Thread Content
It was learned from relevant departments in Ordos recently that there are currently 6 methanol production projects in that region with a capacity of over one million tons each. As some of these projects come online this year, Ordos will become the largest methanol production base in the country. By 2010, the methanol production capacity in this region will exceed 10 million tons. These six methanol projects with production capacities of over 1 million tons each are as follows: a 1-million-ton methanol project invested by Ordos Rongcheng Energy Chemical Company; a 1-million-ton methanol project jointly funded by Guangdong Xiangjiang Group and Ordos Huayan Group; a 1.2-million-ton coal-to-methanol project invested by Wushenqi Shilin Chemical Co., Ltd.; a 1-million-ton methanol project invested by Inner Mongolia Boyuan United Chemical Co., Ltd.; a 1.2-million-ton coal-to-methanol project invested by Inner Mongolia Ximeng Group; and a 4.2-million-ton per year methanol production project, which is part of a 3-million-ton dimethyl ether project funded by five companies namely China National Coal Energy Group Corporation, Sinopec Corporation, Shenneng Group Co., Ltd., China Yintai Investment Co., Ltd., and Inner Mongolia Manshi Coal Group Co., Ltd. Among the aforementioned six methanol projects with capacities of one million tons each, Inner Mongolia Boyuan Lianhua’s 1-million-ton methanol project is expected to come online gradually by the end of this year. Shilin’s 1.2-million-ton coal-based methanol project is scheduled to start operations in May 2008, with further phases of this project coming online by 2010. Industry experts say it was inevitable that in 2007, Ordos would become the largest methanol production base in the country. The reporter learned that China’s largest methanol production facility at present – the 600,000-ton-per-year methanol plant operated by CNOOC Jiantao Chemical Co., Ltd. – began operations officially on September 12 last year. Regarding why so many methanol projects with capacities of millions of tons have been established in Ordos, a market analyst told reporters that the main reason is Ordos’ resource advantages. Here is the natural gas and coal required to produce methanol. According to relevant data, there are as many as 33 different types of minerals in Ordos that can be exploited for industrial use. The proven coal reserves amount to 149.6 billion tons, accounting for about 1/6 of the total national reserves and 1/2 of the reserves in the Inner Mongolia Autonomous Region. If calculated down to 1,500 meters underground, the total reserve is about 1 trillion tons. The analyst also said that another important reason for the launch of numerous methanol projects in the country in recent years is the rise in international oil prices, which has created a large market opportunity for the development of clean energy sources such as methanol. Last July, the **National Development and Reform Commission stated that it would generally no longer approve methanol projects with an annual production capacity of less than 1 million tons. Additionally, factors such as the tight supply of natural gas in China, which limits the operational rate of methanol plants, rising costs, and the suspension of several methanol production facilities abroad have contributed to a steady rise in domestic methanol prices; the current price is around 3,000 yuan per ton. The production cost per ton of methanol is between 800 and 1,000 yuan; if coal is used as the raw material, 2.25–2.5 tons of coal are required to produce 1.5–1.6 tons of methanol ； If natural gas is used, 1,500–1,600 cubic meters of natural gas can produce 1.5–1.6 tons of methanol. In terms of return on investment, the profit margin for methanol projects can reach around 30%-40%. Although there are many methanol projects in the country, the profit margins for such projects have remained relatively high in recent years. Li Hongjun, deputy director of a professional committee at the China Nitrogen Fertilizer Industry Association, revealed at a forum that in 2005, 28 new methanol production facilities were put into operation as planned, with a total capacity of 4 million tons ； In 2006, 26 enterprises began operations on schedule, with a total production capacity of 4.44 million tons ； Throughout the 11th Five-Year Plan period, there were 88 methanol projects under construction or in the planning stage, with a total production capacity of 48.5 million tons. Experts analyze that in 2008, the supply of methanol in China’s market is expected to become excessive. However, methanol consumption in our country remains confined to traditional sectors at present. The use of methanol as a fuel has not yet been finalized, nor are there any unified **standards** in place. Based on the current domestic consumption of gasoline, if methanol is blended into gasoline at the M15 standard, as much as 50 million tons of methanol would be required each year. Source: Inner Mongolia Autonomous Region Information Center