Can not help but listen to the advice: Coal glycol is difficult to pass three levels

In 2011, the coal-based ethylene glycol boom started again, and the construction site was blooming. (He Wall Photo)

Sinochem’s new network news entered 2011, and the coal-based glycol has set off again. Affected by multiple factors such as strong demand in the polyester industry, the price of ethylene glycol in China has continued to rise, and the current market price has risen to nearly 10,000 yuan/ton. In addition, the construction of the ethylene glycol project was also in full swing. On January 14, Anhui Donghua Engineering Technology Co., Ltd. signed a 300,000-ton/year ethylene glycol project with Luxi Coal Chemical Investment Co., Ltd. General contract, the contract duration is 26 months, and the contract price exceeds 3 billion yuan.

The heat of coal-based ethylene glycol has attracted the enthusiasm of some securities and investment institutions. Many research institutions believe that coal-based ethylene glycol will face a huge market of tens of billions of yuan in the coming years. Under such circumstances, many companies have once again focused their investment on ethylene glycol, and some have already begun feasibility studies. However, CCIN reporters have recently heard many companies worry about the ethylene glycol market. The main concern is whether China's coal-based glycol technology is mature or not. Is there any advantage in the cost? How big is the market? As a result, CCIN reporters interviewed a number of industry insiders with these three major issues. They really heard the opposite of the current zeal for coal-based glycol.

Is the technology mature?

The first set of demonstration devices has not yet stabilized production

In December 2009, the world's first coal-to-ethylene glycol industrial demonstration project - Inner Mongolia Tongliao Gold and Coal Chemical Co., Ltd. 200,000 tons/year coal-to-ethylene glycol industrial demonstration project opened the whole process, and coal-based glycol technology caused investment Party's attention. According to CCIN reporters, only one province in Henan this year would like to launch 5 sets of devices. In Shanxi, Hebei, Inner Mongolia and other places, the coal-to-ethylene glycol project also has the intention of starting construction this year. Especially in China's resource-rich Inner Mongolia, coal-to-ethylene glycol is gaining momentum. In October 2010, the 200,000-ton/year coal-to-ethylene glycol project of Inner Mongolia Sunite Alkali Co., Ltd. designed by Donghua Science and Technology General Contract Co., Ltd. was fully started. This month, a group of green clean energy co-investment companies established by seven large-scale private enterprises in China announced that they plan to invest and build a 1 million-ton coal-to-ethylene glycol project in Inner Mongolia.

However, Professor Fang Dingye, a professor of East China University of Technology and a member of the Technical Committee of the National Carbon-Chemical Engineering Research Center, believes that the current coal-based glycol technology is not yet mature and incomplete. There are four major problems. One is that the hydrogenation catalyst has not been tested for a long period of operation; the second is that the catalyst contains chromium, and the stability is not good; third, there is a problem with product quality; whether ethylene glycol can meet the requirements for polymerization grade products remains to be tested; and fourth, the pilot test is conducted from a small scale. There is an magnified problem in installing large-scale industrialization projects.

Wang Hao, a senior engineer at the Institute of Petroleum and Chemical Industry Planning, believes that the biggest problem with coal-based glycol technology is that hydrogenation catalysts have not been tested for long-term stable operation. Hydrogenation catalysts are the industrial problems that limit the maturity of coal-based glycol technology, and all parties are working on it. "During the 12th Five-Year Plan period, coal-based glycol technology can be fully matured," said Wang Hao.

Some experts pointed out that the Tongliao Gold Company's 200,000-ton/year coal-to-ethylene glycol industrial demonstration unit has not yet demonstrated that the technology has matured, but it is necessary to pass long-term, safe and stable continuous operation assessment tests to prove the technology. Is it really mature? The current practice results also indicate that the demonstration project has not been able to increase the load and product quality due to catalyst and process problems. A number of industry experts also told CCIN reporters that at present, the first demonstration unit in China has not yet been produced in a stable manner, so coal-based ethylene glycol is not yet a mature technology. Enterprises can't go beyond the demonstration stage and are anxious to find a success.

Is there a cost advantage?

Higher cost than domestic petroleum law and imported products

All along, the mainstream view in the industry is based on this argument: Compared with petroleum glycol, whether coal-based glycol has a cost advantage depends on international oil prices and availability of cheap coal resources. According to the experimental data released by Tongliao Gold Coal Company, the total cost of the company's 200,000-ton/year coal-based glycol demonstration plant is around 4,000 yuan/ton, if the coal price is 750 yuan/ton, when the oil price is no less than 67 dollars / Coal barrel ethylene glycol will have a cost advantage. CCIN reporter also saw such an expression in the coal-to-ethylene glycol project report of a company in Henan. The price of ethylene glycol is basically the same as the international crude oil price. The international crude oil price will directly affect the coal-to-ethylene glycol Economical. When the international crude oil price is 60 US dollars/barrel, the price of domestic petroleum glycol is estimated to be around 7670 yuan/ton; if the coal price is below 535 yuan/ton, the coal-based glycol project will be economical.

“Actually, when calculating the cost of coal-based glycol, it is misleading to compare with international oil prices.” Tang Hongqing, senior engineer at China Petrochemical Engineering Co., Ltd. told CCIN reporters. He believes that domestic oil prices should be calculated in accordance with the actual import prices of that year and the quality of imported crude oil, and cannot be equated with international oil prices. If peers stare at a point in the international oil price, there will be errors and companies will suffer losses. . At the same time, there are hundreds of products in Sinopec and PetroChina. Ethylene glycol is just a by-product. Their cost is calculated as a general ledger, and each product can adjust its price. Moreover, when companies calculate costs, there is a misunderstanding that the bank interest of their own funds is not included in the cost. Therefore, a comprehensive comparison shows that the cost of coal-based ethylene glycol is higher than that of petroleum-based ethylene glycol.

So, compared with the ethylene glycol in the Middle East, how is the cost of coal-based ethylene glycol in China? According to Wang Hao, the use of ethylene glycol in the Middle East (ethane, propane, etc.) to produce ethylene glycol has an unparalleled cost advantage. Converted to specific costs, the full cost of ethylene glycol from Middle East to East China (including freight and customs duties) is 3,700-3,800 yuan / ton. In China, coal-derived glycol is produced from coal gasification to syngas (carbon monoxide and hydrogen), and then oxalic acid esters are synthesized and hydrogenated to ethylene glycol. If the technology is fully mature, the total cost of coal-based ethylene glycol in the northwest region will be around 4,000 yuan/ton, the cost of transporting it to the East China market will be 4300 to 4400 yuan/ton, and that of Henan and Anhui will be 500 to 600 yuan. / Tons of coal to produce coal-based glycol, the total cost to be 4700 ~ 4800 yuan / ton, shipped to the East China market cost is 5,000 yuan / ton, higher than the cost of the Middle East, and there is no economic advantage.

How big is the market?

Foreign imports of low-cost and low-price products are increasing year by year

The opinion of the industry generally holds that there will be a clear gap between supply and demand in the domestic ethylene glycol in the next few years. So is this view true? The CCIN reporter also consulted relevant industry insiders.

According to the CCIN reporter, due to the strong demand of polyester and other industries, although the production capacity and output of ethylene glycol in China have grown rapidly, they still cannot meet the growing demand in the domestic market, and many rely on imports each year. Since 2002, China's dependence on the import of ethylene glycol has been above 70%. According to customs statistics, in 2003, the import volume of ethylene glycol in China was 2.516 million tons, which reached 5.216 million tons in 2008. In 2009, the import volume increased further to 5.828 million tons. In 2010, the import and export of ethylene glycol in China increased even more. The import volume is about 6.644 million tons.

Then, will the gap between the supply and demand of ethylene glycol in China in the next three to five years be reduced or will it continue to expand?

Wang Min told CCIN reporters that it is expected that by 2015, the domestic consumption of ethylene glycol will reach 11.2 million tons, while the domestic supply capacity in the same year will be 5 million tons, and the supply and demand gap will reach 6.2 million tons.

It is understood that the domestic petroleum glycol project may be built before 2012, there will be Sinopec Wuhan ethylene 300,000 tons / year project and CNPC Sichuan ethylene 380,000 tons / year project. The planned coal-to-ethylene glycol project has a total capacity of more than 3.2 million tons. If half of the production capacity goes into production within three years, China will increase its ethylene glycol capacity by 1.6 million tons per year. With the existing production capacity, the total ethylene glycol production capacity in 2012 is expected to reach about 6.43 million tons. If calculated according to 75% of the operating rate, the output is about 4.8 million tons. By 2012, the total consumption of ethylene glycol in China will be about 10.5 million tons. At that time, there will still be about 5.7 million tons of ethylene glycol in China, which needs to be supplemented by imports.

By comparison, it can be concluded that in the next 3 to 5 years, there will be a supply and demand gap of 5 to 6 million tons of ethylene glycol in China.

However, experts also reminded that although there is a large gap between the supply and demand of ethylene glycol in the future, it does not mean that companies can expand production. Because of the global market integration, the Chinese market is hard to keep up with. It is understood that the world's ethylene glycol production capacity has shown an excess situation. Wang Hao said that during the "12th Five-Year Plan" period, Saudi Arabia will add 2.7 million tons of ethylene glycol capacity, Iran will increase 700,000 tons, and Kuwait will increase 600,000 tons, and South Korea, India and Singapore will also add new three countries. 1.8 million tons, so that the Middle East and Asia will add nearly 6 million tons of new production capacity.

Dr. Cui Xiaoming, a senior engineer at the Institute of Beijing Yanshan Petrochemical Co., Ltd., told CCIN that because of the relatively insufficient supply of ethylene glycol in China, it has become a market that the world's ethylene glycol manufacturers are competing to seize. In addition to Canada, the United States, Japan, and the Taiwan region of China, the ethylene glycol manufacturers in the Middle East, Saudi Arabia and other countries are also expanding their exports to China by virtue of their cheap resource advantages. In particular, China’s imports of ethylene glycol from the Middle East have increased year by year. Therefore, even if the domestic ethylene glycol technology is fully mature, it will also be impacted by low-cost, low-price products in the Middle East, and it may not be able to be cheap.