Recent increases in oil and gas prices have pushed the chemical industry to a “strategic turning point” for the use of coal to produce chemicals, said officials at Nexant Inc., San Francisco.
That change also is being driven by “unprecedented” energy demand growth in developing countries, particularly in Asia, and advances in coal utilization processes, such as gasification, and related environmental technologies.
“While these factors are only partly interrelated, they appear to be having a compound effect on the global chemical industry,” Nexant said. “For example, in regions with rapidly growing demand, the logistics of obtaining imported feedstocks in interior regions may now have shifted the overall feedstock ‘equation’ toward using local coal resources.”
Even in developed economies such as those of North America, the company said, “The future of new competitive capacity for producing large-volume commodity chemicals may now be shifting toward coal.”
In a new study, Nexant analyzed the technologies and economics of using coal to produce major petrochemicals via gasification and other known processes.
“Cost-related issues are a major consideration affecting the growth and success of coal-based chemicals, as costs are intertwined with the competitiveness of coal-based processes compared to mature, conventional process routes and feedstocks,” company officials said. “Though proven cost-competitiveness will be a critical hurdle for coal, several other issues must also be considered.” These include:
• Continued improvements in gasification and auxiliary system technologies related to environmental concerns.
• Competition from alternate low-cost feedstocks and processes such as remote or stranded gas from the Middle East, Eastern Europe, and Africa.
• Forecasted shortfalls for conventional feedstocks and key chemical products and intermediates in China, potentially offset by China’s large coal reserves, coupled with the success and growth of chemicals produced from acetylene.
Global crude reserves may be entering a diminishing phase, and consuming nations worry about increasing reliance on oil and gas from unstable sources.
“The growing impetus to reduce that dependency, especially in the US, will put more pressure on domestic alternatives, regardless of concerns about coal and related environmental issues,” Nexant reported.
The likelihood that the price difference between crude and coal will continue to increase is another critical factor, the company said.
“The growth in coal-based production of chemicals will ultimately be dependent on cost competitiveness, both for gasification-based production and for chemicals produced from acetylene, as in the case of the growing vinyl chloride production in China,” it said. “The relatively high cost of ethylene from methanol produced from coal cannot compete with ethylene produced from conventional cracker processes in the US.”
However, the Nexant report supports the economic competitiveness of a wide range of materials produced from coal, including methanol, ammonia and fertilizers, polyolefins, acetyls, and formaldehyde (all from coal-synthesis gas via gasification), and vinyl acetate and acrylic acid (via the coal-acetylene route).
“Ultimately, it is expected that coal-based chemical production can leverage its advantages into a promising future that successfully addresses environmental issues and encourages energy and feedstock diversity,” Nexant said. ✦
