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QGX Launches Mongolian Coal-to-Liquids Initiative

Baruun Naran is within trucking distance of major steel and power generation centers in northern China. Click to enlarge.

QGX Ltd., a Canadian company that has been exploring for mineral deposits in Mongolia since 1994, has engaged Nexant, Inc., a global energy consulting company with core competencies in coal gasification, Integrated Gasification Combined Cycle (IGCC), coal-to-liquids (CTL) Fischer-Tropsch (FT) processing and gas-to-liquids (GTL) technologies, to assess the technological and economic potential for applying CTL technologies to the coal at Baruun Naran in Mongolia.

Nexant’s initial review of the coal-quality data for Baruun Naran coal indicates that the coal appears amenable to coal-conversion applications.

QGX received a positive initial indication of support from the Mongolian Ministry of Fuel and Energy regarding a possible CTL project earlier this year. Currently Mongolia imports 100% of its transportation fuels.

The goals of the Nexant study, which is expected to last three months, are to:

  1. Assess the Mongolian and Chinese market demand and pricing for Fischer-Tropsch liquids (synthetic gasoline and diesel), olefins, methanol and di-methyl ether (DME);

  2. Select the most appropriate gasifier based on the properties of the coal and the commercial maturity of the gasifier; and

  3. Conduct a preliminary plant design, cost estimate, and financial analysis for each candidate product to assess its economic potential.

Current mining operations at Tavan Tolgoi (Baruun Naran).

Nexant is an affiliated company with Bechtel Corporation.

Baruun Naran is one of QGX’s two most advanced properties in Mongolia. One 7 June, QGX announced a resource for Baruun Naran of 107.5 million tonnes of metallurgical and thermal coal contained in Indicated and Measured and an addition 48 million tonnes contained in Inferred.



allen zheng

Crud, more carbon in the air. Maybe the silver lining is that the plants could be converted to biomass feeds in the future.


As this posting noted, Mongolia currently imports all of its liquid fuel needs. What this post does not note is that these imports are one of the highest (if not the highest) drains on the Mongolian balance of trade -- at least they were back in 2002 when I was there last, and I cannot imagine that the recent run-up in gas prices has been at all kind to them.

By providing a substitute for such imports, and/or a potential export commodity, the Mongolian treasury should benefit considerably.

A very large proportion of the Mongolian population still relies on traditional nomadic herding and animal husbandry for income. Limiting the toxic pollutants emitted by the plant will be important to maintaining the health of that sector -- though being directly adjacent to growing, polluting China likely affects their air quality more than any domestic choice could.

Mongolia is a fairly poor country by any standard. My guess is that they consume very few natural resources, especially non-renewable ones, on a per-capita basis. So my feeling on this project is -- good for them. I hope they collect good royalties on this non-renewable resource and invest the money wisely.

allen zheng

You do have a point there, the geopolitics of energy. Being sourounded by the Russians and the Chinese makes energy security a priority. That said, I do hope they could somehow use their large landmass, low population density to somehow sustainably make biomass. Being that far north (Siberian winters), and being arid/semi-arid is a problem for growing anything more than grass. One possibility may be using sewage treatment from their cities, Ulaanbaatar, to make algae biomass/oil. I heard some cities in New Zealand are doing it. It would also be a way to clean the sewage outflows too. The hurdle to be crossed would be financing. After all it is a poor developing nation.
___On a larger scale, what if all the towns/cities in the US/West upgraded their sewage treatment plants to include a step for algae. It would strip excess organic carbon, CO2, and soluable minerals in the sewage. I know land area is a matter, but many of these facilities cover acres of land.

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