En­ergy project de­liv­ers historic first ship­ment Ningxia coal-to-liq­uids project

Coal-to-liq­uids ven­ture is big­gest of its kind in the world

China Daily (Canada) - - VIEWS - By ZHANG ZHAO and YANG ZIMAN

With an­nual out­put ca­pac­ity of more than 4 mil­lion­metric tons of oil, the largest coalto-liq­uids project inthe world de­liv­ered its first ship­ment of prod­ucts on Wed­nes­day in Yinchuan, the Ningxia Hui au­ton­o­mous re­gion.

The project is the re­sult of 39 months’ con­struc­tion and in­vest­ment of 44 bil­lion yuan ($6.3 bil­lion) and the to­tal in­vest­ment is es­ti­mated at 55 bil­lion yuan, ac­cord­ing to its de­vel­oper, Shen­hua Ningxia Coal In­dus­try Group, a sub­sidiary of en­ergy gi­ant Shen­hua Group Corp.

Although the pro­duc­tiv­ity is small com­pared with China’s na­tion­wide oil de­mand — ex­pected at 610 mil­lion tons a year by 2020 — in­dus­try in­sid­ers said the project was a mile­stone in the na­tion’s en­ergy se­cu­rity ef­forts and the process of eco­nomic re­struc­tur­ing in Ningxia.

“The com­ple­tion of the project is a sub­stan­tive achieve­ment for China in op­ti­miz­ing its strate­gic en­ergy re­serves,” said Shen­hua Chair­man Zhang Yuzhuo.

“It also means that China’s abil­i­ties at equip­ment man­u­fac­tur­ing and in­te­gra­tion have reached a higher level.”

China’s fuel re­sources have fea­tured abun­dant coal but in­ad­e­quate sup­plies of oil and gas, with more than 60 per­cent of its crude needs de­pend­ing on im­ports in 2015.

Zuo Qian­ming, chief coal an­a­lyst with Cinda Se­cu­ri­ties Co, said that coal-to-liq­uids tech­nol­ogy had more sig­nif­i­cance for China’s na­tional en­ergy se­cu­rity than for gen­er­at­ing prof­its.

“If the in­ter­na­tional oil price shoots up, China will have a backup for its oil de­mand,” Zuo said.

The project uses a liq­ue­fac­tion process that in­volves gasi­fi­ca­tion of the coal to a mix­ture of car­bon monox­ide and hy­dro­gen, and then con­verts the syn­gas mix­ture into liq­uid hy­dro­car­bons.

It will con­sume about 20 mil­lion tons of coal an­nu­ally and pro­duce 2.73 mil­lion tons of diesel, nearly 1 mil­lion tons of naph­tha and 340,000 tons of liq­ue­fied petroleum gas.

“Our tech­nolo­gies are lead­ing the world in many ways, en­abling us to build largescale projects,” said Yao Min, deputy gen­eral man­ager of Shen­hua Ningxia. “The do­mes­ti­cally de­vel­oped tech­nolo­gies and equip­ment will help to cut costs and in­crease profit.”

Con­tact the writ­ers at zhangzhao@ chi­nadaily.com.cn and yangz­i­man@chi­nadaily.com.cn

Guo Shaoyu con­trib­uted to this story.

XUE ZHOU / FOR CHINA DAILY

Work­ers help in­stall a crane tower for the coal-to-liq­uids project at Shen­hua Ningxia Coal In­dus­try Group in Yinchuan, the Ningxia Hui au­ton­o­mous re­gion.

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