Rising and Floating of Lignite in Eastern Mongolia

The lignite project which has been stranded for many years is still standing on the prairie. People who have witnessed the ups and downs of the lignite industry hope that they will not be lost in the new industrial cycle and market changes. The vast grassland in northern Xinjiang and Inner Mongolia witnesses the ups and downs of the coal industry because of the rich coal resources buried underground. In Eastern Inner Mongolia, many people still remember the scene of crazy investment in lignite.

Lignite is the lowest calorific coal, rich in moisture, and unsuitable for long-distance transportation. The Eastern Inner Mongolia accounts for almost 70% of China's 300 billion tons of lignite reserves. During the industrial boom of the past ten years, the central enterprises, including the five major power generation groups, and all kinds of capital poured into this area fiercely. They enclosed land crazily and hoarded resources.

But the prosperity is not long. Due to the technical difficulties of lignite upgrading process and the actual impediment of Inner Mongolia's own power consumption, the lignite projects invested enormously by the local government are declining day by day. Almost all the stakeholders involved in these projects are in a dilemma, and the factories invested heavily before have become desolate.

Nowadays, the fluctuation of industrial cycle and the rise of coal price seem to give lignite industry new vitality. For the eastern part of Mongolia, this means that the once silent important economic pillar is back on track. In the eyes of local officials, lignite has become a fragrant baboon.

"Lignite is now profitable as long as it is digged out." An official of the Ximeng Energy Bureau told Energy. It is obvious that compared with the radical development wave ten years ago, the overall planning of lignite industry in eastern Mongolia has become more rational and restrained, and the local authorities have found a more accurate industrial positioning for lignite. In addition to meeting the local demand of Eastern Mongolia, it also supplies the coal gap in the adjacent northeast, as well as the coal demand of new power points for UHV long distance transmission. But even so, how to maximize the economic value of lignite and how to realize the efficient utilization of lignite in the long-term dimension of industrial development are still difficult issues for all stakeholders.

The source of the wave

The autumn meaning of Xilinhot became stronger and stronger in late August. Two 660 MW generating units of Datang International Xilinhot Power Plant entered the final trial operation stage. Datang Xilinhot Power Plant is one of the seven power supply points for the UHV transmission channel from Ximeng to Shandong Province. It has entered the trial operation stage, which means that a new power supply point will be added to the UHV project from Ximeng to Shandong.

Xilinhot Power Plant is a pithead power plant, relying on the coal mine is the famous Shengli Coalfield East No.2 Coal Mine in Dingding. With this power plant and the coal-to-olefin project in Duolun, Datang International has obtained the mining right of Shengli East No. 2 Coal Mine, which has abundant reserves.

In fact, the time went back to 10 years ago, Dong2 Coal Mine of Shengli Coalfield was a sign of the development tide of lignite in eastern Mongolia.

There are huge reserves of lignite buried under the surface of five league cities in eastern Inner Mongolia. Dong2 Coal Mine of Shengli Coalfield is one of the most abundant coal mines, with a capacity of 10 million tons per year built in 2009.

Shengli Coalfield East No.2 Coal Mine is also the core of Datang Group's diversification strategy. Focusing on this coal mine with great potential, Datang Group has planned power plants, coal-to-olefin and subsequent coal-to-gas projects.

Sino-New Energy Technologies Co., Ltd. is a platform for centralized management of coal conversion projects under Datang Group. After introducing new investors in 2017, it was owned by Datang Group by 35%. A senior executive of Sinopec Energy recalled to Energy that Datang Group promised to invest in supporting power plants and coal-to-olefin projects in eastern Mongolia, thereby winning the right to exploit Dong2 Coal Mine in Shengli Coalfield. Since then, the internal planning of Datang Group has also been made by Dong2 Coal Mine for the coal supply project of Keshketeng Banner, which was later invested by Dong2 Coal Mine.

Enterprises in Inner Mongolia to obtain coal resources, in-situ conversion project is an irrevocable threshold. As early as during the Eleventh Five-Year Plan period, the Inner Mongolia Autonomous Region Government made it clear that it should make use of abundant coal resources to promote the development of local industry, and incline to in-situ deep transformation and processing in coal allocation.

In 2004, Inner Mongolia issued "Opinions on Further Strengthening the Management of Resources Allocation of Coal Resources Mining Rights and Key Conversion Projects", requiring the establishment of mining rights in coal-rich areas to focus on coal chemical industry, coal liquefaction and coal electrification invested in autonomous areas, whether in proven or still in need of proven mining areas. Large projects incline.

The Opinion requires that enterprises that have obtained coal resources allocation and coal production qualifications must achieve more than 50% in-situ conversion in the region. At the end of last century, the coal price was low and the benefit of electric power enterprises was very good. At the beginning of the new century, electric power enterprises had abundant funds on hand. Considering the requirement of "bigger and stronger" state-owned enterprises, diversification became the convergent choice. The executive said.

Datang Group is one of the five major power central enterprises in China. It is a logical choice to extend to the upstream. Combining with the local transformation policy of Inner Mongolia, Datang has constructed a diversified strategic system of coal resources and various coal conversion projects in Dong2 Coal Mine of Shengli Coalfield. Since 2002, the coal industry has been through the cold winter. Due to the sustained and strong growth of energy demand downstream, the coal supply is gradually in short supply, and the coal price has been rising all the way.