Xinao coal-to-methanol commercial ops in 2009

10 May 2007 08:58  [Source: ICIS news]

SINGAPORE (ICIS news)--China's Xinao Group, a large private energy company, is expected to start commercial operation at its coal-to-methanol project in 2009, an official with financial backer - the International Finance Corporation (IFC) - said on Thursday.

The 600,000 tonne/year coal-to-methanol plant is based in Erdos, Inner Mongolia, and will feed four separate methanol to dimethyle ether (DME) plants around China, said Nomaan Mirza, an investment officer at the IFC, in a speech at the 10th International Methanol Producers and Consumers Association Asian methanol conference.

The IFC, the private sector arm of the World Bank, arranged a $168m syndicated loan for the project and financing of $10m in equity for the Xinao project.

The Erdos project, including the DME conversion plants in Henan, Hebei, Zhejiang and Shandong provinces cost an estimated $305m to build, added Mirza.

An increase in DME production is based on the methanol derivative as a transportation fuel but increasingly for power generation said Mirza.

"In China, projected demand by 2010 is 25m tonnes a year for power, transportation and residential use," said Mirza.

DME can be used as a cleaner burning substitute for diesel, as well as for household cooking, cleaning and power generation.

This is a long-term strategy for Beijing but in the meantime DME will be used as an blend for liquid petroleum gas, he added.

The influential National Development Regulatory Commission is supporting the development of DME in China as part of a wider policy.

Authorities in Beijing want to move to cleaner burning fuels because of environmental concerns, as well as becoming more energy self-sufficient.

"Awareness among government officials is high and they are taking significant steps to enhance alternative fuels," Mirza said.

By: Matt Kovac
+65 6780 4359

< previous article(VIDEO - ICIS news Asia Lunchtime Bulletin 2 November 2009)

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly