally made from benzene and naphthalene derived from coal tar, were substituted by products obtained from light hydrocarbons and o-xylene in the refining process. Today, over 80% of petrochemical products and over 90% of organic chemicals come from the petrochemical industry, which uses oil and gas as raw materials. 　　The coal chemical industry is limited to China and South Africa on a global scale. South Africa developed its own coal chemical industry due to a severe shortage of crude oil, abundant coal resources, as well as international embargoes in the last century. With the current lifting of international embargoes, the focus of South Africa’s coal chemical products has shifted from petroleum products to chemicals. Given that China is rich in coal but lacks oil and natural gas, and its dependence on foreign oil and natural gas continues to rise, efforts to deepen the energy revolution and ensure **energy strategic security have led to the development of today’s world-leading modern coal chemical industry. 　　The Current Status of Modern Coal Chemical Industry Modern coal chemical industry is used in contrast to traditional coal chemical industry. Traditional coal chemical industry generally includes the calcium carbide and acetylene product chain that uses coal as a raw material, the methanol and C1 chemical products chain also based on coal, as well as the fertilizer industry chain that involves coal gasification for ammonia production, which is well-known to everyone. Modern coal chemical industry refers to the sector that uses coal as a raw material, along with advanced technologies and processing methods, to produce alternatives to petrochemical products and clean fuels. Current applications include coal-to-oil, coal-to-natural gas, coal-to-olefins, and coal-to-ethylene glycol; in the past couple of years, further developments have been seen in areas such as coal-to-aromatics and coal-to-ethanol. 　　Through years of innovation and development, especially during the 13th Five-Year Plan period, thanks to the industrialization and upgrading initiatives in the four modern coal chemical industry demonstration zones designated under the \"Plan for the Innovative Development of the Modern Coal Chemical Industry\" – Ordos in Inner Mongolia, Yulin in Shaanxi, Ningdong in Ningxia, and Zhundong in Xinjiang – significant progress has been made in modern coal chemical technology. The level of key technologies such as coal-to-oil, coal-to-olefins, and coal-to-aromatics is now among the best in the world, and valuable experience in engineering implementation and industrialization, along with practical operation data, has been accumulated. 　　According to statistics from the Coal Chemicals Special Committee, in 2018, the scale of the modern coal chemicals industry as well as the long-term stable operation of its facilities improved steadily. Energy consumption, water consumption, and emissions of various waste types decreased, while the level of product differentiation improved. The total investment in the four main categories of projects utilizing coal for oil production, gas production, olefin production, and ethylene glycol production amounted to approximately 526 billion yuan; these projects produced 18.283 million tons of key products, with around 95.6 million tons of coal being converted each year. 　　Among them, the total production capacity for coal-to-oil conversion in 2018 was 9.21 million tons per year; the annual output was 6.175 million tons, an increase of 2.948 million tons compared to the previous year, representing a growth rate of 91.4%; the capacity utilization rate was 67.0%. The nine operational projects have seen a total investment of approximately 146 billion yuan; in 2018, they processed around 29.6 million tons of coal. 　　In 2018, the total production capacity for coal-to-gas production was 5.105 billion cubic meters per year; the actual output for that year was 3.01 billion cubic meters, an increase of 0.38 billion cubic meters compared to the previous year, representing a growth rate of 14.4%. The capacity utilization rate was 59.0%, up by 7.5 percentage points from the previous year. The four operational projects have seen a total investment of approximately 68 billion yuan; in 2018, they processed around 9.9 million tons of coal. 　　In 2018, the new production capacity for olefins produced from coal (methanol) was 600,000 tons per year, bringing the total capacity to 13.02 million tons per year (of which 8.72 million tons came from coal-based olefin production). The annual output was 10.85 million tons (7.625 million tons of which were from coal-based olefin production), an increase of 914,000 tons compared to the previous year, representing a growth rate of 9.2%. The capacity utilization rate was 83.3% (87.4% for coal-based olefins), an increase of 3.3 percentage points compared to the previous year. The 13 coal-to-olefins production projects have seen a total investment of around 269 billion yuan, with approximately 47.3 million tons of coal being converted in 2018. 　　In 2018, 8 new production projects for producing ethylene glycol from coal (syngas) were put into operation, adding 1.74 million tons per year to the production capacity, which rose to a total of 4.38 million tons per year – an increase of 65.9%. The annual production volume was 2.435 million tons, representing an increase of 899,000 tons compared to the previous year, or a growth rate of 58.5%; the capacity utilization rate was 55.6%. The 20 operational coal (syngas)-based ethylene glycol production projects have seen a total investment of around 43 billion yuan; in 2018, they processed approximately 8.8 million tons of coal. 　　Challenges in Modern Coal Chemical Industry 4.jpg Fu Xiangsheng is conducting research in coal chemical enterprises. (Photographed by Yan Junrong, our newspaper’s reporter) Amidst the downward pressure on the global economy and the increasing uncertainties in the international economic environment, the modern coal chemical industry faces increasingly complex and varied difficulties and challenges. In addition to fluctuations in international crude oil prices caused by factors such as the international political landscape, power struggles between major countries, and regional instability, as well as the high water consumption and the one-size-fits-all policies restricting the use of coal as a raw material, the future development of modern coal chemistry is also confronted with three prominent challenges: The first is the challenge related to large-scale industrialization technologies. Progress in modern coal chemical technology has been significant, and this is why developed countries and multinational corporations pay close attention to the development of modern coal chemistry in our country. Technological innovation continues to make progress: both the direct and indirect methods for converting coal into oil are at the international leading level. Last year, Hualu Hengsheng successfully commissioned a 500,000-ton/year production facility for producing ethylene glycol from coal. In terms of high-temperature Fischer-Tropsch synthesis technology, the first industrial demonstration plant with a capacity of 100,000 tons/year was built, and it operated successfully from the very first batch of feedstock used; in April of this year, experts determined that this technology had reached the international leading level. Under the leadership of Academician Liu Zhongmin, continuous innovations have been made in coal-based olefin production technology, with the third generation of such technology now developed – featuring a methanol consumption of 2.7 tons per ton of product, an olefin yield of 80.23%, as well as reduced energy and water consumption. Significant progress has also been achieved in technologies such as extended coal-oil-gas co-processing, as well as Shaanxi Coal Chemical’s technology for the selective utilization of low-grade coal. 　　However, many of these are breakthroughs in individual technologies, while there is a significant gap in large-scale integrated technologies; in the past, many \"end-to-end\" technology development projects were organized to address such issues. Looking back now, industrial trials and demonstration projects have been carried out; often, individual technologies are at an advanced level, but the integration of these technologies and the availability of key equipment remain bottlenecks. Take coal-to-olefins as an example; it is a typical representative of modern coal chemical projects, with the highest operational rate and the best economic benefits. However, looking at the entire process of the existing plants: the methanol-to-olefins units all utilize the MTO or DMTO technology developed by Academician Liu Zhongmin from Dalian Institute of Chemical Physics. As for gasification technology, some plants use domestic multi-nozzle coal slurry gasification technology or pressurized pulverized coal gasification technology, while others employ the coal slurry gasification technology provided by the American company GE. Gas purification is carried out using the low-temperature methanol washing technology from the German company Linde. The methanol synthesis process makes use of technology from the British company Davy, while olefin separation is achieved through technology provided by the American companies ABB Lummus and Univation. Polypropylene production relies on technology from the American company Dow or Ineos’ gas-phase polymerization process, high-density polyethylene is produced using Ineos’ slurry loop reactor technology, and linear low-density polyethylene is manufactured through Univation’s gas-phase fluidized bed polymerization process. These are the various challenges that lie ahead of us. 　　The second is to address the challenge of carbon emissions resulting from climate change. Global climate change is one of the most complex challenges facing humanity in the 21st century. The Paris Agreement reached at the United Nations Climate Change Conference provides a roadmap for global cooperation in addressing climate change after 2020. Around 34 billion tons of CO2 are emitted into the atmosphere worldwide each year, far exceeding the natural capacity of the environment to maintain balance. Reducing CO2 emissions resulting from the use of fossil resources, and thereby lowering CO2 concentrations in the atmosphere, has become a major challenge for the whole world. Given that coal has always been the main component of China’s energy structure, in recent years China has had the highest total CO2 emissions among all countries. Consequently, China faces tremendous international pressure to reduce its CO2 emissions. Given that our country has submitted to the United Nations a plan for China’s approach to addressing climate change, and has committed to reaching a peak in CO2 emissions by 2030 as well as reducing emissions per unit of GDP by 60%~65% compared to 2005 levels, this is an issue that requires close attention. Furthermore, as our country is actively piloting and exploring the establishment of a carbon trading market, enterprises with high carbon emission levels such as those in the refining, fertilizer, and coal chemical industries will be the first sectors in the petrochemical sector to be included in this carbon trading market. This issue cannot be ignored; if not handled properly, it will severely hinder the development of the modern coal chemical industry. 　　Third is the challenge of the rapid development of refining and chemical integration. China is now the second-largest petrochemical country and the largest chemical industry country in the world. The Chinese petrochemical industry contributes around 38% to the growth of the global petrochemical industry. In 2017, the 13 million tons per year production facility of CNPC in Yunnan and the 10 million tons per year production facility of CNOOC in Huizhou came online respectively; in that same year, China accounted for 70% of the world’s new oil refining capacity. Dalian Hengli’s plant with a capacity of 20 million tons per year began operating on December 15, 2018, and was fully operational by May 17 of this year. The equipment installation for Zhejiang Petrochemical’s first phase, also with a capacity of 20 million tons per year, has been completed, and work is underway to finalize the project; it is set to go into operation in the near future. Jiangsu Shenghong’s integrated plant with a capacity of 16 million tons per year, as well as CNPC’s Jieyang facility, both started operations before the end of the year. Sinopec’s Zhenhai Phase II project, the Gulei refining and chemical complex, as well as the facilities in Nanjing, Shanghai, and Maozhan are all under construction. New projects such as ExxonMobil’s Daya Bay project, BASF’s Zhanjiang new materials project, and the Yangba Phase II project are all in the process of preparation. 　　Modern coal chemical industry and petrochemical industry merely differ in raw materials; their product structures both fall within the petrochemical product chains such as oils, olefins, and aromatics. Consequently, market competition between them will lead to similar outcomes. Taking olefins as an example, according to the “2019 Early Warning Report on the Production Capacity of Key Chemical Products”, ethylene production capacity is expected to increase by 5 million tons per year in 2019, bringing the total capacity to 30.5 million tons per year. The next five years will see a surge in the commissioning of new ethylene production facilities; it is projected that by 2025, China’s ethylene production capacity will exceed 50 million tons per year. Should there be breakthroughs in projects involving ethane cracking to produce ethylene, this capacity is likely to rise even further. In 2019, the production capacity for propylene is set to increase by 4–5 million tons per year, bringing the total capacity to over 40 million tons per year. Based on projects that are under construction or planned, the total capacity is expected to reach 56 million tons per year by 2025; if the 45 propane dehydrogenation projects that have been announced and are under construction are completed as scheduled, the total capacity will exceed 62 million tons per year. 　　As for the other two related products, ethylene glycol will see an additional production capacity of 6 million tons per year over the next one or two years, thanks to the commissioning of large-scale integrated refining and chemical plants. By 2020, the total production capacity will reach 16.62 million tons per year, with an apparent consumption level of around 17.1 million tons, resulting in a roughly balanced situation. If all the planned projects are completed, the total production capacity will reach 22 million tons per year by 2025, and the apparent consumption level at that time will be 22.3 million tons. Multiple plants for producing p-xylene (PX) are set to come online in the near future, with an additional production capacity of 8.96 million tons per year added this year, bringing the total capacity to 22.75 million tons per year. Currently, there are 11 projects under construction, with a combined production capacity of 20.8 million tons per year; another 6 projects are planned, with a capacity of 10.6 million tons per year. By 2025, the total production capacity will reach 44 million tons per year, at which point production and consumption will reach saturation levels. 　　The Future of High-Quality Development in Modern Coal Chemical Industry China’s economy has shifted from a phase of rapid growth to one of high-quality development, and it is currently in a critical period focused on transforming the mode of development, optimizing the economic structure, and shifting the drivers of growth. At the 2019 Petrochemical Industry Development Conference held in April this year, Li Shousheng, president of the Petrochemical Federation, stated in his report that \"China’s petrochemical industry is entering a new phase of high-quality development,\" and this assessment was endorsed by the experts and ministry officials present. 2019 was a crucial turning point as China’s petrochemical industry entered a new phase of transformation and development, marking a year of high-quality growth for the sector. The future of modern coal chemical industry also lies in high-quality development, and such development should adhere to and emphasize the following principles and key points: First, experience and lessons are essential for the future of modern coal chemical industry. It is essential to thoroughly summarize the experiences gained from upgrades and demonstrations since the 13th Five-Year Plan period. The \"Plan for the Innovative Development of the Modern Coal Chemical Industry\" states that although significant breakthroughs have been achieved in modern coal chemical technology, it still does not meet the conditions for large-scale industrialization. The level of system integration and pollution control technologies need to be improved, the stability and economic viability of production must be verified, and industry standards and market systems require further development. At present, the modern coal chemical industry as a whole is still in the stage of upgrading and demonstration. “With only one year left in the 13th Five-Year Plan period, preparations are underway to launch the new development plans for the national economy, various industries, and regions under the 14th Five-Year Plan. Before addressing the question of whether modern coal chemical industry should be developed on a large scale, I believe it is essential to first answer a prerequisite question: “Have our upgrading and demonstration efforts achieved the desired goals?” This is a very important fundamental task and a basic prerequisite that is absolutely essential! For example, what are the results in terms of planning and establishing demonstration zones for modern coal chemical industries, accelerating the integrated development of related industries, overcoming key technical barriers in certain areas, improving the level of system integration and optimization, and enhancing the capability to provide complete sets of technical equipment? How effective are the measures taken to enforce strict requirements for project construction, standardize approval procedures, ensure rational allocation of resources, and strengthen supervision in terms of safety and environmental protection? In particular, what is the operational rate, stability, and economic competitiveness of the demonstration facilities? Key aspects such as the demonstration of industrial technologies and core equipment, the effectiveness of industrial integration, the levels of emissions of various waste types and the measures taken to address them, as well as the requirements regarding environmental standards, all need to be carefully analyzed within the context of the international petrochemical industry as a whole. It is necessary not only to summarize the achievements but also to identify the existing gaps. With this work properly carried out, we can then address the question of how the modern coal chemical industry can develop on the basis of upgrading and setting examples. In what areas does it need improvement, and which shortcomings must be addressed? Secondly, technological innovation is the key to the future of modern coal chemistry. Technological innovation in the field of modern coal chemical industry is one of the key priorities among the five major strategic innovations in the petrochemical industry during the 13th Five-Year Plan period. As mentioned earlier, the modern coal chemical industry faces challenges and constraints related to key technologies; in particular, there is a significant gap in innovation regarding large-scale industrialization technologies and major equipment. As the next step, on the basis of enhancing original innovation and technological innovation in key core areas, emphasis should be placed on integrated innovation and the development of complete industrialization technologies as well as their optimization level. Continuous efforts should be made to improve new gasification technologies, MTO and DMTO technologies, coal direct/indirect liquefaction technologies, gas purification technologies, large-scale low-pressure methanol synthesis technologies, and the quality of related major equipment. We cannot build the industrial-scale facilities of the modern coal chemical industry, which is recognized worldwide as being at the world’s leading level, on a foundation of \"generic\" technologies and key equipment, or even by piecing things together. Can we envision establishing demonstration plants during the 14th Five-Year Plan period that rely entirely on indigenous technologies and equipment, enabling upgrades across the entire process from gasification to olefin polymerization? It seems that we already possess the necessary foundation and conditions for this; scientists and engineers engaged in technological innovation should have such goals, and entrepreneurs in the modern coal chemical industry should as well! Therefore, in terms of innovation, it is necessary to carefully summarize the experiences and lessons gained from these demonstration projects, identify the strengths and weaknesses, and focus efforts on overcoming those \"bottleneck\" technologies that hinder the high-quality development of the modern coal chemical industry, as well as on developing technologies to address these weaknesses and even disruptive technologies. It is also important to seriously consider establishing public innovation platforms or technology innovation alliances for the modern coal chemical industry, and to strengthen the training and development of innovative talents and teams. By fostering innovation, we can drive the high-quality development of the coal chemical industry and achieve new breakthroughs. 　　Third, green development is the foundation for the future of modern coal chemical industry. Against the backdrop of profound adjustments in the global petrochemical industry structure, green development has become the main trend driven by the technological revolution and the optimization and upgrading of industrial structures. Due to its resource-based and energy-intensive nature, the petrochemical industry has one of the highest levels of emissions of waste materials among industrial sectors. The particular characteristics of the coal chemical industry pose even greater challenges in terms of achieving green development. In the field of modern coal chemical industry, issues such as CO2 emissions and water consumption, the efficient treatment of refractory wastewater, the treatment and disposal of highly saline wastewater, and the comprehensive utilization of crystalline salts are all topics of great concern to society. For the high-quality development of the modern coal chemical industry, it is necessary to thoroughly implement the guidelines set out in the \"Guidelines for Promoting the Green Development of the Petrochemical Industry,\" and meet the requirements of the \"Action Plan for the Green Development of the Petrochemical Industry\" as well as its six specific action plans. It is important to strengthen control and management throughout the entire process, reduce the emissions of waste materials, improve the level of recycling these waste materials, and shift from end-of-pipe treatment to comprehensive management in order to enhance the clean and low-carbon development of the industry. Special attention should be paid to the comprehensive utilization of energy, water recycling, CO2 emission reduction, and its capture and application. In particular, through industrial demonstration projects, it is essential to carefully study the integrated development models and their effects in areas such as coal chemistry, electricity generation, and heat production, as well as combined production processes. Research and demonstrations on using CO2 for oil and gas extraction should also be carried out intensively. Where conditions permit, collaboration with universities and research institutions such as those affiliated with the Chinese Academy of Sciences can be pursued to conduct research on using CO2 to produce chemicals. The modern coal chemical industry enhances the level of green development across the sector by deepening the construction of green manufacturing systems, intensifying efforts to foster model enterprises and parks that exemplify green development, and emphasizing control at the source, clean processes, and effective treatment at the end stage. 　　Fourth, product differentiation and high-end positioning are the preferred path for the future of modern coal chemical industry. China’s resource endowment—characterized by a shortage of oil and gas but abundant coal—determines the development potential and prospects for the modern coal chemical industry. Last year, China’s dependence on foreign crude oil reached 70.8%, while its reliance on imported natural gas stood at 43.2%. The structural contradiction in China’s petrochemical industry, namely an oversupply of low-end products and a shortage of high-end ones, remains highly pronounced. Last year, China’s trade deficit in the petrochemical industry amounted to 283.3 billion US dollars, a significant increase of 42.5% on a year-on-year basis; most of the imported petrochemical products were new chemical materials and specialty chemicals. Products related to the modern coal chemical industry include: 2.58 million tons of imported ethylene monomer, 14.025 million tons of imported polyethylene (an increase of 18.9% on a year-on-year basis); 2.84 million tons of imported propylene monomer, and 4.4 million tons of imported polypropylene; 9.54 million tons of imported ethylene glycol, and 15.9 million tons of imported PX. Furthermore, with the large-scale commissioning of petrochemical complexes and integrated refining and chemical processing facilities in China’s coastal areas, the significant issue of heavy reliance on imports for many petrochemical products and a low self-sufficiency rate will see marked improvement. In particular, situations such as an excess supply of refined oil products, bulk basic petrochemical products, and general-purpose synthetic materials will become even more severe. Many enterprises are making efforts to extend their industrial chains and adjust their product structures, focusing on the development of high-end products and specialized materials. Therefore, the future development of the modern coal chemical industry must be market-oriented: it is necessary to achieve coordinated development with large petrochemical complexes in the east, while also pursuing a differentiated development path in terms of product structure compared to integrated refining and chemical production facilities. Modern coal chemical products have different molecular chain structures from petrochemical products, as well as their own unique performance advantages. By focusing on differentiation and high-end development in the process of high-quality growth, they can establish their own market position and competitive advantages. 　　Fifth, clustered development is the future of modern coal chemical industry. Building modern industrial clusters is an important aspect of *the proposal to establish a modern economic system;**** the State Council is currently working on guidelines or implementation plans for fostering world-class industrial clusters based on the existing economic foundation. For the high-quality development of the petrochemical industry, it is essential to focus on fostering a group of world-class enterprises with global competitiveness. These enterprises should strengthen their core competencies by focusing on their main business areas, and improve their modern management skills as well as their ability to operate internationally, thereby becoming key pillars for the high-quality development of the entire industry. At the same time, the high-quality development of the petrochemical industry will also rely on existing petrochemical parks to foster a number of globally competitive petrochemical industry clusters—a successful practice and experience in the economic development of developed countries. Across the country, there are 676 petrochemical parks; among them, 47 generate revenues exceeding 50 billion yuan. In accordance with the newly revised “Plan for the Planning and Layout of the Petrochemical Industry” issued by the State Council, as well as the principles of “scientific planning, rational layout, industrial coordination, efficient management, and clustered development,” China currently has seven major coastal petrochemical bases and four modern coal chemical industry demonstration zones in the western regions—Yulin, Ningdong, Ordos, and Junggar Basin in Xinjiang. Leveraging their respective advantages and adhering to the principle of complementary strengths and differentiated development between the eastern and western regions, these areas focus on developing high-end product chains such as new chemical materials, specialty chemicals, and fine chemicals. The goal is to foster world-class petrochemical industry clusters characterized by strong supporting capabilities, close industrial chain integration, high levels of industrial agglomeration, and hierarchical energy utilization. Efforts are also being made to have these areas designated as **pilot demonstration zones, with the aim of establishing a high-quality development framework that promotes the industrialization, park-based development, intensification, and integration of both the petrochemical and modern coal chemical industries. 　　In the first four months of this year, modern coal chemical industry faced both positive and negative developments; overall, the capacity utilization rate was higher than that of last year. Specifically, it was 95.5% for coal-based olefins (89.0% when including olefins produced from methanol), 84.7% for coal-to-oil conversion, 90.1% for coal-to-gas conversion, and 71.2% for the production of ethylene glycol from coal (syngas). However, due to the increasing pressure of a downturn in the global economy, greater uncertainties in international oil prices, and various internal factors, the performance was not satisfactory. Coal-to-olefins operations were more profitable, while coal-to-oil operations suffered losses owing to tax burdens, and coal-to-gas operations incurred losses as a result of difficulties in connecting to the grid and low connection prices. The biggest change was seen in coal-based ethylene glycol; its price has been falling continuously since last November, and by the end of April it was around 4,500 yuan per ton in the East China market, representing a drop of over 40% compared to the same period last year. Most plants that produce coal-based ethylene glycol are operating at a loss. However, given the current situation, more new projects are expected to be put into operation. It is anticipated that in 2019, the total production capacity for coal-to-oil will remain unchanged; one new coal-to-gas project will be commissioned, along with six new coal-to-olefins projects and eight new coal-to-ethylene glycol projects. The momentum of the rapid development of modern coal chemical industry shows no signs of slowing down. Both the “heat” surrounding the petrochemical industry in the eastern region and that surrounding the coal chemical industry in the western region remain at a high level. Both the short-term and long-term prospects, as well as the present and future of the modern coal chemical industry, deserve our careful consideration!