China to build plant to turn coal into oil products
Date: 19-Jun-02
Country: USA
The clean coal technology will help the Chinese government counter complaints from environmentalists that the country's heavy reliance on coal causes too much pollution and greenhouse gas emissions that lead to global warming.
Shenhua Group Corp. Ltd is China's largest coal company, producing about 60 million tons of coal per year and having reserves of more than 220 billion tons.
The Bush administration has pulled the United States out of the international Kyoto treaty that seeks to reduce greenhouse gas emissions.
The administration fears the treaty allows developing countries such as China to spew more emissions while placing tough restrictions on industrialized nations that could hurt the U.S. economy.
Ironically, the U.S. Energy Department helped pay for the research that developed the clean coal technology that will be used by China to help reduce its emissions.
At a ceremony in Washington announcing the plant deal, Linda Conlin, the Commerce Department's assistant secretary for trade, praised China for being a leader in using clean coal technology.
Headwaters subsidiary, Hydrocarbon Technologies Inc., will provide the technology license, process design and technical services for the plant.
The $2 billion Chinese facility will able to produce 50,000 barrels a day of cleaner, low-sulfur diesel fuel and gasoline from about 13,000 tons of coal.
Plant construction is expected to begin in early 2003, following approval from U.S. and Chinese governmental agencies. The facility, located about 80 miles south of Baotou in Inner Mongolia, should be operational in 2005.
Under the so-called coal liquefaction process, coal is broken down into small molecules with hydrogen to form oil molecules that are then refined into diesel, gasoline and other petroleum products.
Sulfur, nitrogen, ash and other impurities are removed from the liquid fuel in the process.
Shenhua Group said it plans to build three more coal liquefaction plants in the Shengdong Coalfield of China, which spans the Shaanxi Province and Inner Mongolia.