China is expected to develop its coal conversion industry into the world's largest by 2020, as the world's largest coal producer and consumer is seeking clean uses of its huge coal resources, industry insiders forecast.

"China's capacity of coal liquefaction projects would hit the equivalent of 20 million tonnes of oil, that of coal-to-gas would reach 50 billion cubic meters, and coal-to-chemical totaled 10 million tonnes of oil equivalent," Du Minghua, Deputy Director of China Shenhua CTL & CTC Research Institute, said at an energy forum in Taiyuan, capital of Shanxi Province.

The scale would then become the largest in the world, while some of the technologies would be the top level in the world, he noted.

He said that so far, China has finished construction on 8 pilot clean coal conversion projects. Annual coal liquefaction capacity stands at 1.68 million tonnes, and that for coal-to-gas 15 billion cubic meters. Capacity for coal-to-olefin stands at 1.7 million tonnes, Du said.

China has large deposits of coal, but lacks oil and gas.

At present, coal is mainly used for power generation in China, which has caused severe pollution, Wang Jianguo, director of the Shanxi Institute of Coal Chemistry of Chinese Academy of Sciences, said.

"For China, coal is dominant in the energy mix, not only at present, but will be in the coming 40 to 50 years" , said Ni Weidou, academician of Chinese Academy of Engineering,

China would rely more on coal for power generation, he said, noting that clean utilization of coal would be the key for China to develop a low-carbon economy.

China should better use coal-produced liquid fuel and chemical products to make up for the shortage of oil, Wang said.

To develop the clean coal conversion sector would help China to reduce its emissions of carbon dioxide because it is easier to capture and store during the process than during direct burning. X It would help the country to meet its target of cutting the intensity of carbon dioxide emissions per unit of GDP in 2020 by 40 to 45 percent, compared with the 2005 level, experts said.

However, some experts also warned against blind investments in such projects, arguing that investment should also consider market demand.

(Xinhua News Agency September 19, 2010)