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Luan Chemical Group’s Transformation towards High-End Innovation Author/Source: Luan Coal-Based Oil Date: 2021-11-29 Clicks: 24 A year ago, Luan Chemical Group was established. Since its establishment, Lu’an Chemical Group has been continuously working to resolve historical issues and accelerate its transformation and upgrading. Adhering to a problem-oriented approach, it conducts in-depth analyses and implements targeted measures to ensure that key chemical projects such as the 180 Project, Taihua New Materials, and the 160,000-ton coal-to-oil project can minimize losses and improve efficiency. Since the 180 project was brought online on May 9, its maximum load has reached 109%; the results in terms of reducing losses have been significant, and considerable progress has been made in turning the project around. The goal is to achieve profitability for this project during the 14th Five-Year Plan period. Progress has also been made at stages in helping Taihua New Materials and its 160,000-ton coal-to-oil project turn around their losses. Implement a full-industry-chain development initiative to enhance the stability and competitiveness of the industry chain, and build and strengthen it by leveraging advantages in chemical manufacturing. The Jinhua Furnace 2.0 and 3.0 models produced by Lu’an Huaji hold a 70% market share in China’s water-coal slurry gasification technology sector. On June 10, the Jinhua Furnace 3.0 model selected by Xinjiang Tianye Group became the world’s first water-coal slurry gasification furnace to operate for more than 100 days, which holds significant significance in this industry. Building on the Jinhua furnace, future efforts will focus on coordinating the upgrading of the fertilizer industry’s UGI systems, capturing external market opportunities for gasifier renovations, promoting the development and dissemination of gasification technologies suitable for Shanxi’s coal types, and accelerating the research and development of the Jinhua furnace 4.0 version. Lu’an Chemical Machinery will integrate the chemical equipment manufacturing enterprises within the Lu’an Chemical Group to create a leading enterprise in China’s chemical equipment sector, one that offers comprehensive services including research and development, design, manufacturing, installation, operation, maintenance, repair, testing, and support. When the industry prospers, enterprises thrive. This year, Lu’an Chemical Group also established the only chemical industry platform in the province to conduct an in-depth assessment of the fertilizer industry both nationwide and within the province. On April 2, an Integrated Fertilizer Marketing Cooperation Agreement was signed with Syngenta of Sinochem Group ； On June 25, further cooperation intentions were reached with Sinochem Group and Syngenta Group regarding fertilizer marketing partnerships. The new materials sector is an important driver of future development for Lu’an Chemical, as well as a key area for industrial expansion. Over the past year, Lu’an Chemical has seized the policy opportunities and development prospects brought about by the plastic restriction measures as well as the goals of carbon peak and carbon neutrality. Guided by the market and focusing on efficiency, it has steadily advanced its strategic cooperation with Zhejiang Hengyi in order to implement its strategic plans for the fine chemicals and new materials industries. In particular, taking the goal of turning losses into profits by 2018 as a strategic starting point, the company plans to engage in close cooperation with Zhejiang Hengyi. By making full use of Lu’an’s advantages in coal resources and the chemical industry, as well as Zhejiang Hengyi’s strengths in downstream markets, the company aims to establish a world-class base for the production of degradable polyester and polyamide materials within the province. Building on the current layout in Changzhi, and making use of the excess utility facilities from Project 180, the company will construct ethylene glycol and glycolic acid production facilities in phases, with plans to expand into the field of biodegradable polyesters (plastics), thereby establishing a base for green carbon-based new materials in this sector. At present, Lu’an Chemical’s efforts related to the \"dual carbon\" goals are being carried out at full speed. First, determine the “carbon inventory”. Calculate the \"carbon ecosystem account,\" conduct comprehensive investigations and diagnostics to identify which stages in existing industries generate carbon emissions and what the patterns of such emissions are, and carry out accurate measurements of carbon emissions in order to lay a foundation for subsequent carbon governance efforts ； Calculate the “carbon quota accounts” carefully, activate and make full use of the “carbon resources” that can be exchanged or utilized by “Type 4 enterprises”, so as to create conditions for new projects and the development of enterprises. Second, develop a good “carbon plan”. On the one hand, it is necessary to actively understand and implement the policies and target requirements regarding low-carbon development; on the other hand, these efforts should be carried out in a step-by-step manner, taking into account the country’s industrial structure, economic development needs, existing infrastructure, and technological level. Third is to stockpile “carbon technologies”. Technical approaches are the main methods and means for carbon emission reduction and carbon governance. For example, in the coal industry, energy-saving technical measures can be adopted in the production process, as well as efforts can be made to improve the utilization of coal mine gas and to enhance washing and processing processes ； In the chemical industry, technologies such as methane and carbon dioxide reforming represent promising methods for reducing carbon emissions. In the field of clean energy, during the 14th Five-Year Plan period, Lu’an Chemical will focus on keeping an eye on the technological and market developments related to biodegradable materials, polyester raw materials, and bioethanol, building up technical capabilities in these areas. Once the relevant technologies and markets are mature, the company plans to pursue large-scale operations in the bioethanol sector. Since its establishment, Lu’an Chemical Industry Group has strengthened cooperation with renowned research institutions and universities such as Tsinghua University, the Chinese Academy of Sciences, and Taiyuan University of Technology. Together, they have created high-end innovation platforms that integrate industry, academia, research, and application. By leveraging disruptive technologies and breakthroughs in key technologies, the group strives to seize a leading position in the future development of the chemical industry. Following integration and restructuring, Lu’an now has 6 **-level innovation platforms, 12 provincial-level innovation platforms, 12 **-level high-tech enterprises, and 1 industrial technology research institute; it has also consolidated innovation resources to establish a science and technology research institute. Accelerate the process of “differentiated” development. Make full use of the quality characteristics of coal-derived oil products to promote the operation of high-density aviation kerosene and aromatic-free solvent oil projects, as well as the market application of metallocene PAO products, and to achieve import substitution for lubricants used in wind turbines by Taihang Lubricants Company. Accelerate the expansion into downstream value-added chemical and new material industries such as lubricant base oils, solvent oils, specialty fuels, FTO waxes, and specialty chemicals. Increase the export of technology and equipment. As the only domestic manufacturer of phosphoric acid nitrogen fertilizer processes, Tianji has accumulated extensive experience in terms of technology and practice. It has now made substantial breakthroughs in the core patent rights related to phosphoric acid nitrogen fertilizer technologies, and has successfully transferred its process packages to others. The engineering company under Zhengyuan Group, as one of the Class A design institutes under Lu’an, has independently developed China’s leading JR ultra-large-scale ammonia synthesis technology. The equipment for this technology is manufactured by Zhengyuan Tower Equipment Company. To date, more than 400 ammonia synthesis towers have been designed and produced, paving the way for further improvements in large-scale low-pressure ammonia synthesis technology in China. Make every effort to build \"industry giants\". Leveraging the technical expertise accumulated by the Industry Research Institute in the field of polymer additives, it continues to strengthen the technical barriers for three types of products: the engineering modification of polyolefin general-purpose plastics, the enhancement of performance in engineering plastics, and the green modification of bio-based and biodegradable plastics. By doing so, it aims to enhance its market advantages and strive to become a leading enterprise in the plastic additives industry. At the same time, by leveraging its advantages in key raw materials and industrial supporting facilities, it actively expands into the downstream market for biodegradable plastics, aiming to cultivate a group of \"hidden champions\" in new chemical materials.