http://www.osti.gov/scitech/
We note, by way of introduction, that our US Government has changed the way it archives it's electronic files of information pertaining to energy. Consequently, some of the links we have provided in past reports to, especially, USDOE records of National Laboratory and USDOE-contracted research might not endure and remain viable, functional. That fact, combined with the sheer volume of information represented by our prior reports, as preserved on the West Virginia Coal Association web site, in their Research and Development archives, might lead to undesirable repetition.
We regret that potential, but, additionally, recognize that some of the information bears repeating.
That said, we return to what seems to have been, perhaps remains, a major United States Department of Energy research project into the economics of converting, on a large industrial scale, some of our abundant Coal into a substitute for the petroleum we now indenture our grandchildren's economic future to the tender, loving nations of OPEC to keep ourselves supplied with in the here and now.
Further, the USDOE effort we refer to has, insofar as we have yet been able to determine, perhaps due to the changes we noted in the government's archiving of records, not yet resulted in one final, comprehensive and organized, report being issued by the USDOE.
If we turn out to be wrong about that, we apologize; but, we're running with what we've got. We think it's important.
The full title of the USDOE report/project we bring to you herein is:
"Subtask 3.3 - Feasibility of Direct Coal Liquefaction in the Modern Economic Climate".
As we will see in reports to follow, there is a larger "task" to which "Subtask 3.3" belongs; and, even additional components - - at least one, with some we think very special significance, directly concerning West Virginia University - - of which "Subtask 3.3" itself is comprised.
As we will also see, the larger "Task", of which "Subtask 3.3" is a component, has to do with more than just "Direct Coal Liquefaction", or, as more conveniently abbreviated: "DCL".
And, one important quote from the report we enclose herein, a conclusion drawn from the research data by our United States Department of Energy's contractors, deserves to be presented as a foreword:
"cost data support the hypothesis that a DCL facility could be competitive with petroleum and profitable".
That fact - - that producing liquid hydrocarbons by the direct liquefaction of Coal can result in fuel products that are competitive with those now derived from natural petroleum on cost and performance bases, and can earn a profit at today's market conditions, which include the prevailing prices for Coal and for Petroleum products - - is the key takeaway from the report we bring to you herein, as excerpted, with additional comment inserted and appended, from the initial link in this dispatch to:
"Feasibility Of Direct Coal Liquefaction In The Modern Economic Climate
(Note: Should the initial link in this dispatch soon fail to function, as it might since, as we've noted, there are changes being made in the way in which our Government is maintaining it's electronic library of technical documents, we will be forwarding an electronic file of this report to the West Virginia Coal Association.)
Final Report for the period June 25, 2008, through June 30, 2009
U.S. Department of Energy; National Energy Technology Laboratory; Pittsburgh, PA
Prepared by: Benjamin G. Oster, et. al.; University of North Dakota, Grand Forks, ND
Cooperative Agreement Number DE-FC26-08NT43291
Abstract: Coal liquefaction provides an alternative to petroleum for the production of liquid hydrocarbon-based fuels. There are two main processes to liquefy coal: direct coal liquefaction (DCL) and indirect coal liquefaction (ICL).
Because ICL has been demonstrated to a greater extent than DCL, ICL may be viewed as the lower-risk option when it comes to building a coal liquefaction facility.
(As we've documented in many reports, including, for one example:
West Virginia Coal Association | US EPA Recommends Coal Liquefaction as a Clean Alternative | Research & Development; concerning: "Clean Alternative Fuels: Fischer-Tropsch; United States Environmental Protection Agency; EPA420-F-00-036; 2002; A Success Story (!) For the past 50 years, Fischer-Tropsch fuels have powered all of South Africa’s vehicles, from buses to trucks to taxicabs. The fuel is primarily supplied by Sasol, a world leader in Fischer-Tropsch technologies.Sasol’s South African facility produces more than 150,000 barrels of high quality fuel from domestic low-grade coal daily. The popular fuel is cost-competitive with crude oil-based petroleum products in South Africa";the "indirect coal liquefaction (ICL)" technology has already been well-proven, for more than half a century, on a large commercial, industrial scale.)
However, a closer look, based on conversion efficiencies and economics, is necessary to determine the optimal technology. This report summarizes historical DCL efforts in the United States, describes the technical challenges facing DCL, overviews Shenhua’s current DCL project in China, provides a DCL conceptual cost estimate based on a literature review, and compares the carbon dioxide emissions from a DCL facility to those from an ICL facility.
Executive Summary: The United States has been conducting direct coal liquefaction (DCL) research for
decades. This research was spurred by the petroleum price disruptions of the early 1970s. Large scale
DCL demonstrations and bench-scale research efforts resulted in an increased knowledge of DCL process operations and led to a better understanding of DCL process chemistry.
The largest challenge that currently faces the construction of a DCL facility is capital cost. This literature study found that the major areas where DCL research is still needed are reducing capital costs with improved catalysts, optimizing processes and catalysts for lignite, effectively separating ash from other heavy products, and optimizing refinery processes for coal-derived liquids.
Shenhua of China is currently bringing a commercial DCL facility online. That facility has estimated a break-even cost of $35–$40 per barrel of oil. Conceptual cost data obtained from the literature showed that DCL products from various technologies ranged from $25.54 per barrel of crude oil equivalent up to $140 per barrel of crude oil equivalent. For comparison, the average cost of petroleum crude oil in 2008 was $93.05, and the average selling price of West Texas Intermediate (WTI) crude oil in 2009 is projected as $42.
These cost data support the hypothesis that a DCL facility could be competitive with petroleum and profitable.
(Well, if an "average selling price (for) ... West Texas Intermediate (WTI) crude oil (of) "$42" per barrel "support(s) the hypothesis that a DCL facility could be competitive with petroleum and profitable", consider that, as can be learned via:
UP: 2013 West Texas Intermediate Crude Oil (WTI) Prices;
the price of WTI crude, right now, as of October 31, 2013, is "$96.38" per barrel - - which sort of makes the "hypothesis" of Coal liquefaction's competitiveness "with petroleum", and it's profitability, something of a certainty, doesn't it? That seems borne out by the above-cited "Shenhua of China", in our prior report:
West Virginia Coal Association | China Makes "Huge Profits" from Coal Liquefaction | Research & Development; concerning the news release: "'China Coal Producer Reaps Huge Profits From CTL Project'; Shenhua Group, China's largest coal producer, has made huge profits from its pilot coal-to-liquid (CTL) project in north China".)
The increased concern over the role of carbon dioxide (CO2) emissions in global climate change has made CO2 an important consideration when planning the construction of a coal liquefaction facility. Therefore, this study compared the CO2 emissions from a DCL process to those of an indirect coal liquefaction (ICL) process. Based on molar carbon balances, DCL can be a much more carbon-efficient process than ICL. In the ICL case study, it was found that 66 mol% of the carbon in the coal is lost as CO2. These emissions can be reduced to 50% by using a DCL process where a portion of the coal feed is gasified to produce hydrogen. Further CO2 emission reductions are realized when methane reforming is utilized as the source of hydrogen. In that case, only 20% of the carbon is lost in the form of CO2 emissions. Utilizing a CO2-free
source of hydrogen such as wind- or solar-powered water electrolysis would result in a DCL process that only loses about 11% of the carbon in the coal to CO2 emissions. Stated differently, depending on if the hydrogen for a DCL process comes from coal, natural gas, or renewable sources, a DCL process emits 16%, 46%, and 55% less CO2, respectively, than an ICL process.
(We are, in fact, uncertain how a Direct Coal Liquefaction process utilizing "a CO2-free source of hydrogen such as wind- or solar-powered water electrolysis" would result in the generation and emission of any Carbon Dioxide to speak of, aside from that generated by Coal mining and Coal haulage. Nonetheless, if the process of DCL emitted only "16%" of the CO2 generated by an ICL process, our guess is that would be on a par with, or even less than, the CO2 emitted by the refining of natural petroleum. And, despite the indications of the authors about the relative economies of the various Hydrogen production processes, as seen, for only one example, in our report of:
West Virginia Coal Association | USDOE Renewable Energy Extracts Hydrogen from Water | Research & Development; concerning: "United States Patent 8,444,846 - Method and System for Producing Hydrogen Using Sodium Ion Separation Membranes; 2013; Abstract: A method of producing hydrogen from sodium hydroxide and water is disclosed (and, a) system of producing hydrogen is also disclosed. This invention was made under a Cooperative Research and Development Agreement between Alberta Limited and Battelle Energy Alliance, LLC under Contract No. DE- AC07-051D14517, awarded by the U.S. Department of Energy. The U.S. Government has certain rights in the invention. A method of producing hydrogen ... wherein applying an electric potential to the electrochemical cell comprises supplying an electric potential to the electrochemical cell from at least one of solar power, geothermal power, hydroelectric power, wind power, and ... further comprising heating the electrochemical cell using heat produced from reacting the sodium and the water";
we're getting pretty darned good at generating Hydrogen from plain old H2O in efficient ways that utilize Carbon-free and essentially, aside from the needed capital expense, cost-free environmental energy, such as "solar power, geothermal power, hydroelectric power" and "wind power", to get the job done.
But, even if we do, one way or another, generate a little Carbon Dioxide during our conversion of Coal into seemingly-desirable things like domestically US-made "liquid hydrocarbon-based fuels", don't forget that, as seen for only one out of now many examples in our recent report of:
West Virginia Coal Association | USDOE Reaffirms CO2 to Gasoline Technical Viability | Research & Development; concerning: "United States Patent Application 20130281553 - Method of Producing Synthetic Fuels and Organic Chemicals from Atmospheric Carbon Dioxide; 2013; Assignee: Los Alamos National Security, LLC, NM; Abstract: The present invention is directed to providing a method of producing synthetic fuels and organic chemicals from atmospheric carbon dioxide. Carbon dioxide gas is extracted from the atmosphere, hydrogen gas is obtained by splitting water, a mixture of the carbon dioxide gas and the hydrogen gas (synthesis gas) is generated, and the synthesis gas is converted into synthetic fuels and/or organic products. This invention was made with government support under Contract No. DE-AC52-06NA25396 awarded by the U.S. Department of Energy. The government has certain rights in the invention";
we should be able to find something modestly productive to do with that Carbon Dioxide - like make even more "synthetic fuels".)
DCL routes can be grouped into two kinds of processes. One, called hydroliquefaction or catalytic liquefaction, uses catalyst mixed with coal to achieve liquefaction. The other process, called solvent extraction, uses hydrogen donor solvents to liquefy coal in the absence of a catalyst. Although the processes are generally grouped in this fashion, the distinction is not clearcut. Hydroliquefaction processes may use both donor solvents and catalysts; some solvents function more as hydrogenation catalysts than as true solvents, and many of the metals considered catalytic to coal liquefaction are present in coal ash. The main distinction between the two types of processes is the intentional addition of catalyst material.
DCL grew out of work conducted in Germany prior to World War II.
In the original Bergius-IG hydroliquefaction process (developed in Germany before WWII, although) yields of liquid transportation fuel were high, the high costs of pressure, residence time, and hydrogen make the original Bergius-IG process uneconomical by today’s standards.
(Whether or not the original Bergius Coal liquefaction process would in truth be "uneconomical" today is, we think, debatable. Certainly, though, some genuine improvements upon it have been made. But, for the basics, see, for a few examples, our reports of:
West Virginia Coal Association | Bergius 1928 Coal Liquefaction | Research & Development; concerning: "United States Patent 1,669,439 - Process for Distilling and Liquefying Coal; 1928;Inventor: Friedrich Bergius, of Heidelberg, Germany; Abstract: This invention relates to improvements in a correlated process for distilling and liquefying coal" and:
West Virginia Coal Association | CoalTL Wins Nobel Prize - in 1931 | Research & Development; concerning: "The Nobel Prize in Chemistry 1931; Presentation Speech: Under Alfred Nobel's will, the Nobel Prizes are to be awarded to those who have been of the greatest benefit to mankind and, particularly in respect of the Prize for Chemistry, it is stipulated that this shall go to the person who has made the most important discovery or improvement in chemistry. The purpose of this work was ... the manufacture of oils and liquid fuels from solid coal, ... which is also known as liquefaction of coal. The products mentioned, which consist, in various proportions, of carbon and hydrogen and which are therefore referred to as hydrocarbons, were considered necessary to modern living, with vehicles and ships being run on petrol and other liquid fuels. Since the natural stocks of petroleum are fairly restricted, we would sooner or later be faced with the need to restrict the use of oil for the purpose mentioned or even to stop using it altogether, unless methods were available whereby these oil products could be artificially made from other crude materials at an acceptable price. According to the composition of the coal, it is possible in this way to extract 50 to 70% of the carbon contained in the raw material in the form of oils ... . Bergius (has) shown how, by the injection of hydrogen under pressure, pit coal, brown coal, and other carbon-bearing materials can be processed to liquid fuels which are considered indispensable in modern life for the propulsion of ships and vehicles (and, has) thereby obviated the danger which threatened of exhaustion of petroleum deposits, an event which must have happened sooner or later".)
In the United States after World War II, the German processes were modified through the use of better solvents and more robust catalysts. Work conducted from the 1950s through the early 1980s focused primarily on bituminous coals, and conditions were optimized for these coals.
(Not that we've been publicly informed about any of that multi-decade United States effort to improve the direct conversion of "bituminous coals" into "liquid transportation fuel".)
After the early 1980s, interest in DCL declined as oil prices fell and supply stabilized. Most of the work conducted in the 1990s focused on developing improved catalysts or reactor designs. Despite limited governmental or financial interest in coal liquefaction, a small number of processes did continue to move forward at the process development scale. These included the catalytic two-stage liquefaction (CTSL) process developed by HTI, which built off of the H-Coal process developed in the 1970s but incorporated two reactor stages and an inline hydrotreater for higher distillate yields. A 3-ton-per-day (tpd) process development unit (PDU) was run at Lawrenceville, New Jersey, for several years in the 1990s and showed good yields using both bituminous and subbituminous coals.
(The above "HTI" was formerly "HRI", and we've documented the development of their "two-stage liquefaction" and "H-Coal" processes previously, as for one example in our report of:
West Virginia Coal Association | New Jersey (!!!) Liquefies Coal | Research & Development; concerning: "'New technology concept for two-stage liquefaction of coal: conceptual commercial plant design and economics'; Hydrocarbon Research, Inc., Lawrenceville, NJ; Report: DOE/PC/60017-T2; Hydrocarbon Research, Inc. (HRI) is conducting a program for the United States Department of Energy (DOE) for evaluation of a ''New Technology'' concept for Catalytic Two-Stage Liquefaction of coal".)
In Japan, the NEDOL process was demonstrated in a 150-tpd pilot plant during the late 1990s.. The process has been tested with two low-rank Indonesian coals and a Japanese bituminous coal. The NEDOL process seemed to favor subbituminous coal, as yields of oil using the Indonesian subbituminous coal were superior to oil yields using the other two coals and the yield of undesirable residuals was highest using the Japanese bituminous coal in the pilot plant.
The Kohleol (“coal oil”) process developed by Ruhrkohle AG was also demonstrated on the pilot scale at Bottrop in Germany. The pilot plant had a 200-tpd capacity and operated from 1981 to 1987. The process was fairly similar to the original Bergius process in terms of catalyst, temperature, and residence time, but modifications to the original process design allowed a significant reduction in pressure from 10,000 to around 4000 psi.
All three of these processes are now considered close to commercial scale. The Shenhua facility in Erdos, China, which at 7000 tons of coal per day is slated to be the largest DCL plant ever built, incorporates elements of each process with the HTI design as its core technology. The estimated selling price of fuel from Shenhua-I (SH-I) is reported to be $31 (2009 U.S. dollars [USD]) per barrel.
In July of 2008, crude oil prices were over $130 per barrel.
(Thus, our earlier report, as cited above, concerning: "China Coal Producer Reaps Huge Profits From CTL Project". The USDOE then outlines several direct Coal liquefaction technologies, and draws some conclusions about them.)
An economic comparison (of various Coal conversion technologies, as documented and explained, shows that US Coal can be liquefied at costs from ) $45.94/bbl (of) product (to) $38.35/bbl.
Although progress has been made in DCL over the last 20–30 years, a number of technical obstacles remain. The common theme to all obstacles is reducing capital cost, which has by far the greatest impact on the cost of DCL fuel. The major areas in which research is still needed are the following:
- Reducing capital costs with improved catalysts
- Optimizing processes and catalysts for lignite
- Effectively separating ash from other heavy products
- Optimizing refinery processes for coal-derived liquids
In summary, DCL appears to be closer to commercial reality than it has been in the past. Economic estimates put the minimum selling price of DCL fuel below the price of crude oil as of November 2008. However, the large capital investment remains a hurdle both for further lowering the selling price of DCL fuel and for attracting investors. Any research that leads to lower capital cost is likely to bring DCL closer to large-scale commercialization.
One of the easiest ways to reduce capital cost would be to have a single-stage reactor without downstream processing. However, iron- and molybdenum-based catalysts only give high distillate yields when used in staged reactors, and hydrotreating is always necessary to reduce sulfur, nitrogen, and aromatics content of the fuel. To use a single-stage reactor and avoid downstream processing, a new type of catalyst would be required. Conoco overcame the problem of installing staged reactors and hydrotreating by using molten zinc chloride as a catalyst.
(The use of Zinc Chloride in Coal hydrogenation is a little more complicated than it might at first sound from generalizations like the above statement. We've documented Consol, later Conoco, developments in the use of Zinc Chloride, and other Zinc Halide, catalysts for Coal hydrogenation previously, as for one example in:
West Virginia Coal Association | Consol Cracks Coal | Research & Development; concerning: "'Kinetics of Hydrocracking of Coal Extract With Molten Zinc Chloride; 1968; Consolidation Coal Company".
The USDOE's discussion ranges over a number of other Coal liquefaction topics; and cites a number of other Coal conversion projects that have been undertaken, such as the Alabama CoalTL pilot plant, as in, for one example, in our report of:
West Virginia Coal Association | DOE/BP Liquify Alabama Coal | Research & Development; concerning:
"Analyses of Illinois no. 6 Coal Liquefaction results generated in the Wilsonville, Alabama Unit; BP Products North America; Inc., A database was set up to correlate the coal liquefaction results generated at the Department of Energy (DOE) Advanced Two-Stage Coal Liquefaction Facility in Wilsonville, AL".)
Although funding for DCL research and development efforts is very difficult to find, the concept of directly liquefying coal has not disappeared. Currently, the Shenhua Group Corporation of China (a government-controlled coal producer) is developing and implementing DCL efforts in an attempt to better utilize China’s vast coal resources. The construction of a commercial DCL plant, located 80 miles south of Baotou, at Majiata, Inner Mongolia, began in 2004 and is nearing completion. This is the first commercial DCL plant in the world, with a total production capacity of 24,000 barrels per day. The estimated capital cost of the plant is $1.5 billion USD for the first phase, which includes a total of three reactor trains. The second phase of the project will add seven additional reactor trains for an overall project cost exceeding $5 billion USD. The Shenhua coal liquefaction process (as illustrated) will initially process approximately 1.6 million tons of subbituminous coal annually. The estimated output products for the first phase of the project, in tons per year, are diesel fuel (591,900), naphtha (174,500), liquefied petroleum gas (LPG) (70,500), and liquid ammonia (8300).
The Shenhua process is an integration of American, German, and Japanese technologies as well as Shenhua’s innovations.
The process utilizes an inexpensive and highly reactive catalyst, relatively low temperatures and pressures, and has a high reaction efficiency of over 90%. The process is also capable of utilizing high sulfur and highly reactive coals. The estimated break-even cost of the liquid fuels produced by the first phase of the plant is currently equated to a crude oil price between $35 and $40 per barrel. This price does not include costs or revenues derived from the capture and disposal or sale of carbon dioxide streams from the plant. The carbon dioxide that is expected from the plant on a yearly basis is approximately 3.6 million tons, of which, 3.1 million tons of high-purity CO2 is captured from the hydrogen-making process and the rest comes from heating, flares, and power generation. Shenhua is currently evaluating options for sequestration, which include enhanced oil recovery operations, injection into unminable coal seams, and injection into deep saline
aquifers.
(All of which, as can be inferred from:
West Virginia Coal Association | August 13, 2013 Power Plant CO2 to High-Octane Gasoline | Research & Development; concerning: "US Patent 8,506,910 - Process and System for Producing Liquid Fuel from Carbon Dioxide and Water; August 13, 2013; Assignee: CRI Ehf, Iceland; Abstract: A process and system for producing high octane fuel from carbon dioxide and water is disclosed";should be seen as the unnecessary, unwarranted waste of a potentially precious raw material resource.)
The DCL price estimates support the concept that an operational DCL facility could be economically viable. Shenhua I and II, most notably, have the potential to produce liquid products that are less expensive than their petroleum counterpart".
--------------------------
We'll leave our excerpts at that, since there is more to follow related to the USDOE's project that led to the report, "Feasibility Of Direct Coal Liquefaction In The Modern Economic Climate", which is the subject of this dispatch, that directly involves West Virginia University.
Again, though, to be boorishly repetitive, as summarized by our United States Department of Energy and it's contractors:
"The DCL (Direct Coal Liquefaction) price estimates support the concept that an operational DCL facility could be economically viable (and) have the potential to produce liquid products that are less expensive than their petroleum counterpart".