InterviewLurgi picks up on bio-feedstock trend

26 October 2007 11:03  [Source: ICIS news]

By Florence Tan

 

SINGAPORE (ICIS news)--An increasing focus on alternative feedstocks such as coal and renewable sources in Asia Pacific is opening up business opportunities for German technology firm Lurgi, a company official said on Friday.

 

Rising crude oil costs, a shortage of natural gas and a push for clean energy has led countries such as Indonesia, Australia and Singapore to look for alternatives, Uwe Zwiefelhofer, managing director of Lurgi’s Malaysia office, said in an interview.

 

Indonesia was encouraging its fertilizer industry to look into coal to replace natural gas feedstock, he said, adding that the country has large reserves in Kalimantan and Sumatra.

 

Australia was also trying to establish a coal based industry which will turn synthetic gas into fuels, fertilizers and methanol.

 

Methanol-to-propylene (MTP) was on the drawing board, said Zwiefelhofer who is in-charge of Lurgi’s business in southeast Asia and Australia.

 

“There is serious interest but whether plans are firm, it remains to be seen,” he added.

 

Zwiefelhofer said 75% of the world’s coal-gasification capacity, mainly at Sasol’s coal-to-liquids plant in South Africa, was based on Lurgi’s technology.

 

The company has also licensed its MTP technology to three projects in China and Iran.

 

Two of the proposed units in China were on schedule and it has completed basic engineering at the Iranian project.

 

The project operator was selecting an engineering, procurement and construction contractor and it was difficult to say when it will start up, Zwiefelhofer said.

 

Lurgi continued to be in talks with the Chinese for more projects, he said, adding that a couple of feasibility studies were underway in the Middle East such as Qatar which has abundant gas resources.

 

The company was also developing its biomass-to-liquids (BTL) technology, touted as a second generation biofuel technology, to address some of the challenges, such as high feedstock costs, that the industry was facing.

 

The two-part technology converts biomass into bio-oil via fast pyrolysis, followed by the gasification of the oil into syngas for fuel or methanol production.

 

Lurgi expects the technology to be ready in 2010.

 

Singapore was an ideal place for such a plant, Zwiefelhofer said, adding that a couple of fast-pyrolysis plants could be set up in Malaysia and Indonesia and bio-oil produced could be shipped to Jurong Island in Singapore for the second part of the process.

 

Bogged down by high crude palm oil (CPO) prices, Asia’s relatively young biofuel industry, which started less than three years ago,  was undergoing consolidation as non-integrated projects were slowing down or shelved, Zwiefelhofer said.

 

Unlike the oil and gas industry, biodiesel producers were fully exposed to CPO market fluctuation as none of the vegetable oil producers were willing to enter into long term supply agreement, he added.

 

Most of the development was also moving away from Malaysia to Indonesia where more realistic projects were going ahead, he added.

 

Lurgi, a biofuel technology provider, has a 50% biodiesel market share globally having built 66 plants in the past seven years.

By: Florence Tan
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