Some thoughts on coal-to-natural gas
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In my opinion, the biggest constraint on the development of coal-to-natural gas production is still the price of coal; more than 60% of the cost of coal-to-natural gas is accounted for by the price of coal. Using the price of coal at the mine site to assess the economic viability of coal-to-natural gas production may not be sufficient. On the other hand, for product transportation, it is not easy to connect to the long-distance pipeline networks of the three major companies. If one decides to invest in building its own pipelines, it has to deal with a range of issues such as land acquisition, investment costs, operation and management, as well as safety concerns. Finally, the water consumption and environmental impact associated with coal-to-natural gas production are also key factors limiting its development. Of course, at present, local authorities **are eager for large-scale projects like coal-to-natural gas, which involve investments in the tens of billions, in order to boost GDP; they do not give much consideration to environmental impacts. Moreover, the current projects are located in remote areas such as Xinjiang and Inner Mongolia, where there is less emphasis on environmental protection. However, in the long term, there is a clear upward trend in natural gas prices, especially after the completion of the Second West-East Gas Pipeline, so coal-to-natural gas should have some room for development.
This post was last edited by huchsh on 2010-1-7 08:43. Well, it does have a promising future; otherwise, that amount of coal would have run out long ago.
This post was last edited by huchsh on 2010-1-7 08:44. The technology for producing natural gas from coal is mature; the constraints are economic factors, namely coal prices and natural gas prices.
Low-quality lignite can still be useful in producing clean energy gas; it’s just that technical expertise needs to be further developed and improved!
This post was last edited by huchsh on 2010-1-7 08:45. 1. I completely agree; coal costs account for 50-70% of the total costs in almost all coal chemical projects； 2. Domestic natural gas prices have inverted, leading to a gas shortage in winter; prices need to be adjusted and should be around 3-4 yuan ； 3. **There is a severe shortage of natural gas; 2 coal-to-gas projects were approved at the end of last year, and I feel it’s almost here. .
With improved technology, the conversion rate increases, which is beneficial for transportation; it seems to have a promising future
1. Resources: For coal-based natural gas production, it is best to have one’s own coal resources. The two companies that have received approval are large coal producers; it is therefore very difficult for companies that lack such resources yet still want to get involved in this industry. 2. Technology: There are no technical issues with coal-to-natural gas production, and many of the equipment and technologies used in this process are now domestically produced. 3. Market: The market situation is currently highly uncertain; an expert at the Ordos Coal-to-Natural Gas/Shale Gas Forum even predicted that China would experience a surplus of natural gas by 2015. However, in my opinion, this view cannot be determined based on the current situation. 4. Policies **The policies regarding coal-to-natural gas are not clear enough; it is only stated that, in principle, no demonstration projects for modern coal chemical industries will be approved for the next 3 years
I support it; I think liquefied natural gas should be made available in rural areas of our country, as this is a sustainable approach for conserving resources and protecting the environment. I strongly support the use of coal to produce natural gas!
I completely agree with the original poster’s view; the coal price at the mining sites is indeed low. It seems that natural gas from SNG has a price advantage, but in reality, the pipeline networks are entirely under the control of CNPC and Sinopec. If you want to connect to these networks, you have to pay a fee to do so, right?
**One should still be cautious – is it worth investing so much effort in converting one primary energy source into another? Environmental damage, pipeline construction – there are many uncertainties.
This post was last edited by shanxg on 2010-1-8 at 09:41. I’m not sure how the price of 3-4 yuan was determined; the cost of coal-to-natural gas production should be calculated based on the cost of coal at the mining sites, investment costs, and transportation costs in different regions. So far, no price higher than 2 yuan has been reported. If the final selling price reaches 4 yuan, then it would be quite economical. Currently, the price of natural gas for domestic use is around 2 to 2.5 yuan per cubic meter, while it’s slightly more expensive for industrial use. It’s not clear whether both categories will see price adjustments, or whether a tiered pricing system will be adopted, similar to that used for electricity prices. If the price for domestic use were indeed raised to 4 yuan or higher, people would not be happy about that. Furthermore, according to the current development plans for coal-to-natural gas production, the output is expected to reach 20 billion cubic meters by 2015; this represents a relatively small proportion of total consumption, around 10%. To raise prices overall just because of such a small proportion of natural gas produced is indeed a form of helping the rich at the expense of the poor. Moreover, with natural gas prices so low in Southeast Asia at the moment, if our market is opened up, it’s unclear where the competitiveness will lie So what’s crucial now is still how to improve the competitiveness of coal-to-natural gas itself, by reducing investment and operating costs.