How can coal-based olefins overcome environmental and cost constraints?

Thread Content

How can coal-based olefins overcome environmental and cost constraints? Author/Source: China Chemical Industry News Date: 2016-04-12 Clicks: 31 During the 12th Five-Year Plan period, the development of modern coal chemical industry led to a significant growth in coal-based olefins production; the annual capacity for such production was around 8 million tons, accounting for 17.2% of the total olefin production capacity. “However, in the current environment of low oil prices, it is becoming increasingly difficult for coal-based olefin manufacturers to survive. To overcome the dual challenges posed by environmental regulations and high costs, they must rely on technological breakthroughs. ”At the 2016 China (International) Olefins Conference hosted by the Chinese Chemical Society at the end of March, how to overcome development challenges through innovative technologies became a hot topic in discussions on coal-based olefins production processes. The development of coal-based olefins should be moderate. China’s energy profile, characterized by abundant coal and limited oil reserves, the policy focus on using lighter feedstocks for olefin production, the supply-demand imbalance in the olefin market, and the high profits associated with this industry, all contributed to the creation of a large number of new coal-based olefin production facilities during the 12th Five-Year Plan period. According to statistics, by the end of 2015, China had a total of 19 coal/methanol-based olefin production units, with a combined capacity of 7.7 million tons. However, the surge in new olefin production capacity has not only led to changes in the domestic supply landscape; under low oil prices, its negative effects have also become apparent, pushing companies that produce olefins from coal/methanol into difficult situations. Especially for olefin companies that rely on imported raw materials, the surge in cost pressures has made heavy losses the norm. Whether to proceed with coal-based olefin projects in the future has become a topic of concern in the industry. “Coal-to-olefins projects should be developed in a moderate manner. ”This is a view widely agreed upon by the experts present. On the one hand, China is relatively rich in coal resources; developing coal-based olefins can diversify the sources of olefin raw materials and reduce dependence on crude oil imports. On the other hand, international crude oil prices will not remain between $30 and $40 for long. According to the International Energy Agency’s projections, international oil prices will rebound to $80 in 2020, while OPEC expects prices to range between $60 and $80. Bai Yi, deputy director of the Petroleum and Chemical Industry Planning Institute, said in his speech that the crude oil price that coal-based olefin projects can tolerate, according to their calculations, is 70 dollars per barrel, while methanol-based olefin projects can withstand a crude oil price of 60 dollars per barrel. It is based on such predictions that the conclusion is drawn that coal-based olefins can still develop to a moderate extent. Double constraints from environmental costs: The production cost of coal-based olefin processes is high, resulting in poor profitability for such facilities; it is even more difficult to survive under the current circumstances. According to Wang Yuqing, a member of the Petrochemical Subcommittee of the Chinese Chemical Society, despite the significant drop in coal prices over the past year, the cost of coal-based olefins remains significantly higher than that of traditional steam cracking and propane dehydrogenation processes. Based on oil and coal prices in January of this year, the costs of various olefin production processes are as follows: steam cracking < propane dehydrogenation < coal-to-olefins. Market data also shows that in the second half of 2015, the methanol-to-propylene (MTP) process incurred an average loss of 760 yuan per ton; as a result, all MTP plants were shut down, which undoubtedly dealt a severe blow to other companies that were either building or planning to build such facilities. At the same time, compared with traditional steam cracking and propane dehydrogenation processes, high water consumption, low effective carbon conversion rate, high CO2 emissions, and difficult wastewater treatment are also the weaknesses of the coal-to-olefins process in terms of environmental protection. Furthermore, there is relatively limited experience in the long-term operation of coal-to-olefins plants; in particular, large-scale gasifiers and air separation units remain weak points that require experience to be accumulated through operation. Therefore, Wang Yuqing believes that the development of the coal-based olefins industry should first focus on making use of coal resources and water resources ； Special attention is paid to energy conservation, emission reduction, water conservation, and other aspects in order to meet the stricter environmental regulations of the future. Bai Yi also emphasized that, given that the foundation of the modern coal chemical industry has not yet been fully optimized and matured, the large-scale construction of coal-based olefin plants places significant pressure on regional water resources balance and environmental protection. Given that the stability of methanol supply and cost control risks in the domestic market cannot be fully assured, projects that use purchased methanol to produce olefins are also subject to raw material supply and investment risks. Therefore, the development of olefin production capacity through new feedstock routes such as coal/methanol-to-olefins must be approached in a rational and objective manner. Leverage innovation to overcome bottlenecks: “Breaking through environmental and cost barriers relies on technological innovation.” ”This is the consensus reached by the experts present. The Dalian Institute of Chemical Physics, affiliated with the Chinese Academy of Sciences, is a leader in coal-to-olefins technology in China. The MTO/MTP technology developed by this institute has been deployed in 9 production units, resulting in a total olefins production capacity of 5.2 million tons. According to Academician Liu Zhongmin, the deputy director of the institute, under low oil prices, the profitability of these coal-based olefin projects varies, but one thing in common is that plants that employ new technologies generally achieve better profits. For example, the coal-to-olefins project of Ningxia Baofeng Group, which partially utilizes coke oven gas to produce methanol, achieved a net profit of 620 million yuan in the first half of last year, demonstrating good economic efficiency. Bai Yi also emphasized that for the newly launched coal-based olefin projects, it is essential to thoroughly optimize the technology of the plants in order to ensure their profitability. Given the current low oil prices, Academician Liu Zhongmin suggests that coal chemical enterprises should pay more attention to the development of new technologies, such as the recently advanced processes of producing olefins from methane and syngas. These two new processes are seen as holding great promise for reducing the production costs of olefins derived from coal and addressing environmental concerns. The methane-to-olefins process is a new catalytic process developed by Academician Bao Xinhe’s team; it enables the efficient conversion of methane into olefins, aromatics, and hydrogen under anaerobic conditions, offering greater economic efficiency and being more environmentally friendly compared to traditional methods. In March this year, the Dalian Institute of Chemical Physics, Saudi Basic Industries Corporation, and China National Petroleum Corporation are working together through a tripartite partnership to accelerate the transition of this technology from the laboratory stage to industrial application. Also in March of this year, the syngas-to-olefins process was successfully developed. This process eliminates the water-gas shift hydrogen production method, which is characterized by high water and energy consumption, and instead makes use of the syngas produced by gasification. Under the action of a novel composite catalyst, low-carbon olefins are obtained through a highly selective one-step reaction. The significance of this breakthrough is self-evident for China, which relies on imports for over 60% of its oil needs, has an energy structure dominated by coal, and is facing an increasing shortage of water resources. A new coal conversion pathway with low water consumption has been developed without altering the total CO2 emissions. Also in March of this year, the highly anticipated project by China Coal Tuoke for the treatment of coal chemical wastewater and the achievement of zero emissions passed the expert evaluation conducted by the China Coal Industry Association. Experts believe that the technical approach for a zero-discharge system for coal chemical wastewater developed in this project is reasonable, enabling waste water reduction and resource utilization, with a wastewater reuse rate of 98%. This achievement holds significance as a model and example for the development of coal chemical industries in areas with water scarcity. Experts say that with such a pace of technological research and development, there is no reason to worry that the future of coal-based olefin production will not be bright.