Methanol - One Product - Many Possibilities

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1 Methanol - One Product - Many Possibilities 2015 Methanol Technology and Policy Congress Frankfurt, December 2 nd, 2015 l Dr. Matthias Stein l Air Liquide Global E&C Solutions 1 11/11/2015 Air Liquide, world leader in gases, technologies and services for Industry and Health

2 What is Methanol? One of the largest organic chemicals (by volume) Natural Gas in Liquid Form or Liquid Synthesis Gas Building Block for other Chemicals/ Polymers Global Global Product- Easy to transport and to store Energy Carrier Alternative Energy Competitor to to Crude CudeOil 2 02/12/2015 Air Liquide, world leader in gases, technologies and services for Industry and Health

3 The Chemistry of Methanol: Versatile and Future oriented 2014 Global consumption: 64 mil tonnes 2015 forecast: 73 mil tonnes Formaldehyde Olefins MTBE Ethylene glycol Syngas MMA Methyl amines Chloro methanes Hydrocarbons Gasoline Acetic Acid Aromatics 3 02/12/2015 Air Liquide, world leader in gases, technologies and services for Industry and Health

4 The Methanol Market tomorrow: Double Digit Growth Global Methanol Consumption (mil tonnes pa) 11% 11% 4% 31% Formaldehyde MTBE 2% 28% 15% Others Acetic Acid 22% Olefins 10% 18% 11% Gasoline Gasoline Blend 10% 18% 9% 2014: 64 mil tonnes pa 2020: 94 mil tonnes pa Sources: ICIS, IHS, AL Intelligence 4 02/12/2015 Air Liquide, world leader in gases, technologies and services for Industry and Health

5 Air Liquide Global E&C Solutions Technology Package Lurgi Technologies Cryogenic Technologies

6 We are designing your success The world leader in gases for industry, health and environment > 50,000 employees in over 80 countries worldwide Group Revenue of 15,2 billion (2013) Technologies in the World Business Unit of Air Liquide Global E&C Solutions 4,000 employees in 15 engineering centers worldwide Revenue of 646 million (2013) Air Liquide Global E&C Solutions provides solutions from technology licensing to EPC project services for the Air Liquide Group and third party customers. 6 02/12/2015 Air Liquide, world leader in gases, technologies and services for Industry and Health

7 Portfolio of Technologies Air Liquide id provides its customers with the best value in advanced innovative technology. Synthesis Gas Production (SMR, ATR, Gasification) and Purification (Rectisol, PSA, Cold boxes) Air Separation Plants Methanol and Methanol-to-Propylene Natural gas conditioning Acrylic acid, Butadiene, Melamine Oleochemicals, Biodiesel Fischer-Tropsch GTL 7 02/12/2015 Air Liquide, world leader in gases, technologies and services for Industry and Health

8 Key Messages 1. Methanol-to-Olefins to became a success. Today it satisfies China s large Olefins Appetite. 8 02/12/2015 Air Liquide, world leader in gases, technologies and services for Industry and Health

9 Methanol-to-Olefins: Growth Driver for Methanol Focus on large commodities ethylene and propylene, All world scale plants in operation are in China, MTO/ MTP using coal (and cheap natural gas) as feedstock in competition to oil based products (steam cracker, PDH), Significant technology developments from 2000, Many olefins plants are somehow based on a mil iltpa MeOH standard plant size. 9 02/12/2015 Air Liquide, world leader in gases, technologies and services for Industry and Health

10 The MTO Success Story begins in China China is operating a significant number of MTO plants (mainly ethylene), based on merchant Methanol. 5 MTO plants operating based on 2.1 mil tpa merchant MeOH (Q1 2015), Another 1 mil tpa merchant MeOH capacity for MTO will start up in 2015, A growing number of olefin plants are developed along the Chinese coast to consume imported MeOH Sources: IHS, Asiachem, AL Intelligence 10 02/12/2015 Air Liquide, world leader in gases, technologies and services for Industry and Health

11 and it continues even more massive in China. Far bigger are integrated Coal-to-Olefins capacities in China- 7 World Scale Plants in operation (Q4 2014); First MTO was Shenhua Baotou MTO, Inner Mongolia, start-up in MTP plants based on Lurgi Technology started in First MTO plant based on UOP technology start up in 2013 (Wison). 9+ plants are under engineering/ construction Plants in China are mainly coal based, MeOH MTO/ MTP integration in remote (coal mining) areas gives most competitive cost structure, Product focus is on regional markets in order to avoid transportation cost. Sources: IHS, Asiachem, AL Intelligence 11 02/12/2015 Air Liquide, world leader in gases, technologies and services for Industry and Health

12 Where is the technology coming from? Air Liquide s Lurgi MTP Technology Integrated into Lurgi Mega Methanol Technology, mainproduct is propylene, small volume of ethylene possible, gasoline and LPG as coproducts Dalian MTO (DMTO) Technology First MTO plant in China (Shenhua Baotou) is based on DMTO FCC like, fluidized bed reactor, mixture of propylene and ethylene UOP s MTO Technology Mixture of 1:1 ethylene and propylene that can be brought to a higher yield of propylene in an olefins cracking process (converting of higher olefins to ethylene and propylene) Sinopec MTO (SMTO) Technology Several references in China, FCC like, fluidized bed reactor, mixture of propylene and ethylene Several other MTP and MTO technologies without references are existing /12/2015 Air Liquide, world leader in gases, technologies and services for Industry and Health

13 Gas-to-Propylene Plants in the Western Hemisphere Engineering is ongoing for BASF s Gas-to-Propylene plant to be built at US Gulf Coast: 475 ktpa propylene plant based on Air Liquide s Lurgi Mega MeOH Technology as well as Lurgi MTP Technology, First Gas-to-Propylene plant outside China, BASF at its Investor Day 2014: MTP is best in class technology- up to 20% lower in total cost compared to next best technology. Fred Festa, CEO of catalyst producer WR Grace in ICIS News: FCC units remain the cheapest way to get propylene. The next cheapest process is methanol to olefins (MTO) PDH ranks third /12/2015 Air Liquide, world leader in gases, technologies and services for Industry and Health

14 Advantaged Feedstock Countries: Next MTP/ MTO Plants Russia USA Central Asia Iraq q Iran 14 02/12/2015 Air Liquide, world leader in gases, technologies and services for Industry and Health

15 Key Messages 1. Methanol-to-Olefins to became a success. Today it satisfies China s large Olefins Appetite. 2. Methanol-to-Gasoline is one channel to the Fuels Market for Feedstock Gas and Coal /12/2015 Air Liquide, world leader in gases, technologies and services for Industry and Health

16 Methanol-to-Gasoline: ExxonMobile and Air Liquide together Synthetic gasoline as competitive alternative to refinery gasoline, Meets and exceeds existing gasoline standards, d Also suitable for diluting highly viscous oil, or blending into the refinery gasoline pool. ExxonMobile is offering a well proven technology, based on the experience of 10 years of operation of a commercial plant in New Zealand. Air Liquide is marketer of EM s MTG technology in connection with Lurgi Mega Methanol, 5,000 tpd Mega MeOH plant is producing 16,500 bpd or 650 ktpa of gasoline, MeOH based gasoline is practically free of sulfur, 1 plant operating (100 ktpa), 1 plant under construction (1 mil tpa), both in China /12/2015 Air Liquide, world leader in gases, technologies and services for Industry and Health

17 Methanol-to-Gasoline: More Technology Other MTG technology providers: HaldorTopsoe: TIGAS Process, is an integrated Syngas-MeOH- Gasoline process Reference plant based on 5,000 tpd under construction in Turkmenistan. ICC-CAS together with SEDIN Engineering developed a process in China, 9 plants betweeneen 100 and 200 ktpa capacity each are operating /12/2015 Air Liquide, world leader in gases, technologies and services for Industry and Health

18 Key Messages 1. Methanol-to-Olefins to became a success. Today it satisfies China s large Olefins Appetite. 2. Methanol-to-Gasoline is one channel to the Fuels Market for Feedstock Gas and Coal. 3. Today China is developing more MEG capacities from Coal through Syngas than from cracker ethylene /12/2015 Air Liquide, world leader in gases, technologies and services for Industry and Health

19 Ethylene Glycol is made from Coal: Coal-to-MEG Coal-to-MEG is a syngas based technology with MeOH appearing as an intermediate. Oxygen Methanol Coal Carbon monoxide Dimethyl Oxalate MEG NG Hydrogen The alternative is Eastman/ JM Davy Methanol to Glycol Process: Coal NG Syngas Methanol MEG 19 02/12/2015 Air Liquide, world leader in gases, technologies and services for Industry and Health

20 7 Companies offer Oxalate Technology for MEG 6 Chinese Companies and Institutes as well as one Japanese company offer a technologies, only 4 are referenced and successful: Fujian Institute of Research (FJIRSM) 6 plants are operating Shanghai Huayi (Shanghai Coking) 2 plants operating Sinopec 1 plant operating Ube Industries A 50 ktpa plant is operating since 2013, showing constistently fibre grade MEG production, 2 plants are operating, 3 plants are under construction (total of 1 mil tpa) /12/2015 Air Liquide, world leader in gases, technologies and services for Industry and Health

21 From 2011 until today: CTMEG became significant in China After 2016 First demonstration 11 operating plants 21 operating plants There are 23 plants plant based on FJIRSM-CAS expected with a total of 2 mil tpa capacity, expected to be on stream with a total of studied with >10 mil tpa capacity, technology (Fujian Institute t of Research, Chinese Academy of Science) 7 technology providers 3.8 mil tpa capacity, Plants are very small ( ktpa), New MEG capacity in China is mainly based on CTMEG, More capacity than demand growth, Low operating rate due to quality issues (no fibre grade MEG) (except Ube Technology) China will be self suffcient in MEG by /12/2015 Air Liquide, world leader in gases, technologies and services for Industry and Health

22 Key Messages 1. Methanol-to-Olefins to became a success. Today it satisfies China s large Olefins Appetite. 2. Methanol-to-Gasoline is one channel to the Fuels Market for Feedstock Gas and Coal. 3. Td Today China is developing more MEG capacities from Coal through Syngas than from cracker ethylene. 4. Methanol-to-Aromatics will become reality in Future. Target product is para-xylene 22 02/12/2015 Air Liquide, world leader in gases, technologies and services for Industry and Health

23 Methanol-to-Aromatics is at the beginning Aromatics are mainly BTX- Benzene, Toluene and Xylenes, Most wanted product is para-xylene for PTA and polyesters, Chinese institutes have developed Coal-to-MeOH-to-Aromatics Processes, First large pilot plant started in 2013 (30 ktpa) based on the FMTA Process of Huadian Group and Tsinghua University, Shanxi Coal Chemical and Sinopec operate plants with 100 ktpa and 200 ktpa capacity, All technologies oogessuffering from low PX yedsa yields and dunfavorable oabe economics at this time. Promising may aso also be the modification o of Methanol-to-Gasoline o e processes to produce aromatics /12/2015 Air Liquide, world leader in gases, technologies and services for Industry and Health

24 Conclusion New Methanol Derivatives provide strongest demand growth for the commodity Methanol, China with its strong appetite for commodity chemicals is the main driver for developments, Lack of natural a gas in China is focusing on coal as feedstock, The Old World is cautiously looking at the application of new technologies, clearly driven by economics, Beside fuel applications, chemicals provide double digit growth of Methanol. Future technology developments may skip Methanol as an intermediate and convert syngas directly to chemicals!? 24 02/12/2015 Air Liquide, world leader in gases, technologies and services for Industry and Health

25 Cornelis Willems de Man ( ) Delft Pharmacy, 1670 National Museum Warsaw 25 02/12/2015 Air Liquide, world leader in gases, technologies and services for Industry and Health