Headwaters Technology Innovation Group (HTIG), a subsidiary of Headwaters, Inc., has delivered a feasibility study to Philippine President Gloria Arroyo that concludes that a proposed coal-to-liquids project for the Philippines is both technically and economically feasible.
The proposed plant is a hybrid plant which consists of a direct coal liquefaction unit (DCL), an indirect coal liquefaction unit (coal gasification and syngas cleaning unit plus a Fischer-Tropsch (FT) synthesis unit) and a power block.
The project is designed to produce up to 60,000 barrels per day of synthetic fuel at an estimated capital cost of US $2.8 billion. The output would meet approximately 15% of Philippine’s transportation fuel needs, resulting in estimated annual fuel cost savings of some $3.2 billion.
The DCL and FT units will each produce about 30,000 barrels per day of liquid fuels. These products will be blended together with minimum downstream refining to meet the required fuel specifications.
H&WB Corp of the Philippines is moving forward on the hybrid plant project by initiating financing for the next phase in which selected Philippine coals will be tested at HTIG to collect design data for the development of the front end engineering package. HTIG intends to sign a license agreement with H&WB prior to the starting of the Phase II program.
HTIG is the inventor and owner of the HTI Coal Process for Direct Coal Liquefaction and has developed proprietary Fischer-Tropsch synthesis catalyst technology. Also, its FT technology will be further developed by the end of 2006 through the demonstration project with UK RACE.
Headwaters recently entered into two non-binding Memoranda of Understanding (MOUs) to develop indirect liquefaction projects in Arizona and North Dakota. In February, the company signed an agreement with Shenhua Group in China for a direct liquefaction unit, due to come online in 2007. (Earlier post.)
Oil India Limited is also currently evaluating the DCL technology.
Coal-to-liquids technology falls into two major categories: indirect and direct liquefaction.
The indirect process first gasifies the coal, then uses the Fischer-Tropsch process to synthesize that gas into liquid fuels and chemicals.
The direct process dissolves a pulverized coal in a process liquid containing catalysts and treats the slurry under typical hydrocracking temperature of 435º–460º C in the presence of elevated hydrogen overpressure (about 170 bars). The resulting synthetic crude liquids are then upgraded to produce gasoline, diesel and jet fuels.
As to the relative environmental merits of the two types of approaches, an analysis done by Robert H. Williams and Eric D. Larson of the Princeton Environmental Institute on different methods of coal liquefaction found that:
...although direct liquefaction conversion processes might be more energy efficient, overall system efficiencies for direct and indirect liquefaction are typically comparable if end-use as well as production efficiencies are taken into account.
It is shown that some synfuels derived via indirect liquefaction can outperform fuels derived from crude oil with regard to both air-pollutant and greenhouse-gas emissions, but direct liquefaction-derived synfuels cannot.
Deployment now of some indirect liquefaction technologies could put coal on a track consistent with later addressing severe climate and other environmental constraints without having to abandon coal for energy, but deploying direct liquefaction technologies cannot.
And finally, there are much stronger supporting technological infrastructures for indirect than for direct liquefaction technologies.
The hybrid blending approach being proposed for this Philippines project may be trying to strike a balance between process efficiency and final fuel quality by using the FT fuels to reduce the amount of upgrading required for the DCL output.
Direct Coal Liquefaction: Lessons Learned (SRI International, 2005)
A comparison of direct and indirect liquefaction technologies for making fluid fuels from coal. Williams, Robert H. and Larson, Eric D. Energy for Sustainable Development VII, December 2003, 103-129