Development of China’s ‘coal-to-oil’ process technology

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However, sources familiar with the matter say that the development of \"coal-to-oil\" technology in China is not going smoothly, and upon closer analysis, there are mainly two issues at play. Firstly, coal-to-oil technology has stringent requirements and high investment costs. Coal-to-oil conversion is divided into two main categories: \"indirect liquefaction\" and \"direct liquefaction\". “The capital investment for the \"indirect liquefaction method\" per ton of oil is over 10,000 yuan, and its operating costs are also high, which to some extent limits its widespread adoption. “The “direct liquefaction method” has not yet been put into industrial use on an international scale; the key issue is that its operational conditions are extremely stringent, equipment manufacturing is difficult, the risks associated with operation are high, and the investment required is also substantial (with infrastructure costs exceeding 8,000 yuan per ton of oil produced). Secondly, the coal used as raw material for coal-to-oil production is also utilized in steelmaking, coke production, gas generation, metallurgy, and combustion, which results in high prices and a shortage of this raw material. How can we reduce the requirements for raw materials, allowing the use of lower-quality coal, while simultaneously simplifying the production process and cutting down investment costs, in order to produce gasoline and diesel that meet international and domestic standards? Over the past twenty-odd years, numerous investment firms have tried to enter this field characterized by high technical complexity and substantial investment costs, but most of them have failed. Those who are able to hold on through hardship are truly rare. Zhaoqing Shunxin Coal Chemical Technology Co., Ltd. is one of the few remaining private high-tech enterprises that remain committed to this industry. Wu Ke, the company’s chairman, said that after nearly a decade of hard work, they managed to bring together a group of experienced researchers from the fields of coal chemistry and petrochemicals to work together on this project, resulting in the development of a \"thermolytic catalytic process for converting coal into oil\" with independent intellectual property rights. In 2003, the Ministry of Science and Technology included this project in the **Key Promotion Plan for Scientific and Technological Achievements**. In November 2005, the Guangdong Provincial Department of Science and Technology held an appraisal meeting in Zhuhai; an appraisal committee composed of several top experts in the fields of petrochemicals, refining, and coal-to-oil conversion assessed the thermolytic catalytic process as having \"mild process conditions, safe operation, low investment requirements, and easy equipment fabrication\". According to Professor Wu Chunlai, former director of the Beijing Coal Chemical Engineering Branch of the former China Coal Research Institute and who was involved in the evaluation, for the direct liquefaction of coal, the commonly used method internationally is high-pressure hydrogenation, which involves injecting hydrogen at a temperature of 450°C and under pressures of 170–200 atmospheres to liquefy coal. However, this method involves harsh processing conditions, high investment costs, and stringent requirements for equipment manufacturing (especially as moving equipment has to be imported), and its safe and stable operation is also questioned. The direct liquefaction method under mild conditions (i.e., the thermal catalytic method) requires only a temperature of 400°C and a pressure of 60 kilograms, and no gaseous hydrogen is needed to liquefy coal; as a result, investment is reduced, all equipment can be manufactured domestically, and its operation is stable and reliable. Wu Chunlai specifically pointed out that the raw material used in the thermolytic catalysis method is lignite, a low-calorific-value coal with high moisture, ash, and sulfur content; it is of poor quality. China has enormous reserves of this coal – over 120 billion tons have been identified to date. Using lignite as a raw material is nothing short of turning waste into treasure. Furthermore, we employ an integrated process throughout the conversion process, combining oil production and gas production to truly make the most of lignite, achieving efficient conversion and utilization while being environmentally friendly.