Sasol and Shenhua have agreed to focus full attention on the Ningxia Hui Coal to Liquids (CTL) feasibility study.

The joint venture between Shenhua Ningxia Coal Group and Sasol in the Ningxia Hui Autonomous Region is one of the two CTL projects which will continue with further study and development in China. This strategy aligns with a recent notice issued by the National Development and Reform Commission of the Peoples Republic of China.

The proposed site in the Ningdong Chemical and Energy base has excellent infrastructure. A significant amount of work has been completed in preparing the physical site, providing the platform for potential future expansion. The significant advantages of this approach were demonstrated at Secunda in South Africa during the phased construction of the Sasol Two and Sasol Three projects.

Pat Davies, Chief Executive of Sasol said $quot;I believe that it is the right decision to focus all our attention and resources on ensuring the planning and construction of a world scale 80 000 barrel per day, fully integrated CTL plant in the Ningxia Hui Autonomous Region. Sasol is delighted to be a full partner in the integrated CTL project, to bring its world leading proprietary technology and proven commercial CTL experience to China to produce high quality environmentally friendly fuels and to add significant value to both the Chinese economy and Sasol$quot;.

CTL technology dates back to the 1920’s and involves converting coal into gas and then using it to make synthetic fuel, a process requiring large amounts of oxygen.
Many companies explored the process but as oil was cheaper, the technology was pushed to one side. Sasol was an exception and became the world’s leading purveyor of coal-to-liquids technology. CTL and GTL (Gas-to-liquids) are currently enjoying somewhat of a resurge in response to continually rising oil prices.