OVERVIEW OF COAL-TO-LIQUIDS: A HISTORICAL PERSPECTIVE

2 Background

Generally, methods for converting coal into liquid fuels fall into two liquefaction processes: direct and indirect. As the names imply, direct processes directly convert coal-based hydrocarbons into liquid fuels, while indirect processes use an intermediate process (gasification) to convert the coal into a gaseous fuel (syngas) before further refining the syngas into liquid fuels. Exhibit 2-1 gives a general overview of the processes involved.

Direct Liquefaction

CoalFeedstock

Preheating

Drying Slurrying

Hydrogen Pretreating

Pyrolysis/ Carbonization

Hydrogenation Liquefaction

Liquid Upgrading

Gasoline, Diesel, Jet Fuel

Indirect Liquefaction

CoalFeedstock

Preprocessing/ Drying

Gasification

Fischer-Tropsch (F-T) Methanol Synthesis

Product Upgrading

Methanol-to-Gasoline (MTG)

Gasoline, Diesel, Jet Fuel, Wax, DME

Gasoline, LPG

Each of the processes outlined in Exhibit 2-1 is chemically intensive compared to traditional oil refining [1], and have varying costs and potential profit margins. In terms of fundamental chemistry, the processes combine a carbon source with a H2 source to form hydrocarbons of desired molecular weight range (synthetic crude oil or syncrude), which can be further refined into compounds that can reliably be mixed with traditional petroleum-based fuels.

2.1 DIRECT PROCESSES

The DCL approach involves reacting coal with H2 to produce liquid hydrocarbons directly. This approach follows two main routes to achieve the desired end-products: pyrolysis/carbonization and hydrogenation. While similar, the key differences between the two are when and how the H2 is supplied to the coal feedstock and the nature of the final liquefaction process. Both routes require some form of upgrading or refining before the obtained liquids can be used in most applications, especially for transportation [2] In theory, DCL processes tend to be simpler and more energy efficient than indirect processes, but they require an external source of molecular