1

The Technology of Methanol Production With

Mixture of
Natural Gas and Water Gas at Lantian Corporation

Li, Wan-Zhi & Geng, Jing-Tang
Henan Lantian Group Co.
68, J iefang Road, Zhumadian, Henan Province 463000. P.R.China
liwanzhi@hnlt.com.cn

Summary
The traditional raw material of methanol production is either natural gas or
water gas generated from coal. With these two kinds of raw materials, no matter what
kind of production technology is adopted, it will lead to undue H/C ratio of synthesis
gas. If natural gas is used as raw material, the content of hydrogen in the circulating
synthetic gas will be too high. On the other hand, if water gas is used, the content of
carbon will be too high. Both production technologies will lead to lower production
efficiency that wastes energy and decreases the economic benefit during production
process.
Henan Lantian Corporation, in collaboration with the First Chemical Industry
Designing Institute of State Ministry Chemical Industry, developed a new technology
that takes advantage of both processes by mixing the natural gas and water gas at the
best H/C ratio. Adopting this kind of production technology, the efficiency of
production is improved by 8-10%. In the meantime, the production cost per ton
decreases by about 10%. It has the potential to be a popular new technology for
methanol production to ensure energy efficiency and improve economic performance.
The feasibility and economy of using methanol as fuel are also discussed in
this paper.
.

1 The Technology of methanol production in Lantian Corparation
The Lantian Corporation in Henan province is a large comprehensive enterprise
including the management of piping natural gas, petroleum, chemical fertilizer,
conduit engineering, supermarket and hotel service. The company not only supplies
piping natural gas to 300 local companies and more than 50,000 users of the entire
city and suburb but also is an enterprise that successfully combines the exhaust gas
from the synthetic ammonia plant and the natural gas from the pipeline for methanol
production. It has a synthetic ammonia plant with 100,000 annual tons production
capability and co-production of 30,000 tons of methanol plant. The Lantian
Corporation supplies gasoline and Diesel fuel to all the vehicles in the city as well as
the whole sale, retail and the warehouse business of finished oils of all kinds. It is now
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the most important pillar business in Zhumadian city.

The Lantian Corporation makes full use of its special features of managing the
fuel and natural gas and combines the production equipment of the chemical fertilizer
plant together. It constructed a complete set of methanol plant with annual production
capability of 300,000 tons. The main raw material is natural gas and the second raw
material is refined water gas provided from the spared gas producing ability of the old
synthetic ammonia plant. The water, electricity, steam systems and transportation
facilities of the old plant have been sufficiently utilized.

The most advanced technique was adopted to combine with the synthetic
ammonia production. The aims are to lower energy consumption, economize
investment, increase production scale, lower cost, and increase the ability to compete
in the market.

There are five kinds of traditional natural gas steam conversion methods to
produce methanol synthetic gas:
Traditional steam conversion- one-segment method
The pressure of conversion is 1.52.5 Mpa. The value of ratio R (R=
[(H
2
-CO
2
)/(CO
2
+CO)] ) of the synthetic gas at the outlet is about 2.9. So it is
obviously in excess of hydrogen. The content of methanol at the outlet is about
3-3.5%.
One-segment method of adding CO
2

The pressure of conversion is 2.53.0 Mpa. The value of ratio R of synthetic
gas at the outlet is about 2.05 and the content of outlet methane is about 33.5%.
This method was adopted at the conversion segment of our 60,000T/year methanol
plant. When using imported advanced technique, the natural gas energy consumption
of this process amounts to 7.2 Gcal/ t methanol.
Two-segment conversion method of adding pure O
2

The outlet pressure of two segments is 2.53.0 Mpa generally. The value of R is
about 2.05 and the content of outlet methane is between 0.51%. At the same time,
air separator equipment is needed to provide pure oxygen about 300 Nm
3
/t extractive
methanol. The consumption of natural gas is lower by about 10% than traditional one
segment method.
Two-segment conversion method of adding CO
2
that combines with one
segment conversion method and the heat exchange style of conversion stove
(double one segment conversion)
The pressure of conversion is 1.5 Mpa. The value of ratio R is about 2.05. The
content of methane at the outlet is between 23%. The natural gas consumption is
lower by about 1620% than traditional one segment method.
One-segment self-heated conversion method with adding pure O
2

The pressure of conversion is 5.07.0 Mpa. The value of ratio R is about 2.05
and the content of methane is lower by 2%.This method is only used for extra giant
production plant.
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It can been seen from the above description that the first three conversion
methods are suitable for methanol production plant at medium-sized scale, but the
biggest drawback of the traditional steam conversion one-segment method is the
imbalance of the ratio H
2
/C in the methanol synthetic gas, in which the composition
of synthetic gas needs to be regulated by supplementing CO
2
to obtain the optimum
ratio of 2.05. Two-segment conversion method of adding pure O
2
can solve the
problem of imbalance of hydrogen and carbon using natural gas as raw material for
producing methanol, but this method needs to install the air separation system to
provide pure oxygen in the two-segment stoves which results in increasing investment
and electricity consumption. Our recently built methanol plant is adjacent to the
chemical fertilizer plant where excessive amount of CO
2
from the fertilizer plant can
be used to balance the H/C ratio in the new methanol plant. So, by choosing
one-segment method of adding CO
2,
we can save natural gas consumption by 16-20%.
The methanol yield can be raised by about 15% and the investment will be lower at
the same time. Because of this new methanol production technology, the Lantian
Corporation has increased considerably its ability to compete in the marketplace.

2 Developing clean methanol fuel is a necessary route that meets the special
requirements of China
Presently, about 80% of world energy supply still comes from the three types of
fossil fuel- petroleum, coal and natural gas. However, petroleum is the most
important fuel type. Although some big petroleum companies are optimistic about
the global petroleum reserves, the undisputable fact is that petroleum reserves are
limited and even the developed countries jostle to control the petroleum resources in
Middle East. Petroleum reserves appear to have become more and more important
economically and politically. Lots of experts think that if humans don't develop
alternative energy, the results will be tragic.

China is a country with relatively abundant coal deposits but lack of petroleum
and natural gas reserves per capita. The national statistic data shows that the proven
energy resources in China are: about 76510
9
t coal and 510
10
t petroleum. Although
the predicted natural reserve is 3810
12
m
3
, the proven resource is only 210
12
m
3
.
Among the world proven energy resources, coal deposits in China amount to 15%,
petroleum 2.7% and natural gas only 0.9%. As a result the energy resource structure
in China mainly relies on coal considerably in the long term. Therefore, coal
conversion into alternative fuels for automobiles should better meet the energy
demand in China.

3 Economy and feasibility analysis of clean methanol fuel
The technique of generating methanol from synthetic gas is mature. The
domestic large scale gasification plant technique from coal is increasingly perfect and
most equipment can be produced in China. The total investment of large scale
methanol production plants ( 600,000 T/A plant) has been already reduced
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significantly. To produce 1 T of methanol only about 1.5 T1.6 T of coal is needed,
Thus, in some coal rich regions in China, production cost of methanol plant can be
achieved at a very low price. The methanol production enterprises have higher profit
and good economic benefit. As an automobile fuel, the comprehensive of economy of
methanol has already had very strong competition ability. Domestically produced
methanol can now compete in the international market (the average C.I.F. price is
around 140/ T).

The price of the methanol on the market depends on supply and demand. In
recent years, it has fluctuated greatly from between 1200 RMB/ T 2400 RMB/ T.
After accomplishment of the large scale production plants, the fluctuating range of the
price will be lower. It is estimated that the price should be within the scope of 1600
RMB/ T2000RMB/ T. As long as the pace of fuel production and fuel applications
develop simultaneously, this price can be achieved.

The heat value of the methanol is only a half of gasolines. However, because
it is a kind of oxygen compound fuel, the combustion is more complete and the
energy converts more efficiently during combustion. This makes the fuel replace ratio
smaller than 2. Under the condition of different blend mixture ratios, this replace
ration will be in the range of 1.051.70. Recently, the selling price of methanol is at
2000RMB/T. Even in the M100 methanol car that has a fuel replace ratio of 1.70,
methanol fuel still is competitive to petroleum-based fuels. The benefit from low tax
for methanol production plant at this time is still very high which promotes further
development of the methanol fuel production. The development mode of the virtuous
cycle for methanol fuel would come truth.

One problem with using methanol in autos is the price of methanol-burning car
that includes an additional cost of retrofitting the vehicle for methanol fuel.
However, when using a low methanol mixture as the fuel (5%15%), there is no
need to change the engine. So, the fixed initial expenses can be negligible. If higher
proportion of methanol is used as fuel, it is necessary to change some auto parts and
the conversion fee is between 4000RMB 10000RMB. However in newly mass
produced methanol autos, the incremental expenses of each car is comparatively little,
the production factory may be willing to absorb the cost of the conversion.

Now lets look at the investment. The investment for transforming coal to oil is
22.5 times higher than that for transforming coal to alcohol (including the costs of
the auto retrofitting and building gas stations). Since some chemical fertilizer
factories also can be converted to co-produce methanol, the construction investment
of each ton equivalent finished product oil ( take the fuel replace ratio of 1.5 into
account) is only 1900RMB2000RMB.

For a methanol plant of 600,000T/year, the total investment is between
1,500,000,000RMB1,800,000,000 RMB. After the start of producing methanol, it
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would recoup the initial investments within 35 years. Therefore, its economic
performance is excellent.

Once methanol fuels develop on large scale production in China, it can
drastically reduce the pressure of importing oil and the saving of foreign currency for
other uses is worth more than the investments. Whats more, it serves as an important
function to guarantee national energy security.