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Page added on November 29, 2006

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A new kind of energy for China

…”Beijing Sets National Standard for Methanol as Automotive Fuel,” stated the well- regarded, if salmon-tinted newspaper. Methanol? Yes, good old “wood alcohol.” This is the stuff that if you drink it, will make you blind. But this particular label of Chinese methanol is not and will not be somebody’s moonshine. Instead, this Chinese methanol will be derived from coal in the so-called “Fischer-Tropsch” chemical process, which leads to an industrial method described as “coal-to-liquid” (CTL). Added to gasoline, coal-derived methanol creates a cleaner-burning type of fuel. And at oil prices above about $35 per barrel, methanol is very much a cost-competitive option for automotive fuel. Very clever, those Chinese. Here are a few of the key paragraphs from the Financial Times report:

Beijing has settled on a national standard for methanol as an automotive fuel, a decision which will legitimize and bolster a market that has been growing rapidly without central government approval. The standard, which has yet to be officially announced, was reported in a trade magazine and confirmed yesterday by an official attached to the National Development and Reform Commission (NDRC), the economic planning body responsible for the standards.

Local companies have under construction, or are awaiting approval to build, plants to produce methanol equivalent to about 20% of China’s present oil consumption…By the time the plants, which convert coal to liquids, start producing in 2011-2013, China’s oil demand will have doubled, allowing methanol to supply about 10% of the market.

Energy Bulletin

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