“Building a mega plant is always a challenge”: Thyssen Krupp

ThyssenKrupp Uhde, a subsidiary of ThyssenKrupp, is one of the world’s leading engineering companies. Uhde is a global leader in CTL technology and is to build a coal-to-liquid plant in cooperation with Industrial Corporation Mongolia LLC. As he answers some questions from MMJ, Claudio Marsico, Director of Sales, ThyssenKrupp, says his company can offer Mongolia much more than the plant whose construction should begin in a month or two.

Is Mongolian coal different in any major way from German and Polish coal with which you are more familiar?

We started assessing the possibility of building a coal-to-liquid plant in Mongolia way back in 2007 and understanding the properties of the coal was most important. We have found the coal here to be suitable for conversion into a synthetic liquid fuel akin to diesel or gasoline.
What we do is to use different varieties of fit-stops which we first convert in our gasifier into raw syngas. This is then purified and made into final products such as diesel, gasoline, and other chemicals like ammonia or hydrogen which are used in a variety of manufacturing processes.

For how long has ThyssenKrupp used the coal-to-liquid(CTL) technology?

We are in the gasification business since 1941. So we have more than 70 years of experience of converting coal into a final product such as diesel or gasoline. Coal-to-liquid is just one option. We have built a plant in Spain to convert coal into power. The basic technology is always the same, but some adjustments are needed depending on what the final product is.

What is the present status of the plant your subsidiary Uhde is to build here in partnership with ICM, a Mongolian company?

These are really mega projects and they take years to be implemented. Work goes on in phases, starting with feasibility studies. In the present case, these are done. The next step is to identify the gasification technology most appropriate to the final product demanded. The basic engineering construction should begin around the end of June or beginning of July.

What are the main challenges in the present job?

Building a mega plant is always a challenge, no matter where we are in the world --Africa,the USA, or Mongolia. It is very important to understand the specifics of the work area. For example, there can be no round-the-year construction here, and we have to develop the bestway to utilize the available time as fruitfully as possible. Logistics is the other challenge here, as it is not easy to bring all equipment to the site.

Tell us something of your experience from around the world.

At the moment we are setting up a coal-to-liquid plant in Mozambique and a transgas project in West Virginia, USA, apart from coal-to-power projects in Europe that we have been building for many years. We convert not only coal but also have biomass based projects that have mainly chemical final products.

The memorandum on thermal coal projects was signed during the Mongolian President’s recent visit to Germany. How was this special?

First, it indicated how important this coal-to-liquid project is for Mongolia, and also that there is political agreement and a strong desire to move forward with the project. If you recall, last year the German Chancellor was here and signed agreements with the Mongolian Government. Then when the Mongolian President visited Germany, we took the opportunity to sign the final agreements with the Mongolian Government for implementation of this project. We have also signed licence agreements with the private sector. Both the political and the industrial sides have been very supportive to see the plant come up.

Is CTL technology viable both technically and economically?

It has to be, otherwise why should there be investment in such plants? Oil and gas prices are increasing, but global coal price continues to be stable. CTL plants make more sense in countries that have their own coal or at least have easy access to coal that can be converted into some final product.

Can Mongolia meet its gas needs from plants using its coal?

The size of the plant is very important for its commercial viability. Generally, a small plant is not cost effective. Our experience has been that a production capacity of 18,000 barrels a day makes economic sense. Units of a similar capacity can of course be added after some time. At present Mongolia imports 1 million tons of diesel a year. Plants of the aforementioned capacity would cover 2/3 of the demand. But, yes, demand in Mongolia will increase in the near future, so maybe you will need two or three plants within the next decade.

ThyssenKrupp can offer Mongolia much more than this CTL plant. For example, we build cement plants. Our subsidiary ThyssenKrupp Uhdeis already holding talks on setting up a coal coking project in Mongolia. We see a clear need for Mongolia to begin manufacturing steel or at least to produce coked coal to supply the steel industry worldwide.