Air Products to Supply Coals-to-Chemical Project

Air Products has signed a long-term contract with Weihe Clean Energy Company Limited, a subsidiary of Shaan’xi Weihe Coal Chemical Group Ltd, one of China’s largest coal-based fertilizer and methanol producers, to supply onsite gaseous oxygen and nitrogen for its phase three coal-to-chemicals project in Weinan Hi-Tech Zone (WHTZ) in Weinan city, Shaan’xi Province, Western China.

Air Products will build, own and operate a new air separation unit (ASU) on Weihe’s site near Xi’an, the capital city of Shaan’xi Province. Scheduled to come on-stream towards the end of 2010, the ASU plant will produce more than 2,000 tons of oxygen per day. In addition, Air Products will supply liquid bulk gases to the fast growing merchant market around Xi’an.

Weihe Clean Energy Company Limited is a subsidiary established by Shaan’xi Weihe Coal Chemical Group Ltd. It currently produces methanol and dimethyl ether(DME) and will produce methanol, acetic acid and acetic anhydride in its phase three expansion project. Weihe will use the high-pressure oxygen in the coal gasification process to produce syngas (synthesis gas), which can be further separated into carbon monoxide (CO) and hydrogen. Syngas, CO and hydrogen are important precursors to produce other basic chemicals such as ammonia, methanol and acetic acid, which are essential in the production of a variety of products including paints, adhesives, plastics, construction materials and hundreds of other products for the growing consumer markets in China.

“The success of our large scale projects in China demonstrates our capabilities to help customers win with technology, efficiency and low cost. By leveraging our global expertise and local resources, we are in a very good position to execute these projects and meet our customers’ increasing requirements,” said Howard Castle-Smith, vice president of Tonnage Gases Asia, Air Products. “With this contract and investment, we are gaining significant momentum in our Tonnage Gases business to serve petrochemical and refinery customers in China.”

The new ASU will be designed and built primarily by Air Products’ engineering and manufacturing centers in China. In addition to supplying Weihe, Air Products will expand its liquid product capacity to provide a full range of atmospheric gases including oxygen, nitrogenand argon for the fast growing area around Xi’an to meet the growing demand of the electronics and general industries.

“We are honored to play a role in supporting the development of the petrochemical industry in China,” said Wilbur Mok, president of Air Products Asia. “Our facility will be one of the first in that region to produce liquid products. It puts us in a very competitive position to meet the growing product demand that is driven by strong economic and industrial development in the region, in a very cost-effective and efficient way.”

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