Pakistan will produce gas and diesel from Thar coal

ISLAMABAD: The government has geared up the process on two projects for turning Thar coal into gas and diesel and in is contact with two Chinese companies -- China Ghazuba and China Coal, Special Assistant on Coordination of Marketing & Development of Mineral Resources Shahzad Syed Qasim disclosed this to The News on Monday.

"We want to initiate two projects; one on Coal to Gas (CTG) and the other one on Coal to Liquid (CTL) and to this effect we have asked Engro Fertilizer, Fauji Fertilizer and Fatima Fertilizer to initiate the feasibility study collectively on turning the Thar coal into synthetic gas and then equal to natural gas. The three players want to use the synthetic gas as fuel for production of fertilizer."

He said that the local gas reserves were fast depleting and the cost of RLNG, the imported product, was too high that hovers around $9-10 per MMBTU on an average. If the said projects are materialized, then it will be no less than a game changer.

“Earlier, the three said companies had separately conducted feasibility studies on turning Thar coal into synthetic gas, but they found that it would cost them at a higher side. Now we have again asked them to collectively initiate the feasibility study on the proposed project and we are hopeful this time the result will be positive.” The government will also initiate the project to turn the Thar coal into diesel (liquid).

Qasim said that 75 percent fertilizer was produced in China through synthetic gas as fuel produced from the coal reserves. He also mentioned that according to the standard conversion rates, the Thar Lignite Coal resources are equivalent to around 50 billion tons of oil, which is more than the combined oil resources of Saudi Arabia and Iran. In terms of gas reserves, these are around 68 times the present resources of natural gas in Pakistan.

It is pertinent to mention that Shenhua Ningxia Coal Industry Group, a subsidiary of China’s biggest coal producer, the Shenhua Group, has already successfully installed the project to convert coal into oil in the northwestern Chinese region of Ningxia, the biggest plant of its kind in the world.

The coal-to-liquid (CTL) project, which has an annual production capacity of 4 million tons of oil, was built by the Shenhua Ningxia Coal Industry Group, a subsidiary of China’s biggest coal producer, the Shenhua Group.

Pakistan’s monthly diesel requirement stands at an average 600,000 tonnes according to which annual need stands at 7.2 million tons and the project to make Thar coal liquid (diesel) will also help reduce the import bill of diesel.

The SAPM on mineral development said that the government has planned not to increase the power generation of more than 10,000 MW through Thar coal because of the global warming phenomena, but will increase its focus on power generation through renewable resources as well as hydro generation. He disclosed the Lucky Power Plant of 660MW is being installed at Port Qasim, which will utilize the Thar coal and to this effect a railway line will be laid down from Thar coalfield to New Chhore from where it will be connected to the railway station line that will take Thar coal to Port Qasim. He also disclosed that the railway line of 105 kilometers will be laid down by the private sector on BOT (build, operate and transfer) basis. Similarly the second power plant of 660MW based on Thar coal is being installed at Jamshoro.