Sasol, the top energy firm in South Africa, is entering a
crucial phase in planning for its two giant coal-to-liquid (CTL)
projects in China.
"Now we are in the second stage of feasibility studies for our
two CTL projects," said Chen Liming, executive vice-president of
Sasol China.
The current study will determine details in capital costs,
feedstock costs, water supplies and market conditions and will
outline most of the major commercial and funding issues, said
Chen.
Sasol began planning with Shenhua Group Co Ltd and Shenhua
Ningxia Coal Ltd for the two CTL projects in 2004. It finished
preliminary studies at the end of 2005.
The studies confirmed that key elements are in place for
establishing a viable CTL business in China using Sasol's
low-temperature Fischer-Tropsch technology, said Chen.
Sasol's two projects one in Yulin, Northwest China's Shaanxi
Province and another in the Ningxia Hui Autonomous Region are
designed to produce 80,000 barrels of liquid fuels per day and
represent the company's largest investment outside of South
Africa.
Each plant is expected to cost US$5 billion to US$6 billion.
Should these CTL projects be brought to fruitition, they would
begin operation about 2013.
"Recognized as a world leader in producing fuel from coal, with
a track record of more than 50 years of proven commercial CTL
experience, Sasol offers China commercially proven and world-class
experience in converting coal reserves into synthetic liquid
fuels," said Chen.
The company has established an office in Beijing, including a
project team, to accelerate progress on the projects, he said.
The coal to chemical industry will be a growing sector in China,
according a medium- and long-term plan for the development of
industry, with the nation expected to invest more than 1 trillion
yuan in the field by 2020.
The nation will focus on the production of liquefied coal,
dimethyl ether (DME), coal-to-olefin (CTO) and coal methanol, said
the plan.
More and more foreign companies have entered China's coal
chemical industry, including US chemical giant Dow Chemical, world
energy giant Royal Dutch Shell and Thailand's Chia Tai Group.
Chen said the quick development of China's coal chemical
industry is beneficial for Sasol. "China has abundant coal
reserves. The proprietary and proven Fischer-Tropsch technology
offers China a compelling and competitive way to meet its future
energy requirements in an efficient, reliable and sustainable
manner."
"Sasol's effort is facilitating China on its road to energy
safety and diversification. Meanwhile, Sasol's endeavor is a proof
of China-Africa's two-way cooperation," he said.
"Establishment of the two plants in the western hinterland will
result in thousands of new jobs and spin off economic development
outside of China's existing high-growth regions," he added.
(China Daily January 30, 2007)