Shenhua Direct Coal Liquefaction Project Breaks New Ground (Cornerstone Magazine)

Shenhua’s DCL Project: Technical Innovation and Latest Developments

By Shu Geping
Chief Engineer, China Shenhua Coal to Liquid and Chemical Co., Ltd.

Direct coal liquefaction (DCL) is the most effective approach for the production of liquid products from coal; the energy conversion efficiency can be 60% or greater. DCL also offers important strategic and practical benefits to China in regards to solving problems such as shortages of petroleum resources, balancing the energy mix to rely more heavily on strategically secure coal reserves, as well as a sustained, steady growth of the national economy.

The Shenhua DCL project is a commercial-scale demonstration project that is the first in the world to adopt modern DCL technology; the project is based on creativity and exploration and is demonstrating the promise of the technology to the rest of the world.

Technical Innovation in the Shenhua DCL Project

Development of the Core Process and Initial Scale-Up

Advancement of the Shenhua DCL Process

The Shenhua DCL process, see Figure 1 for a process schematic, is the most critical technology within the entire project. The capacity of the project is 30 times larger than any other DCL units operating now or in the past. Compared with existing processes both in China and abroad, the Shenhua DCL process is clearly more advanced based on the following features:

  1. Largest capacity of any single production line: The liquefied coal processing capacity of the single-production line in the Shenhua DCL process is 6000 tonnes/day of dry coal, whereas the capacity of the largest production line abroad is only 2500–3000 tonnes/day of dry coal.
  2. Superior synfuels yield: The high-performance solid catalyst used in the Shenhua DCL process means that less catalyst is required and the yield of distilled synfuels is greater than that of the DCL processes abroad that operate under the same conditions.
  3. Improved stability: The overall stability of the Shenhua DCL process is greatly superior to that of DCL processes abroad.
  4. The Shenhua DCL process is a proven process: the first in the world to have undergone verification at the bench scale, pilot scale, and demonstration at the megaton industrial scale. Thus China has become the sole nation with a megaton-scale proven DCL technology.

Preparation of the DCL High-Performance Catalyst

The DCL high-performance catalyst is one of the critical technologies responsible for increasing the coal conversion rate and product yield as well decreasing the severity of DCL process operating conditions (i.e., temperature and pressure can be significantly lower when the catalyst is employed).

The Shenhua Group and the China Coal Research Institute, financially supported by the 863 Program of the Ministry of Science and Technology, jointly developed the DCL high-performance catalyst. During laboratory-scale research, the process and key operating parameters were defined, solutions were developed to avoid unintended reactions, and control parameters were developed for the precipitation and oxidation process. A continuous test unit with a production capability of three tonnes per day of catalyst was constructed. Subsequently, a unit for continuous preparation of the 863 catalyst (named after the program under which it was developed) to provide catalyst for the pilot-scale DCL demonstration was constructed in the Shenhua pilot-scale R&D center. For the DCL demonstration project the catalyst production process was proven after it was scaled up by a factor of 1000 times.

DCL Synfuels Processing

Because the properties of DCL-derived synthetic fuels greatly vary from those of conventional petroleum, upgrading of DCL-derived synthetic fuels requires stricter processing conditions compared with conventional crude oil refining. In addition, catalysts and processing techniques must be specifically developed based on the properties of the DCL-derived products and processing techniques. Catalysts developed in China were adopted in Shenhua’s DCL project; a new combined process of product refining and product modification was also developed. Thus, liquefied petroleum gas (LPG) has been processed into high-quality diesel and naphtha. The market for these products is favorable, with highly saleable products and byproducts (e.g., diesel, naphtha, and liquefied natural gas).

Overcoming Hurdles in the DCL Process

Reactor Resistance to Mineral Sedimentation

Globally, mineral accumulation is common in DCL reactors, which is especially prone to occur when high-calcium content coal is used, as is the case for the Shenhua DCL project. To solve the problem of sedimentation, Shenhua first investigated how to solve the problem at the bench and pilot scales. The reactor type and dimensions of the internal components were determined at the bench scale and then at the pilot scale using a 1-m diameter cold-flow model. Sedimentation of the minerals in the reactor is avoided by controlling the superficial liquid velocity, stabilizing unidirectional flow, and forcing full backmixing. As the largest high-temperature, high-pressure hydrogenation reactor in the world, the reactor applied in the commercial-scale demonstration project has an internal diameter of 4.8 m and has given no indications of mineral sedimentation—even after nearly three years of operation.

High-Temperature and High-Differential Pressure Relief Valves

Increasing the resistance to wearing of high-temperature, high-differential pressure relief valves applied in DCL processes is a global problem. In the U.S., six types of relief valves were tested on a 200-t/d unit using the H-Coal DCL technology; the longest service life for the valves was 600 hours. In Japan, synthetic diamonds have been used as valve seats in a two-section throttling valve, and the longest demonstrated service life for such valves was 1008 hours on a 150-t/d DCL unit. There is a clear requirement for extremely strong materials in the DCL process; although it is strong, the flow coefficient of the valve using synthetic diamonds is far below the requirements in the industrial-scale DCL process. Other valves may have a suitable flow coefficient, but are not strong enough for long-term industrial-scale operation

Collaborating with domestic manufacturers, Shenhua Group developed a high-temperature, high-differential pressure relief valve for DCL based on the four following aspects:

  1. Research and develop appropriate pressure-relief valve structures based on hydrodynamics.
  2. Change operating parameters to reduce the solid content in the medium.
  3. Optimize control methods and increase the service life of the pressure relief valves.
  4. Develop superhard materials suitable for long-term, large-scale operation.

The longest service life of the pressure relief valve developed using Shenhua’s valve technology is 2500 hours, with more than 3000 hours of operation considered feasible based on the valve condition after disassembly.


Coking is a problem in most DCL projects. Specifically, in one project outside of China, coking has occurred in the reactors, the coal slurry reheating furnaces (especially the pressure-relief tower reheating furnace), and the high-temperature, high-pressure separator in the 100-t/d DCL unit. The coking severely affects operation. Preventing coking in the three major vessels is a global challenge. However, coking is not a problem in the Shenhua DCL project. The main factors that lead to coking were discovered through repeated tests and analysis; the impact on operation has been removed through improvement of design and operating conditions.

Increasing Equipment Capacity

Shenhua’s DCL project has incorporated numerous innovations related to the core process technology, and independent R&D is also being carried out on equipment, such as the reactors, and has led to the recognition of the equipment in the project as the most advanced globally. One example is the development of a DCL reactor with the largest capacity of any single-production line in the world. Other examples include a centrifugal pump and other core equipment that are resistant to wearing caused by solids and also can be used at high temperatures, both of which translate into sound economic benefits

Key Environmental Technologies for DCL Emission Reduction

Treatment and Conservation of Water

The typical wastewater from the Shenhua DCL project is high-concentration wastewater; its converted chemical oxygen demand (COD is a common term to determine the degree of pollution) concentration can reach 10,000 mg/L. Therefore, a wastewater processing technology was developed, starting with repeated laboratory tests. Following the laboratory tests, a full wastewater treatment process was developed; the investment in the water treatment facilities for the Shenhua DCL project to date is 890 million RMB, accounting for 7.02% of the total project investment, with the goal of near-zero wastewater discharge.

After the trial operation of the high-concentration wastewater treatment system was completed at the end of December 2008, some unanticipated problems were encountered. Shenhua Group has been vigorously pursuing solutions and improvement measures to solve the problems revealed during unit operation. After more than two years of experimental study, a comprehensive wastewater treatment technology was developed and adopted; the treatment process includes efficient catalysis oxidization, high-efficiency biological filters, ozonation, coagulation of sedimentation, membrane reactor (MBR), ultrafiltration (UF), and reverse osmosis (RO). The retrofit project to incorporate the high-concentration wastewater treatment technology has been initiated. With an investment of 450 million RMB, this wastewater treatment retrofit project has an estimated completion date of October 2013. After completion, high-concentration wastewater can be used as inlet water for a desalination processing facility, so as to change the project’s philosophy regarding the treatment of wastewater from recycling according to quality to multiuse, and thus truly realize a standard of near-zero wastewater discharge. After the advanced wastewater treatment enters into operation in late 2013, the recycling rate of wastewater will also be further improved. Water consumption as well as the quantity of intake water from the water source can be further reduced, and the ratio of tonnes of water consumed per tonne of synthetic fuels produced can be decreased to less than six.

Emissions Reduction through CCS

Large amounts of CO2 are released during the process of converting coal into synthetic fuels. The goal of carbon emissions reduction can be realized only through the treatment of the CO2. Along these lines, Shenhua Group has constructed the first carbon capture and storage test unit in Asia, through which CO2 released from the DCL hydrogen production facility is captured and then geologically sequestered through injection into a saline reservoir more than 2000 m underground. Through the first half of 2013, the cumulative quantity of CO2 injected over the life of the project was 125,352 tonnes, with each measured operating parameter superior to the design parameters. Monitoring data has been collected from one injection well and two monitoring wells and the injection demonstration has achieved the phased objectives.

Recent Progress

Since coal feeding began on 30 December 2008, the Shenhua DCL demonstration project has achieved safe, reliable, long-term operation at full production capacity through a series of technical innovations and breakthroughs as well as equipment breakthroughs and process optimization. Today, the project is making strides toward the target of operation optimization.

In 2012, the DCL unit operated for a total of 7248 hours, with synfuels output of 865,500 tonnes, and a profit and tax of 1.867 billion RMB. By the end of May 2013, the synthetic fuels output was over 400,000 tonnes. The cumulative operation time of the project had reached 302 days (the initial objective was 310 days), with a single continuous operation time of 252 days. The highest load is rate was 105% of the design value. The highest product yield was 57%, and the coal conversion rate was 91%.

The Shenhua DCL project can ultimately result in valuable economic and social benefits. The project has completely operated under market-based restrictions—raw coal is purchased at the base market rate and products are subject to market-priced sales. The price for diesel is determined according to the price guide issued by the National Development and Reform Commission, and the transfer price of petroleum and petrochemical products is approximately 500 RMB/tonne less than the market retail price. As of 30 May 2013, the DCL project has operated for a total of 22,920 hours, with a synfuels output of 2,580,000 tonnes, sold 2,530,000 tonnes of synfuels products, and paid 2.982 billion RMB in fees and taxes, with an average of 1178 RMB/tonne synfuels paid. The tax payment per tonne of synfuels of the Shenhua DCL project is much higher than that of the average coal-to-chemicals industry or petrochemical companies, thereby making a greater contribution to China’s economic growth.

Projections of the economic benefits have been made based on full-load operation and actual production and consumption indices according to product prices based on an international oil price of US$80, and the actual price level of raw materials. This analysis has shown that Shenhua’s DCL process can be economically advantageous. The plant will have an even greater profit potential through continued innovation and optimization, which could reduce raw material consumption and improve product yield.


  1. The Shenhua DCL project is the first industrial-scale demonstration project in the world based on modern DCL technology. The successful completion and operation of the project has significantly advanced the development of coal liquefaction. Validating operation through the demonstration project has made the technology more mature and has enabled China to lead the world in the application of clean coal conversion and utilization.
  2. After safe, stable, optimal, and long-term operation at full capacity, the project has successfully achieved the expected goals with favorable economic returns. Its environment-friendly operation, especially the near-zero discharge of wastewater, has played an important role in the industrial-scale demonstration project.
  3. The successful operation and completion of the project can promote the rational utilization of coal resources in western China as well as optimizing the structure for coal utilization industry. The project has importance and significance in promoting local coal processing (i.e., converting coal to synfuels near the mining site) and clean coal conversion, and in improving the value of products of coal conversion.
  4. During the implementation of the project, domestic equipment and materials have been adopted that will promote the improvement of equipment manufacturing for the modern coal-to-liquids and coal-to-chemicals industry in China, as well as the advancement of design, integration, and construction capabilities in related fields.

See article here.