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July 1, 2010

Korean Coal Forum

Green Coal Technology

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Vision for SK Energy

“More Energy, Less CO2”

50

100

1962 ’70s

200+ α

2015 2020

Sales, billion$

Current

Oil

+ E&P, Chem, Lube, Gas

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¨̈ CoalCoal

¨ Green Coal Technology

Contents

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l Dominant Energy Source to 2030

Coal

Source: World Energy Outlook 2008

Primary Energy Demand

Unit: Billion Barrel Oil Equivalent

Source: BP, “Statistical Review of World Energy”

Energy Source

l Abundant and Accessible around the World

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l Coal has been used mainly as a boiler feedstock for electric power generation

l High CAPEX and CO2 emissions are Hurdles to use coal widely

Coal

Coal

Coal Coal CombustionCombustion

Coal Coal GasificationGasification

Syngas(CO+H2)

PowerGeneration

Syncrude

ChemicalsChemicalProcess

F-T

IGCC

Methanation SNG

Coal Utilization

FeedAvailability

CostEnviron-

mentNotNot

AffordableAffordableNotNot

CleanClean

AbundantAbundantReserves:

3 times of oil

CTL Plant CAPEX:

4 times of oil refinery

CO2 Emission of CTL Plant:

6 times of

Petroleum WTT

Energy Triangle

Hurdle to use widely

l Gasification enable coal to be used for chemical and liquid fuel production

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l CTL Plant CAPEX is 4 times of Oil Refinery and 2 times of LNG Full Value

Chain investment

Comparison for investment by energy source(Data based on Product heat value)

OilOil

LNGLNG

CoalCoal

$/MMBtu

Coal Gasification(CTL3))

Refinery1) LNG2)

10

20

30

40

10.3

20.4

40.4 1) Oil Refinery Configuration(2007US$)- 400MB/D CDU- Including VDU 190 MB/D + H/C 120 MB/D + D/C 90 MB/D- Ref.> by SK Energy

2) LNG Configuration(2005 US$)- LNG 500 million tons- Including full value chain(E/P + Liquefaction + Shipping + Vaporizing)

- Ref.> Wood Mackenzie 2005, EIA 2006

3) CTL Configuration(2006 US$)- 10,000TPD Coal Feeding- Liq. Fuel 6.5million bbl, Electric power 1,870GWh, Alcohol 11,000 tons

- Ref.> Coal to FT-Liquids and Power Supply, 2006, Fluor

5

10

15

20

(%)

* LNG Full Value Chain: Gas Field + Liquefaction & Terminal + Shipping + Terminal & Vaporizing

Coal Hurdle to use - CAPEX

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CO2 Emission of syncrude

CTL(Plant)

GTL(Plant)

PetroleumBased(WTT)

PetroleumBased(Plant)

Upstream

l NOx and SOx Reduction technology is already on the track

l CO2 emission is remained as an issue (3 mil tCO2 with 500MWnet electricity generation)

CO2 Emission by Feedstock of power generation

4 7 4

446

818

955

0

200

400

600

800

1000

1200

수력 풍력 원자력 NG발전 Fuel Oil Coal

CO2-ton/GWh

Water Wind Nuclear NaturalGas

Fuel Oil Coal

Coal

Source> Carnegie Mellon University, “Comparative Analysis of the Production Costs and Life-Cycle GHG Emissions of FT Liquid Fuels from Coal and Natural Gas” 2008

6 times of petroleum Well to Tank

Hurdle to use - CO2 emission

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l When Oil Price goes up, High Rank Coal is not likely to be cheap anymore

l Low Rank Coal has stable price and huge reserve; big potential to be utilized

Source> US EIA, World Energy Council

Historical Coal Prices

Coal

Already Occupied by Major Companies

High Rank Coal

High heating valueLittle impurity

Low Rank Coal

Not developed

yet

Low heating valueMany impurityLignite

18%

Sub-

Bituminous

32%

Bituminous

,Anthracite

50%

Proven Reserve

Accounts over 50% of world coal reserves

Low Rank Coal

0

50

100

150

2006-02 2006-07 2007-01 2007-07 2008-01 2008-07 2009-01

WTI ($/barrel)

Low Rank Coal$10~15/ton

$/ton

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¨ Coal

¨̈ Green Coal TechnologyGreen Coal Technology

Contents

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SKE Coal Utilization

l SKE is developing a innovative gasification technology (Green Coal)

Reduce CO2 emission and Capital Cost Innovatively

Development Target

Low Rank Coal

è High Moisture Content

è High Oxygen Content

è High Reactivity

è High Alkali Metal

è Low Heating Value

Feedstock

Focusing

Gasification TechnologyCoal Coal

GasificationGasificationSyngas(CO+H2)

PowerGeneration

Syncrude

ChemicalsChemicalProcess

F-T

IGCC

Methanation SNG

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Development Target

CAPEX1)

100

50

CO2 Emission

50(2013)

BEP of Crude (CTL)

US $80~100/BBL

US $55~70/BBL

Industry Leader 100

Low Rank CoalASU

&Drier

Shift&

AGR

Boundary of Target

Shift ConverterGasifier

1) Capital Cost Reduction in Gasification Block

DevelopmentPlan

2010

Pilot Construction

2013

Demo TestCompletion

2014

Commercial Plant PDP completion

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l Platform Technology(Transport Gasifier) has following advantages

How to Improve

ü Suitable to Low Rank Coal

ü Advanced Circulating Bed

ü Scalable Up to 4,000 Ton/Day with Single Train

ü Negligible Tar Formation : Carbon Conversion >98%

ü Reliable : Operating at < 980’C( <1800‘F)

ü No Spare Gasifier is Required

ü Low Cost refractory lined Carbon Steel

ü More Efficient due to Low O2 Demand

ü Low Water Consumption (no black water)

Low CAPEX

Low CO2 Emissions

Gasifier

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How to Improve

Alternative Reaction Way

EfficiencyImprovement

Drying / Gasifier / Syngas CoolingIntegration

Alt. Shift Rxn with Less CO2

X + H2O à XO + H2

Catalytic Gasification

l Carbon Capture and Storage is a geologically limited option to be applied

l SKE is rather focusing on Efficiency Improvement, Alternative Reaction

and CO2 mitigation to reduce CO2 Emission

CO2 to X

CO2 Polymer, etc

CO2 emission

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l 50% of Cost Reduction within Gasification Block

Case Cost Enabling Technologies

As Is (Industry Leader) 100% Dry Feed & Entrained Flow

1. Remove the Lock Hopper

<-11%•Slurry Feed (-11%)•Dry Solid Pump (-9%)

2. Reduce the CAPEX of pre-Dryer

<-2%•Fluidized Bed Gasifier•Cheap and Efficient Drier

3. Low Operating Temp.Gasifier with High Carbon Conversion

<-26% •Transport Reactor Gasifier

4. Remove the SyngasCooler

<-16% •Integrated Drying & Cooling

5. Air Separation Unit<-1%

<-6%

•Transport Reactor Gasifier(O2 consumption : 10% lower)•ITM(Ionic Transport Membrane)

6. Gas Clean-Up <-2% •Warm Gas Clean-up

Coal

Storage,

Drying and

Injection

14%

Coal

Gasification

and Syngas

Cooling

56%

Air

Separation

19%

Shift

Reactors

1%

Syngas

Cleanup &

Sulfur

Recovery

10%

Dry Feed-Entrained Flow

50,000 BPD CTL, North Dakota Lignite, Gasification Block

1

2

3

4

5

6

How to ImproveCAPEX

[ SKE Analysis ]

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SKE Milestone in 2010

l Developing 5 key technologies to reduce CO2 emission

l Application of key technologies to Bench(0.05T/D)

l Pilot Construction, Start-Up and Improvement

EfficientDrying

Catalyst

CO2

Utilization

SyngasShift

Activated Oxygenate

Lab ScaleLab ScaleBench

(0.05T/D)Bench

(0.05T/D)

• DTR(Drop Tube)• TBR(Thermobalance)

July 2010

Pilot Plant(3T/D)

Pilot Plant(3T/D)

Oct. 2010

• Test for element technologies.• Deduction of application for P/P.

Dec.2009

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Innovative Gasifier

유동층 (에기연) 분류층 (고기연)

•Compact Gasifier

•체류시간 2초 vs. Shell (3-5초)

•선회 흐름 vs. 직선형(Rocketdyne)

•Membrane Wall 적용

•슬래깅 특성 향상 이중 선회형

•저온 가스화기

•Partitioned Bed 방식 적용

•매체 순환 방식 조합

•전처리로 인한 개선 연구

Compactness

Plug FlowWith Swirl

(개발)

GE

Plug Flow(PWR)

신성장 스마트 프로젝트 ‘무공해석탄 가스화 기술개발’ 계획(‘09.7월~’11.1월)

주관기관: SK에너지참여기관: 에기연, 고기연 등

Transport + Catalytic (SK)

• 저온 가스화기

• 순환유동층 방식

• 짧은 체류 시간 (vs 유동층)

• 높은 고체 순환 속도

è 열/물질전달, 탄소전환율

• 저급탄 (고회분탄)에 적합

요소 기술 개발 (가스화 반응 촉진, CO2 저감)

SKE Milestone in 2010

예시) FERCO SilvaGas

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Consortium

전처리 가스화합성가스

활용

급속 건조(flash drying)

Fluidized Bed(Dual Bed)

Entrained Bed(Rocketdyne 형태)

KBR Platform+요소기술

KIST

세라믹 내화재라이닝 기술및 냉각기술

아주대

고온/고압 이중가압용기 구조해석

메탄올/DME동시 생산 설계

군산대

가스화촉매제

지자원

건조, 분쇄,회분 활용

에기연에기연 에기연에기연 고기연고기연SKSK 화연화연

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Scale-Up to >10tpd

Best요소기술

Best가스화기술

1~3 tpd Pilot

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’09 ’10 ’11 ’12 ’13 ’14 ’15 ’16

기술선정

설계 건설 운전운전 (Reliability (Reliability 검증검증 등등))

설계 건설 운전운전

SKE P/P(3 tpd, Transport)

SKE 상용플랜트

설계/건설 검증검증

운전운전

에기연 P/P(1 tpd, 유동층)

설계 건설 운전운전

요소기술 개발

설계 건설 운전운전고기연 P/P(1 tpd, 분류층)

Demo(50~100 tpd)

• 기술 채택• 자체건설 or 기존 Plant활용

자체 개발 및위탁 연구

도입도입기술기술

자체자체개발개발기술기술

스마트프로젝트1차년

설계, 건설상용Plant

상용화추진

운영Knowhow

’17

(메탄올/수소)

18

Roadmap

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Thank you for the attention!

Any Question?

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OPEN

G-200

G-AIR

SYN-GAS

G-O2 C-O2

C-200

C-AIR

C-600

G-60

FEEDER

20~100oC

900~950oC

◆ 가스화기와 Recycled Syngas의온도차

Ø 가스화기: 900~950oC

Ø Recycled Syngas: 20~100oC

◆ 목 적

Ø 상용모사기를 통하여,Recycled Syngas 온도가 가스화기에 미치는 영향을 살펴보고자함

Plant Engineering Center, IAE

3.1 분류층 석탄 가스화기 개념 설계 :4) 개념 설계 요약(2) : 개념설계 결과물(일부)

가스화기주요 성 미분탄 공급 노 개념도

이 가압용기 개념도 급냉 용기개념도