Gasification – Key to Energy Security

Overview

The recent crisis of escalating crude oil prices emanating out of the war in Ukraine has once again established the vulnerability of fossil fuel importing countries such as India.?With sky rocketing prices of distillates all round pressure is being felt on the economy.?It is unfortunate, that in times when the prices of crude are somewhat moderate, appropriate steps are not taken to insulate the country at least partially of this grave situation. The fact is, that this is not of ignorance, but generally tentative decision making, which holds us back. Every country in some form or the other has to evolve a protective shield around itself, particularly if that country happens to be a largely energy importing country.

Way back in 2015-16 considerable work was done with respect to valorization of Indian coal blended with pet coke, to produce chemicals and distillates. While major detailed feasibility reports were performed for the Adani group only one project at Talcher matured to produce Fertilizer and synthetic gas. One of the ideal scenario in which gasification process can be utilized is to produce urea, methanol, ethanol and sulfuric acid through the gasification of coal or a blend of Coal+ Pet-coke. This will not only secure the raw material through its indigenous availability, but also generate valuable blending fuels such as methanol, ethanol and DME through which the gasoline and diesel could be enhanced. An alternative could be to cap the production of gasoline and displace naphtha to find way into production of petrochemicals for higher value-add. A lot of papers with economics were provided to Government of India/Niti Aayog, however, it is only now that some movement on gasification is taking place.

It is understood that EVs, Green Hydrogen, Bio fuels all have a significant role to play to enhance the energy basket of the country, however, it is the economies of scale which is important as well for a country as diversified as India. Utilization of domestic coal for production of distillates and chemicals in this connection achieves significance, as with this not only the import of fossil fuels would be reduced but considerable amount of energy security could be provided to the country.

One of the proven paths of distillate maximization through coal/coke gasification is through production of methanol. Once methanol is produced, its conversion into DME can lead to production of blenders for LPG and diesel.

Since the country is blessed with significant reserves of coal, it is important that gasification as a key technology must be prioritized. Similar to the priority accorded by the Hon’ble Prime Minister for green hydrogen it is important that a similar announcement perhaps should be made to provide emphasis on gasification to support energy security for the country. Since vast quantities of coal are available in the belt between Madhya Pradesh, Orissa, Jharkhand, West Bengal and part of Maharashtra, there is good reason to believe that several coal gasification complexes could be foreseen.

It is a known fact, that India has been bestowed with lot of coal, but unfortunately the quality of coal is not as good, except in certain pockets. Most of the coal is laden with high ash which makes it a technological challenge for gasification. This possibly can be overcome substantially, by blending the Coal with Pet-coke to try and bring the average ash content below 30% for making it favorable for gasification process. Hitherto, most of the Pet-coke being produced from the Refineries in India is being routed to cement kilns. However, while this movement has been an option, obviously it is fraught with environmental hazards as pet coke laden with high quantum of sulphur and metals could find way into the environment unless the cement plants are equipped with desulphurization facilities.

Another option for disposal of the pet coke could be to blend pet coke with coal for utilization as fuel in the utility power plants. While studies have revealed that up to 8% of pet coke can be blended into coal and utilized as fuel in utility power plants without change of hardware in the same, the problem of sulfur finding way into the environment remains an issue. Significant FGD capacities located at the tail end of the utility power plants need to be set up to capture sulfur in carbonate solutions leading to production of gypsum. All these are environment projects and while they are necessary, they will invite significant cost penalty to the Power Plants without significant value addition.

?Proposition?

Considering a 20 MMTPA refinery in a region where coal would be available, Delayed Coker would be a useful technology to be included in the refinery configuration not only to generate distillates from petroleum residues but also lead to reduced capex of the refinery. The Delayed Coker however, will lead to generation of pet coke which could be usefully utilized as a blender to domestic coal before for finding way into the gasification plant as slurry.

Pet coke blended with domestic coal even with higher ash content up to 40 or 42% can generate a blend with an average ash content of less than 30% which could be usefully processed in the Gasifiers. Since the facility is proposed to produce chemicals, it would be advisable to consider high pressure Gasifiers of higher capacities, up to 900 cft with pressure ranging above 80 bar.?Oxygen could be produced in the Air Separation plant for utilization of the same in the gasification process for generation of syn gas. The gasifiers can be designed considering water quench technology with the intention of maximization of production of raw syn gas. The slag along with water could be processed to separate the slag and recycle the water back to the process. Slag could find way into infrastructure industry such as cement, road, buildings etc.

Raw syn gas produced from the gasifier at higher pressures could be routed to the acid removal section, where through usage of solvents acid gases could be removed from the raw Syn gas to recover clean syn gas. Acid gases rich in sulfur could be utilized to produce raw sulfur. Alternatively sulfuric acid which can be utilized in phosphate fertilizer plants could be considered. The advantage of sulfuric acid plant is that it incidentally, produces a lot of steam which can be used in the process plant.

Clean syn gas from the Acid Gas removal facility could be routed to the shift reactors, wherein hydrogen production could be maximized at the expense of CO.?Considerable quantities of CO2 would be produced in the process.?The CO2 could be recovered through utilization of solvents. The CO2 so recovered could be compressed and routed to the ammonia/urea complex as well as to the methanol complex.

The syn gas after removal of CO2 could be routed to the PSA for recovery of H2 to be routed to the Ammonia section of the Urea complex, where it could be combined with Nitrogen from the Air separation plant to produce ammonia. The syn gas produced after CO2 removal could be segregated into two streams one being routed to PSA plant production of Hydrogen, and the other could be routed to the Methanol Plant for production of Methanol.?

The complex would be designed such that no CO2 would be emitted t atmosphere and the entire CO2 production would be captively consumed and sequestered within the complex itself. This will make the plant extremely environmental friendly.?Both the sulfuric acid production as well as internal consumption of CO2 could ensure negligible sulfur and CO2 emissions making the gasification complex environment friendly.

?Project

Given the fact that large scale production of Urea and Methanol would be ensured in the complex, the gasification facility has to be large to suit economies of scale and production of urea/ methanol in large quantum for justification of the investment. For typical gasification complex to be justified, a world scale Ammonia Urea Complex producing 3850 TPD of urea and methanol complex of about 5000 TPD would as a minimum be necessary to justify the scale. Additionally considerable quantity of ethanol could also be produced from the PSA tail gases along with sulfuric acid.

The typical composition of syn gas would be:

From the above, it may be noted that Coal has a higher pre-dominance of CO2 with respect to coke. The Syn gas from the pet coke has a higher pre-dominance of H2 and CO.

The coal based syn gas indicates a higher quantum of H2 and significantly lower quantum of CO2 with reasonable quantum of CO.?On the contrary post shift coke based syn gas has much lesser CO2, significant quantum of CO and moderate to high quantum of H2. The H2 quantum can be maximized to as high as 91% considering that CH4 production as part of coke gasification can also be reformed.

?Project Configuration

Based on the prima-facie calculations 1.3 MMTPA of coke and 8.6 MM of coal i.e. close to 10 MMT of blend of coal + coke would be required to produce 3850 TPD of urea and 5000 TPD of methanol.?The ethanol and sulfuric acid would also be produced in considerable quantities as by-products. This implies that 1.65 MMTPA of Methanol and 1.27 MMTPA of urea would be produced from the complex along significant quantum of ethanol and sulfuric acid.?

The entire methanol and ethanol could be blended into the gasoline pool to either boost the total quantum of produce from the complex or a part of the methanol could be converted to DME, for blending into LPG or the diesel pool.?Either way this flexibility can be exercised, and crude import commensurate with the same can be reduced. Similarly about 2.2 to 2.4 MMSCMD of natural gas is required to support a Ammonia/Urea Complex of 3850 TPD capacity.?This natural gas import would be eliminated as the urea would straightway be produced to gasification of pet coke + Coal. This will lead to considerable saving of foreign exchange, besides reducing the pressure on the hydrocarbon import bills to serve the fertilizer industry.

Incidentally the gas price is a pass through cost in the Fertilizer Industry, which adds to considerable subsidy burden for the Government.?All these could be regulated in the process. . The central and most significant point is that the cost of production of fertilizer through the coal + Pet coke would be considerably lesser as compared to the urea produced via natural gas. Overall it would be a tremendous win-win for the Government. Assuming that 10 such plants could be conceived to be set up in the next 5-6 years, one can immediately look into massive benefits that would accrue to the country.

Economics

Considering the urea import price of 500 $/Ton and methanol also as 500 $/T power at Rs.4.6/unit and coal as Rs.2000/T and pet coke as Rs.1200/Ton a brief economics has been carried out for the complex and the following have been deduced:

The capex for the facility could range between 15,000 to 20,000 crores ($ 2-3 billion) implying therefore, that the pay back would be between 3 to 3.5 years. Even if the Operating revenue is less by 15% the payback period would be well within 4 years. These plants have scale and volume and are clearly justified from energy security point of view. This would help in substantially reducing the fossil fuel import and gradually enable an environment in which the country could be largely insulated from fossil fuel price volatility in partnership with other energy supplementing sources such as green hydrogen, bio fuels and EVs. As a long term vision at least 50% of the total energy requirements perhaps, could be secured through a combination of all these important basket of technologies.

Strategy

It is natural that such a massive gasification complex would require partnership from important stake holders in the country. Participation of Gasification Company, a Fertilizer Company as well an OMC would be almost essential for overall synergies to be established. Another possibility of securing the gasification complex could be to consider the gasification block under BOO to be awarded to an international premier like Air Products etc who have complete basket of technologies for gasification. All the other complex facilities could be set up domestically through maximization of domestic content of Plant and Machinery. It is worthy of notice, that most of the plant and machinery in the complex can be domestically sourced, as a very high degree of manufacturing capability to support the refining and petrochemical sector has already been achieved in the country. This will reduce Capex and improve the GRMs for overall gain.

Gasification on a large scale, is perhaps one of the important step forward and possibly a consortium of companies and vendors to form a National vision towards this important cause cannot be delayed any longer. It is good that the Hon’ble Finance Minister has already announced a 100 MT gasification target by 2030. ?It would be prudent to have some gasification plants conceived along some of the suggested lines mentioned above.