Shenhua, Dow project to produce 1m mt/yr olefins

24 July 2006 09:28  [Source: ICIS news]

Another CTO projectSINGAPORE (ICIS news)--A proposed coal-to-olefins (CTO) joint venture project between the Shenhua Group and Dow Chemical could produce 1m tonnes/year of olefins, a source close to the project said on Monday.

The coal-based project at Yulin, Shaanxi province, will also produce 3m tonnes/year of methanol as feedstock for olefins production, he added.

Both companies are still working on the details of the joint venture and they have yet to seek government approval, he said. However, the project is unlikely to be affected by the recent government clampdown on CTO projects as its capacities meet the official requirement, he added.

In an effort to cool coal chemical investments, China’s National Development and Reform Commission said in mid-July that coal-to-liquids (CTL) projects should have a minimum capacity of 3m tonnes/year. The capacities for methanol and dimethyl ether (DME) plants should be at least 1m tonnes/year and that for a coal-to-olefins (CTO) unit should be 600,000 tonnes/year or more.

The Shenhua Group, a Chinese coal major, and Dow Chemical agreed to evaluate the feasibility of coal-to-olefins projects in China in late 2004. A decision could be made by the end of this year.

By: Florence Tan
+65 6780 4359

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