China Energy Group to Build New Direct Coal-to-Liquid Production Lines

Ling Wen, General Manager of China Energy Group, revealed at the recently concluded Inner Mongolia International Energy Conference that the group will soon construct its second and third direct coal-to-liquid (CTL) production lines, expanding the scale of clean and efficient coal utilization.

China Energy Group’s subsidiary, Ordos Coal-to-Oil Branch, currently operates the world’s only industrialized demonstration line for direct coal liquefaction. The production line began construction in 2004 and successfully started trial production at the end of 2008, with a designed annual output of 1.08 million tons of diesel, naphtha, and other products.

Hu Qingbin, Deputy Chief Engineer of the company, told reporters that the core technology and catalysts for direct coal liquefaction were independently developed. Since the successful trial production, the demonstration line has gradually achieved long-cycle, full-capacity, high-quality, and safe operation, producing 860,000 tons of products last year.

Initially, the design value for a single operational cycle of the demonstration line was 310 days. The most recent two operational cycles reached 420 days and 410 days respectively, demonstrating significant improvements in equipment reliability and technological maturity.

The production line is approximately 1.2 kilometers long. Coal mined nearby is transported by conveyor belt to the plant, first pulverized into powder, and then sent into the production line for catalytic and other processing. After 24 hours, the other end of the line produces clean fuels such as diesel, comparable in clarity to bottled water.

“Our products outperform conventional diesel in terms of calorific value, pour point, and density,” Hu Qingbin explained. For example, the sulfur content of the coal-based diesel produced by the company is only one-tenth of the national standard, and it does not solidify even at minus 60 degrees Celsius.

Comprehensive calculations show that the company currently consumes about 3.5 tons of coal to produce one ton of oil. Excluding fuel coal, the raw coal input per ton of product is 2 tons. When international crude oil prices exceed $55 per barrel, the company does not incur losses. After the second and third production lines are completed, the oil yield is expected to increase by approximately 10%, lowering the breakeven crude oil price to below $50 per barrel.