On August 25, 2004, the world's largest coal-to-oil project, the Shenhua Group’s coal direct liquefaction initiative, officially commenced in Erdos, Inner Mongolia. This groundbreaking facility is the first industrial-scale project globally to directly convert coal into liquid fuel. Once fully operational, it will serve as the world's first commercial demonstration unit for coal direct liquefaction, marking a major milestone in energy technology.
The project is designed to produce 5 million tons of oil products annually, with construction divided into two phases. The first phase alone required an investment of 24.5 billion yuan, consuming 9.7 million tons of coal each year and producing 3.2 million tons of various petroleum products. This includes 500,000 tons of gasoline, 2.15 million tons of diesel, 310,000 tons of liquefied petroleum gas, along with benzene, mixed xylene, and 240,000 tons of other byproducts. The first production line was completed in July 2007, with the second expected to be finished around 2010.
In comparison, the U.S. coal-to-oil plant currently under construction uses indirect liquefaction technology and produces about 5,000 barrels of oil per day. In contrast, the Shenhua project is set to generate nearly 10,000 barrels daily, making it the largest coal-to-oil demonstration plant in the world today.
With global oil prices on the rise, this project has gained significant attention. It represents not only a technological advancement but also a strategic move to enhance energy security and reduce reliance on imported crude oil. As the project moves forward, it continues to attract interest from both domestic and international stakeholders, highlighting its importance in the evolving energy landscape.
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