The “disruptive” coal chemical technology developed by Shenwu Environmental Protection remains to be tested on a demonstrative scale

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Recently, I was following the technology developed by one company, when I was suddenly shocked by the following news: The “revolutionary” coal chemical processing technologies developed by Shenwu Environmental Protection are under scrutiny. Author: | Source: **Coal Chemical Industry Network | Date: 2016-08-30. The “new acetylene-based coal chemical processing process” and the “new methaneation process without recycling” have been described by Shenwu Group as being “revolutionary” in terms of coal chemical technology. This technology has also been frequently mentioned in the newspapers, and it has even been regarded by several regions as a key technology project for attracting investment. Recently, relying on this technology, Shenwu Group has signed a number of strategic cooperation agreements with Daqing City ** and Wuhai City **, with investment amounts exceeding 10 billion yuan. According to one source, Shenwu Group’s \"new methaneation process without recycling\" is currently being used in the Inner Mongolia Port project with an annual production capacity of 100 million cubic meters of LNG, the Wuhai project in Inner Mongolia with an annual output of 300 million cubic meters of SNG, and the Shengwo project in Xinjiang with an annual production capacity of 400 million cubic meters of SNG. Several senior executives at Shenwu Group told reporters from China Business News that, after the original project for Inner Mongolia Port was finalized, it not only led to a significant reduction in the production costs of calcium carbide but also generated considerable benefits in terms of energy conservation and emission reduction. This marks the emergence of a new market for calcium carbide and serves as a model for similar initiatives. But at the moment, what is the current operating status of the project undertaken by Inner Mongolia Gangyuan Chemical Co., Ltd. (hereinafter referred to as “Gangyuan Chemical”) to upgrade its 6×33,000 KVA calcium carbide furnaces in order to produce 100 million cubic meters of LNG per year? How much more cost was saved after adopting Shenwu Group’s related technologies? How does Gangyuan Chemical evaluate the relevant technologies of Shenwu Group? With these questions in mind, the reporter visited the former Shenwu Inner Mongolia Port project as well as the related Shenwu Wuhai projects in mid-August 2016. The demonstrative nature of the Gangyuan calcium carbide technological upgrade project is under review. Shenwu Environmental Protection, a listed company under the Shenwu Group, announced on October 8, 2015, that its wholly-owned subsidiaries Beijing Huafu Shenwu Industrial Furnace Co., Ltd. and Shenwu Environmental Protection Technology Xinjiang Co., Ltd. had signed respectively the \"PC General Contract for the Technical Upgrade of Gangyuan Chemical Industry Co., Ltd.’s 6×33,000 KVA Calcium Carbide Furnaces to Produce 100 million Nm3 of LNG per year\" (hereinafter referred to as \"Contract 1\") and the \"PC Contract for the Technical Upgrade of Gangyuan Chemical Industry Co., Ltd.’s 6×33,000 KVA Calcium Carbide Furnaces to Produce 100 million Nm3 of LNG per year\" (hereinafter referred to as \"Contract 2\") with Gangyuan Chemical Industry Co., Ltd.; the total value of these contracts is approximately 550 million yuan. Among them, the scope of work under Contract 1 includes the procurement of equipment and materials, as well as the construction work related to the overall plant layout and transportation systems, external pipelines, water supply and drainage systems, fire protection facilities, power supply systems, telecommunications infrastructure, enclosure gates, and the calcium carbide production units (excluding the renovation of the calcium carbide furnaces themselves); it also covers public utility systems (excluding gas stations). The scope of Work 2 under the contract includes the renovation project for the 6×33,000 KVA calcium carbide furnaces at Inner Mongolia Port Yuanhua Chemical Co., Ltd., aimed at increasing annual LNG production to 100 million Nm3. This involves the procurement and installation of the renovation works for the main equipment of the four enclosed calcium carbide furnaces (1#, 2#, 5#, 6#), as well as their electrical systems and instrument automation control systems ； Renovation of gas purification equipment, electrical systems, and instrument automation control systems for 4 calcium carbide furnaces ； Renovation of the dust removal equipment, electrical systems, and instrument automation control systems for 4 calcium carbide furnaces. The demolition of old equipment, electrical systems, and instrument automation systems within the specified range, as well as the procurement and installation of new equipment, electrical systems, and instrument automation systems. After the successful signing of this contract, it was repeatedly mentioned by Shenwu Group in various public occasions, with the group stating that it would promote the use of these related technologies on a wide scale. Wu Daohong, chairman of Shenwu Group, also said publicly that \"the Gangyuan project was officially completed and put into operation at the end of February this year; the equipment is operating stably, and all energy-saving indicators meet the expected standards.\" ” So, after the Gangyuan project adopted the relevant technologies from Shenwu Group, is the equipment operation stable? How much cost was actually saved for Hongyuan Chemical? How much profit was generated? In mid-August 2016, the reporter went to the Hangningdalaie Industrial Park in Chayouhouqi County, Ulanqab City, Inner Mongolia, where Gangyuan Chemical is located, for an on-site investigation. It was found that the port-based chemical plant area is under construction. Regarding the infrastructure aspects, the construction workers at the factory site told reporters that this is Phase 3 of the Gangyuan project. However, as Shenwu Group previously told reporters, the 420,000-ton calcium carbide project at Inner Mongolia Port Yuanhua Chemical has been put into operation, enabling commercial production with all technical indicators meeting the expected standards. So what exactly is Phase 3 of Hongyuan, as referred to by the staff at the Hong Kong dollar manufacturing site? Subsequently, the reporter went to the registration desk at the Kōhara Chemical Plant area, showed the relevant identification to the security staff, and explained the purpose of the interview. Subsequently, Wang Kangzhu, the person in charge at Gangyuan Chemical, said that in order to understand how Shenwu Group’s relevant technologies are applied at Gangyuan Chemical, the company can only agree to interviews after obtaining permission from Shenwu Group. As for the operational status of Hongyuan Chemicals and related project upgrades, Hongyuan Chemicals refuses to give interviews. Subsequently, the reporter contacted Shenwu Group. Ms. Huang, the person in charge of handling such inquiries, stated that regarding interviews related to the application of the original chemical processing technologies at Shenwu Port, the reporter needed to fill in details such as the reporter’s ID number, identity card number, and the content of the interview, in accordance with Shenwu Group’s regulations; only after approval could the request be processed. The reporter complied with Shenwu Group’s aforementioned requirements. Regrettably, two days later, Ms. Huang from Shenwu Group told the reporter that the request for an interview submitted by the reporter from China Business News was rejected by the leadership of Shenwu Group, without any explanation given for why. The approval procedures for the relevant projects have deficiencies; consequently, permission was not obtained from Shenwu Group nor from Gangyuan Chemical to visit the facility in person and see the results of Shenwu Group’s technological applications. However, through information provided by sources and relevant data supplied by the department, the reporter was able to gain an indirect understanding of Hongyuan Chemical’s current operating conditions. Regarding the “Phase 3 project” of Gangyuan Chemical that the journalists saw at the Gangyuan Chemical plant area in Hong Kong. A source who wished to remain anonymous told reporters that the project is actually a renovation project for two of the Hongyuan 6×33,000 KVA calcium carbide furnaces. The source also said that Gangyuan Chemical is an enterprise attracted to Chayouhouqi for investment; it was established in June 2003 and came online for operation in December of the same year. In 2013, it moved entirely to the Hanningdalai Industrial Park in Chayouhouqi. Its registered capital is 150 million yuan, and it covers an area of 550 mu. At present, Gangyuan Chemical has a total of 6 calcium carbide furnaces with a capacity of 33,000 KVA each. Two of these conventional furnaces have an annual production capacity of around 120,000 to 140,000 tons; two furnaces that have undergone technical upgrades (using Shenwu’s related technologies) have an annual production capacity of around 160,000 tons. The remaining two furnaces are part of ongoing projects, namely the \"Phase 3 project\" that was seen by the reporter at the Gangyuan Chemical plant. The information provided by the aforementioned source was also corroborated by the management committee of the Building Materials and Chemical Industry Park in Chayouhouqi. Kohgen Chemical has completed the technical upgrades of two calcium carbide furnaces and two conventional furnaces; the remaining two are under construction. In other words, the relevant technologies of Shenwu Group are currently only applied to two calcium carbide furnaces that have undergone technical upgrades, with an annual production capacity of 160,000 tons for these two furnaces combined. It is clearly a long way off from what Shenwu Group previously said, namely that Hongyuan Chemical’s 420,000-ton calcium carbide project would go into official operation and start commercial production. In addition, Shenwu Group has claimed that its related technologies have been applied to the Inner Mongolia Port project with an annual production capacity of 100 million cubic meters of LNG, as well as the Wuhai project in Inner Mongolia with an annual production capacity of 300 million cubic meters of SNG. In response to this, our newspaper’s reporters conducted on-site investigations and learned that Inner Mongolia Port’s original 100 million cubic meter LNG project is located 500 meters east of the Portyuan Company; it is currently in the infrastructure construction phase and has not yet been put into operation. In other words, the new processes related to Shenwu Group have not yet been used. On the other hand, in June 2010, a **Notice on Matters Concerning the Regulation of the Development of Coal-to-Gas Industries** was issued, bringing the approval authority for coal-to-gas projects back to the **level. In March 2011, the **National Development and Reform Commission once again explicitly prohibited the construction of coal-to-gas projects with an annual production capacity of less than 2 billion cubic meters. So, has the Shenwu Group obtained the necessary approvals for its LNG project at the Inner Mongolia Port Yuanhua Chemical Plant, which involves 100 million cubic meters of LNG produced from coal? In response to this, Shenwu Group has previously stated clearly that the aforementioned project has completed all necessary approval procedures and complies with **relevant regulations. However, our newspaper’s reporter failed to obtain any approval documents for Hongyuan Chemical’s 100-million-cubic-meter LNG project from the Development and Reform Commission in Ulanqab City, Inner Mongolia. Subsequently, based on information provided by sources, it was found that the project allegedly attempted to reuse the approval procedures from Hongyuan’s original 6×33,000 KVA calcium carbide furnace renovation project, which posed obvious flaws. Subsequently, the reporter learned from the relevant **departments in Ulanqab City that, at the beginning of 2016, the aforementioned project received approval for its environmental impact assessment report from Chayouhou Banner; as for the other approval procedures, those used were the same as those applied for the technical renovation of the calcium carbide furnace in Gangyuan in 2011. However, according to on-site investigations by reporters, although the 100 million cubic meter LNG project of Gangyuan Chemical utilizes the technology from a calcium carbide furnace renovation project, it is not located within the Gangyuan Chemical plant area; rather, it is situated on an open plot of land about 500 meters east of the plant. In other words, this project is entirely a new construction. It is also because the approval procedures were applied to the 100 million cubic meter LNG project that, to date, the 286 mu of land used for this project has not yet obtained the necessary permits. As for Shenwu Group’s claimed project to produce 300 million cubic meters of SNG annually in Wuhai, Mongolia, the reporter visited the Low-Carbon Industrial Park in the Wuhai Economic and Technological Development Zone and found no evidence that the project was already in operation or under construction. Nor were any relevant approval documents for this project found in the Ulaanbaatar Development and Reform Commission and other **relevant authorities. Additionally, according to a source at Gangyuan Chemical, Shenwu Group had previously stated on multiple occasions that it intended to build a calcium carbide production facility with an annual capacity of 500,000 tons in the Building Materials and Chemicals Park in Chayouhouqi, planning to locate it east of the park’s railway line on a site covering over a thousand mu. However, during the technical upgrades to Gangyuan Company’s second-generation calcium carbide furnaces, certain technical issues persisted, and the expected energy-saving results were not achieved; this has raised doubts regarding Shenwu Group’s plan to build its own 500,000-ton/year calcium carbide facility. Regarding the above-mentioned issues, our newspaper sent a letter to Shenwu Group; Shenwu Group confirmed that it had received the letter. However, one week has passed yet no response from Shenwu Group has been received. On August 25, 2016, a reporter from this newspaper called several senior executives at Shenwu Group again, but as of the time of publication, Shenwu Group had not provided any explanations regarding the aforementioned questions. (Source: China Business News)