Gasification Gamechanger for Chemicals

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Gasification – Gamechanger for Chemicals

GASIFICATION INDIA 2020

Shiba Sen & Mario Moniz

December 16, 2020

©2020 Air Products & Chemical Inc

Coal to Chemicals can save significant foreign exchange

India’s domestic coal use as a feedstock for chemicals like methanol/ammonia and fuels can reduce the country’s foreign exchange spend for oil and gas by ~10-15 billion USD in the next 5 years

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Overview of India’s Energy Mix by Fuel and Sector

TPES – Total Primary Energy Supply | TFC – Total Final Consumption | Date of Year 2017 All figures in Million Tonnes of Oil Equivalent (Mtoe)

• India is heavily dependent on crude oil and LNG imports with ~84% import

dependence for crude oil and ~46% for natural gas/LNG

• India’s net foreign exchange outgo was ~112 billion US$ on account of crude

oil imports and ~10.3 billion USD for LNG imports in the financial year 2018–19

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Coal/Petcoke preparation and supply

Utilities : Power , Water, etc.

Land, Clearances & Permits

Sulphur

Air Products Gasifiers

Slag / Black / Grey Water

Syngas Clean-Up

Gas Separation

AirSeparationUnit

Air Products – Business Model

Customer Investment

Gamechanger opportunity – Air Products Model

Ammonia

Methanol

Syngas

SyntheticFuels

Hydrogen /CO

Air Products Investment ( Build , Own and Operate)

CO₂ Capture

Air Products Build, Own & Operate for long term ( 20-25 years) End Products

supply contract (e.g. Methanol, Ammonia , Hydrogen, Carbon Monoxide, SNG,

Synthetic Fuels and Power)

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Air Products experience for this Gamechanging opportunity in India

Project capital represents 100%, not APD shareProject dates represent actual or expected onstream

Lu’AnJV$1.5B2018Large ASUs

for China coal gasification

Jiutai100% APD$0.65B2022Jazan IG/

Gasif/Power JV$11.5B 2021

DebangJV$0.25B2023

Indonesia100% APD$2B2024

Gasification plants are CO2 capture ready

Shell Gasification Technology Acquisition(May 2018)

GE Gasification Technology Announcement(November 2018)

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Saudi Aramco Jazan Economic City,Saudi Arabia

● Scope: Long-term supply of hydrogen, nitrogen, steam and electricity from gasification of vacuum residue. Air Products process includes:– ~3.8 GW IGCC– Six ASUs producing >75,000 tpd of oxygen and nitrogen– Utilities

● Customer End Products: Refined oil products

● Ownership: JV between Air Products (46%), ACWA Power (25%), Saudi Aramco (20%) and Air Products Qudra, a majority-owned JV with Qudra Energy (9%)

● Capital: ~$11.5 billion

● Contract: Customer pays fixed monthly fee and provides vacuum residue

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Lu'An Clean Energy Company Changzhi, Shanxi Province, China

• Scope: Long-term supply of syngas from coal gasification. Air Products process includes:

• Four 3,000 ton-per-day (tpd) dry- feed gasifiers with syngas coolers, the largest single dry-feed gasifiers at the time of being put into operation

• Syngas clean-up system• Four air separation units (ASU) producing >16,000

tpd of oxygen and nitrogen• Customer End Products: 1 mmpta coal to liquid fuels - one of China's landmark clean energy demonstration projects• Ownership: Joint venture (JV) between Air Products (60%) and Lu'An (40%)• Capital: $1.3 billion• Contract: Customer pays fixed monthly fee and provides coal• Status: Onstream

Other:• The gasifiers have delivered outstanding performance in syngas output, carbon conversion

rate and operational efficiency.• Gasifiers ramped up quickly with a consecutive running record of 212 days for a single

gasifier realized within one year of start-up. Nearly 95% of plant availability rate was achieved in 2019.

• Carbon conversion rate of >99% was delivered in 2019 for high ash anthracite as feed

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PT Bakrie Capital and PT Ithaca Resources Bengalon, East Kalimantan, Indonesia

• Scope: Long-term supply of nearly 2 million

tpy of methanol.

Air Products process includes:

– Air separation

– Air Products' proprietary Syngas Solutions™

dry-feed gasifier (6 million TPY of coal)

– Syngas clean-up

– Methanol plant

– Utility island

• Capital: ~$2 billion; 100% Air Products

• Contract: Customer pays fixed monthly fee

• Status: Onstream expected 2024

Highest Moisture coalHighest Moisture coal

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Jiutai New Material Co. Ltd Hohhot, China

• Scope: Long-term supply of about 500,000

nm3/hour of syngas.


– Two 2,000 tpd Air Products dry-feed gasifiers,

converting lignite into syngas efficiently

– Two ~100,000 nm3/hour ASUs

– Syngas purification and processing

– Associated infrastructure and utilities

• Customer End Products: 1 mmtpa MEG -

the largest single plant of its size

• Ownership: Air Products (100%)

• Capital: $650 million

• Contract: Customer pays fixed monthly fee


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Debang Group, Lianyungang City,Jiangsu Province, China

• Scope: Long-term supply of about 500,000

nm3/hour of syngas.


– Two 750 tpd slurry gasifiers

– Purification units

– ASUs

• Customer End Products: 350,000 tons

per year (tpy) of chemicals

• Ownership: JV between Air Products

(80%) and Debang Group (20%)

• Capital: ~$250 million

• Contract: Customer pays fixed monthly

fee


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Air Products’ technology presence in IndiaUtilizing domestic coals for a range of products

Approx shipping distance of 500 KM

◼ Client: Coal India Limited

◼ Location: Dankuni coal complex

◼ 25 Kms from city of Kolkata (Calcutta)

◼ 2050 t/d Methanol

◼ Coal from Raniganj Coalfields

◼ Ash content less than 24%

◼ 25 years BOO contract

◼ Currently project is in Bidding phase

◼ AP to offer dry-feed technology

◼ Located at Orissa, India

◼ EPC contract awarded in September 2019

◼ Final products are 2200 tpd ammonia, and 3850 tpd urea

◼ Air Products dry-feed coal gasification selected, for gasifying a blend of high-ash coal (ranging from 40% to 47% ash) and petcoke (25% maximum in the blend)

New project: Talcher fertilizers limited high-ash coal gasification

New project: Dankuni Coal to Methanol Project

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What is Build-Own-Operate /Sale of Gas/ Outsourcing

• Under the Sale of Equipment (SOE) model, the customer produces its own industrial

gases. They buy a design license, pay other parties to build the plant & then operate

and maintain the plant themselves

• In SOE, customer invests in the capex and takes all risks related to construction and

operations/maintenance

• Under the Build-Own-Operate (BOO)/ Sale of Gas (SOG) case, the customer buys

industrial gas or the product (chemicals) from the BOO supplier, the BOO supplier;

- Provides capital to design & build the plant and then owns and operates the facility

and supplies the product to the customer over a long term contract

- Takes full responsibility for all operating and maintenance activities and risks

- Provides guaranteed on-stream (reliability & availability) and process/energy

efficiency levels

- May supply multiple customers from a single plant

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©2020 Air Products & Chemical Inc13

Coal/Petcoke preparation and supply

Utilities : Power , Water, etc.

Land, Clearances & Permits

Sulphur

Air Products Gasifiers

Slag / Black / Grey Water

Syngas Clean-Up

Gas Separation

AirSeparationUnit

Air Products – Business Model

Customer Investment

Gamechanger opportunity – Air Products Model

Ammonia

Methanol

Syngas

SyntheticFuels

Hydrogen /CO

Air Products Investment ( Build , Own and Operate)

CO₂ Capture

Air Products Build, Own & Operate for long term ( 20-25 years) End Products

supply contract (e.g. Methanol, Ammonia , Hydrogen, Carbon Monoxide, SNG,

Synthetic Fuels and Power)


Risk Matrix Comparison

Customer Make Case Air Products Supply

Risk Category Customer Customer Air Products

Construction - Cost X X

Construction -Schedule

X X

Commissioning X X

Feedstock X X

Operating - Availability X X

Operating – Efficiency X X

Operating – Costs X X

Funding X X

Sale of Gas / BOO model transfers most risks from Customer to Air Products

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Supply Structure: Coal to Methanol

Any Govt. Entity or PSU

Gasification Units

End Markets

Prepared Coal

Methanol

ASU Units

Syngas Purification

O2

Crude Syngas

NH3/MeOH Production

Guaranteed off-take of Methanol or Ammonia

Ammonia



End Markets



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Air Products will invest, own and operate the coal to chemicals facility and guarantee plant

performance backed by significant financial incentives and penalties if targets are not achieved

• Complete capital avoidance – Air Products to invest the capital

• Guaranteed by Air Products

- Availability - % on-stream

- Reliability - trips / year

- Plant efficiency

- Product specification

- Operational cost

- Build schedule & cost

Benefits of BOO Model

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• 100% owned facility in Kochi

• BPCL Kochi awarded this

BOO contract in year 2013

based on competitive

bidding

• Build, Own and Operate

(BOO) Model implemented

to supply Hydrogen,

Syngas and Nitrogen to

BPCL Kochi

• 18 MW captive gas turbine

is part of BOO scope

• Investment of ~$500

Million

• In operation for more than

3 years

BOO Facility at BPCL Kochi, Kerala, India

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Thank you tell me more

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Air Products India

Industrial gas facility in Kochi supplying BPCL

EPC Center in Pune

EPC Center in Vadodara

INOX Air Products JV-

largest IG company in India

Global, multibillion-dollar industrial gases company with extensive operations in India

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Gasification Gamechanger for Chemicals