Sinopec’s \"roadmap\" for coal-to-oil production takes shape

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This post was last edited by jordan569 on 2013-1-6 at 22:37. It has been reported that Sinopec, which has long been interested in coal-to-oil projects, has purchased foreign coal-to-oil technology and equipment from the pilot stage, with the intention of further developing them in order to acquire independent intellectual property rights or core technologies. 　　Sinopec’s roadmap for entering the coal-to-oil sector has also been preliminarily outlined: it will acquire coal resources indirectly by partnering with domestic coal companies, in order to jointly pursue the industrial production of coal-to-oil technology ； At the same time, the joint implementation of coal-to-oil projects with petroleum refining and petrochemical projects may be a direction to explore in the future. 　　Purchase of pilot-scale technology: Syntroleum Corp., based in Tulsa, Oklahoma, USA, announced on February 20 that it has reached a final agreement with Sinopec Corporation to transfer its F-T synthetic oil technology. The transaction was handled by Sinopec’s subsidiary, Sinopec International Corporation. 　　Under this agreement, Sinopec will also build a pilot plant in China based on the company’s Catusa Demonstration Facility (CDF) and related technologies, in order to jointly advance the demonstration, development, and commercialization of this technology. The two parties will share together the benefits resulting from the improvements made to this technology in China. 　　In fact, the Katusa demonstration plant is a facility for producing synthetic oil from natural gas at a daily capacity of 70 barrels; it was built with joint investment from Synthetic Oil Company, the U.S. Department of Energy, and Marathon Petroleum. 　　However, under the agreement, the plants and technologies purchased by Sinopec will be used to produce synthetic oil using coal, petroleum coke, petroleum asphalt, naphtha, and related materials as raw materials. 　　Sinopec will reinstall the demonstration unit and conduct trial operations within the specified time frame, and it must operate for a certain period of time ； American Synthetic Oil Company provides the necessary technical support. The two parties will form a committee to carry out research and development together. 　　The ownership of any technical advancements and improvements achieved belongs to the party that carried out the research and development. American Synthetic Oil Company has the right to allow third parties in China to use the technological advancements achieved by Sinopec, provided that such third parties do not have any significant conflicts of interest with Sinopec in their core business activities. The two parties will share the profits from the technology license in accordance with certain proportions and conditions. 　　Industry experts point out that this agreement potentially rules out the possibility of CNPC and CNOOC acquiring this technology in the future once it becomes more mature. 　　It can also be implemented in conjunction with oil refining projects. Experts from Sinopec’s Research Institute of Petroleum and Petrochemical Technology have confirmed that Sinopec recently acquired, all at once, synthetic oil technology that is already in the pilot stage from an American company. However, the expert emphasized that Sinopec’s goal is to obtain independent intellectual property rights for this technology or to master its core technologies, so as to reduce technical costs in the future through methods such as cross-licensing of intellectual property. 　　The source revealed that Sinopec has developed plans for coal-to-oil production, and may adopt a different technological approach compared to other domestic coal-to-oil companies in the future. 　　Recently, Academician Chen Junwu from Luoyang Petrochemical Company of Sinopec Group wrote in the journal \"Coal Chemistry\" that the development direction of the coal liquefaction industry lies in the combined implementation of coal-to-oil projects with oil refining and petrochemical projects, in order to achieve complementary raw materials, optimized product mixtures, and shared utility systems. It is also possible to combine the deep processing of refinery residues through coal-to-hydrogen technology with direct coal liquefaction for oil production. 　　Industry experts point out that for the plants and technologies purchased by Sinopec this time, the raw materials include not only coal but also petroleum coke, petroleum asphalt, naphtha, and other refining products; it is likely that they are moving in the direction of such \"joint implementation\". 　　Sinopec has been working in partnership with coal companies. 　　During ** this year, Sinopec signed an agreement with ** in Henan Province to collaborate with the local largest coal enterprise, Henan Coal and Chemical Industry Group, on building a coal-to-olefins project. Henan Coal and Chemical Industry Group also plans to start construction on a coal-to-oil project with an annual capacity of 3 million tons by the end of 2010. 　　Sinopec also has a very close relationship with Shenhua Group; it not only may sell the refined products produced by Shenhua’s coal-to-oil plants but is also involved in the refining of the synthetic oils generated by those plants. Su Shulin, chairman of Sinopec, has expressed a desire to form a strategic partnership with Shenhua to jointly develop oil alternatives. (Source: China Securities Journal). Note $ #, $ $