World's first coal-to-oil mass converter due to start operation this year


Towering above the sweeping grasslands of Erdos, north China's Inner Mongolia Autonomous Region, two 60-meter-high cylindrical structures stand against the skyline.

The structures - reactors for liquefying coal - are part of a project to mass produce desperately needed fuel oils from China's rich coal resources. More than 10,000 workers from across China are constructing the massive project, the first industrial facility in Ejin Horo Banner. "The project is in its final stage of construction and will be ready for production late in the year," said Wang Yulong, deputy manager in charge of the coal liquefying arm of the Liquefied Coal Oil Company of Shenhua Group Corporation Limited, the country's top coal producer.

The facility will produce mostly diesel oil, plus liquefied petroleum gas (LPG), naphtha (a volatile, flammable liquid hydrocarbon mixture), and hydroxybenzene. With a budget of 12.3 billion yuan and an annual production capacity of five million tons of oils, the project will be completed in two stages. In the first phase, three production lines will be installed. "We're installing the first production line and its infrastructure," said Wang.

"Upon completion, the line will be able to process annually 3.45 million tons of coal into 1.08 million tons of oils, including 720,000 tons of diesel oil." Before starting the project, Shenhua successfully trialled technology at a specially built converter in Shanghai, according to Wang. "The project in Erdos is about 1,000 times the size of the Shanghai model," said Wang, claiming it would be both environment friendly and lucrative.

Preliminary estimates showed 3.4 to 3.5 tons of coal could produce a ton of oil, and if the price for a barrel of crude remained at $35, the facility would be profitable, said Wang. Industry observers say the Erdos project is significant to China's food and energy security. "The efficiency of conventional coal use is very low, but the profits from coal-oils can be much higher," said an expert surnamed Wu. "Moreover, grains, such as maize, will be spared from being processed into ethanol." (


MKIK: Local business tax should be maintained Analysis

MKIK: Local business tax should be maintained

Parl't votes to phase out savings coops integration framewor... Parliament

Parl't votes to phase out savings coops integration framewor...

Roche Szolgáltató appoints P&C business partner lead Appointments

Roche Szolgáltató appoints P&C business partner lead

Budapest airport shuttle bus service expanded City

Budapest airport shuttle bus service expanded


Producing journalism that is worthy of the name is a costly business. For 27 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.