By Malini Hariharan
The first of China's major coal-based chemical projects has finally started trial operations.
ICIS news reports that methanol has been fed at Shenhua Baotou's 600,000 tonnes/year methanol-to-olefins (MTO) plant at Baotou, in inner Mongolia. The unit can produce 300,000 tonnes/year each of ethylene and propylene. But the downstream polyethylene (PE) and polypropylene (PP) units have to start and the company is said to have set a September target for achieving on-spec PE and PP production.
Pic Source: National Research Center for Coal and Energy
The Shenhua Baotou unit is said to be the first large-scale demonstration plant for the MTO technology that has been developed by the Dalian Institute of Chemistry and Physics.
There are two more projects that are likely to start later this year - Datang Power's 450,000 tonnes/year methanol-to-propylene (MTP) and PP project and Shenhua Ningxia's 500,000 tonnes/year MTP/PP project.
Successful operations at these plants is likely to trigger a fresh wave of coal-to-chemical projects.
Consultants AsiaChem expect 2010 to be a critical year for the development of China's coal-based chemicals industry.
The three MTO/MTP projects are likely to be finally completed and evaluation of coal-to-liquids (CTL) plants that started last year would be possible.
Additionally, a demonstration plant for the new coal to monoethylene glycol (MEG) technology is also likely to be completed this year. The plant, which is being built by Tongliao GEM Chemical, will produce 150,000 tonnes/year of MEG and also 100,000 tonnes/year of oxalic acid.
And Anhui Huaihua Group is cooperating with Shanghai Pujing Chemical Technology to build a 1000 tonnes/year syngas-to-MEG demonstration plant. The unit is likely to enter testing stage in September this year and preparation for a scaled-up plant is expected to be complete before the year end.
The consultancy estimates that China has nearly 20 other coal-based MEG projects at the preliminary planning stage.
Nexant Chemsystems estimates that plans for nearly 1.8m tonnes/year of MEG capacity have been announced with four projects, each of 200,000 tonnes/year, already under construction and schedule to start operations in Q3 2011.
The interest in MEG and the new production route makes sense as China imported around 5m tonnes last year and the government has a clearly stated objective of reducing the country's dependence on petrochemical imports.
Its early days yet especially as we don't know the cost competitiveness of the new coal-based technologies but they could well pose a threat to companies relying heavily on exports to the Chinese market