Coal to amonia - MI

Coal to Ammonia Presented at the

Iowa Energy Center Meeting Ammonia-The Key to a Hydrogen Economy

By

Mark Ibsen Rentech Development Corporation October 13, 2005

1

Presentation • Rentech Introduction • Producing Ammonia from Coal/Petroleum Coke Gasification • What is Fischer-Tropsch?

• East Dubuque, Illinois • Environmental Benefits • Food Security and Energy Security-Fuel for First Responders, and the US Military

2

Rentech – A Brief History • A 23 year old Denver, Colorado Energy Technology Company – Traded as “RTK” on the American Stock Exchange

• Engaged in the Fischer-Tropsch Development – Coal-to-Liquids (FT/CTL) business – NG-to Liquidss (FT/GTL) business

• Licenses its patented and proprietary technology – 20 U.S. and 1 foreign process and materials patents

• Rentech Development Corporation – Subsidiary of Rentech Inc. – Responsible for ownership and development – Gas-to-Liquid and Coal-to-Liquid Projects

3

Coal to Ammonia a New Concept?

• Not really but for the United States, yes • Today, in the US there are two projects operating – North Dakota Gasification – Coffeyville Resources

• World Wide a number of facilities – China (2500 small local facilitates) – Portugal (uses refinery bottoms) – Germany, Czech, India, Brazil all have ammonia plants from coal

• Key driver, high NG costs

4

Coal Gasification & Ammonia

Coal - 2500 stpd Coal Handling

Coal to Ammonia

Syngas

Water

H2/CO

CO2

BFW

Slurry Gasifier

SynGas Cooling/ Cleaning

Process Boiler

O2 Export Slag

ASU

Acid Gas Removal

Sour Shift

Steam

Guard Beds

H2S Hot BFW

Claus Unit

O2

Process Condensate Water Recycle

Air

Sulphur Loading

N2

PSA Offgas

PSA HRSG

Existing CO2 Removal

HTS Rctrs

LTS Rctrs

H2 Purge to Vent Hot BFW

NH3 Loop

~

LP

MP

HP

Steam Turbine

NH3 - 1500 stpd Power - 10-20 MW Parasitic Power

5 Color Legends:

Gasification

Misc

Ammonia

Indicates units that may or may not be needed.

North Dakota Coal Gasification

6

7

Syngas Derived Products Ammonia UAN Urea

Hydrogen + Carbon Monoxide (H2+CO)

Ultra-Clean Fischer Tropsch Transportation Fuels Synhytech – Pueblo, Colorado, 1992

Syngas

Electricity (IGCC) Methanol/DME/Propylene Synthetic Natural Gas Hydrogen Carbon Dioxide 8

Gasification Ideal for Syngas Derived Products Ammonia UAN Urea

Hydrogen + Carbon Monoxide (H2+CO)

Ultra-Clean Fischer Tropsch Transportation Fuels Synhytech – Pueblo, Colorado, 1992

Coal

Coal Coal Gasification Gasification

Syngas

Electricity (IGCC) Methanol/DME/Propylene Synthetic Natural Gas Hydrogen Carbon Dioxide 9

10

Illinois Project 11

First Mover Opportunity: Producing Fertilizer, Ultra-Clean Fuels & Electricity From Coal Deploy gasification to save and create jobs while increasing energy and food security through the production of ammonia and FT liquids using Illinois coal as the plant feedstock.

12

Fischer-Tropsch (FT) Synthesis • Invented by German chemists Franz Fischer and Hans Tropsch in 1923. Used by Germany during WWII to produce 600,000 bbl/year of fuels from coal and coke

• Commercially proven worldwide 197,000 BPD Current Production • Since 1950s ~ currently 160,000 bbl/day from coal

by Sasol • Since 1993 ~ 23,000/bbl/day from natural gas by Petro SA using Sasol technology • Since 1995 ~ 15,000/bbl/day from natural gas by Shell in Malaysia

13 4

FT is Commercially Proven Worldwide SASOL (S. Africa)

45 years commercial – 160,000 b/d+ – Feedstock Coal

SASOL’S SOUTH AFRICAN FACILITY

MossGas (S. Africa)

11 years commercial – 22,500 b/d+ – Feedstock Natural Gas

Shell (Malaysia)

9 years commercial – 15,000 b/d+ – Feedstock Natural Gas

14 6

Why Rentech?

Catalyst Flexibility

CTL RENTECH SASOL

GTL CONOCO EXXON SHELL CHEVRON/SASOL World’s Largest FT Slurry Reactor – Synhytech, 1992 15 7

Rentech CTL with Fertilizer Air Power

ASU

Vent

to Vent or Sequestration

N2

O2

CO2

BFW

Gasifiers

Waste Heat Boiler or Quench

Ammonia Plant

Syngas Conditioning & Purification

Fertilizer Sales

Syngas Exp. Slag

Coal Prep.

Pet-coke or Coal

Process Condensate Recycle

Exp. Sulphur

Water for Slurry or Heat for Drying Steam H2 Rem.

Steam BFW Steam

BFW

Off-gas to Fuel

Gas Turbine

Tail-Gas to Fuel

HRSG

FT Synthesis

~

H2 for FT Product Upgrade Crudes

Off-gas to Fuel

~ Steam Turbine

Parasitic Power

Product Upgrade

FT DIESEL

NAPHTHA

Power Sales

16

East Dubuque Plant

17

4,000,000

2,000,000

5,000,000 10.00

4,500,000 9.00

ammonia production

3,500,000 7.00

3,000,000 6.00

2,500,000 5.00

natural gas price

4.00

1,500,000

IL #6 Coal Price

500,000 1.00

0.00

18

$ /M M B tu

1,000,000

1 9 9 6 -0 1 1 9 9 6 -0 2 1 9 9 6 -0 3 1 9 9 6 -0 4 1 9 9 7 -0 1 1 9 9 7 -0 2 1 9 9 7 -0 3 1 9 9 7 -0 4 1 9 9 8 -0 1 1 9 9 8 -0 2 1 9 9 8 -0 3 1 9 9 8 -0 4 1 9 9 9 -0 1 1 9 9 9 -0 2 1 9 9 9 -0 3 1 9 9 9 -0 4 2 0 0 0 -0 1 2 0 0 0 -0 2 2 0 0 0 -0 3 2 0 0 0 -0 4 2 0 0 1 -0 1 2 0 0 1 -0 2 2 0 0 1 -0 3 2 0 0 1 -0 4 2 0 0 2 -0 1 2 0 0 2 -0 2 2 0 0 2 -0 3 2 0 0 2 -0 4 2 0 0 3 -0 1 2 0 0 3 -0 2 2 0 0 3 -0 3 2 0 0 3 -0 4 2 0 0 4 -0 1 2 0 0 4 -0 2 2 0 0 4 -0 3 2 0 0 4 -0 4

m a te ria l to n s

U.S. Ammonia Production vs. Natural Gas & Coal Price 8.00

3.00

2.00

Source: Ammonia production, U.S. Department of Commerce; natural gas price - average spot-deliverd-to-pipeline price, Natural Gas Week.

The RC Plant Post Conversion to Coal Feedstock Integrated Manufacturing Process CONVERSION Coal

Internal Power Steam

5200 tpd Water

Air

Air Separation Plant

Coal Gasification - Syngas Production

Power Plant

PRODUCTS Export Power

Tail Gas

FT Product Upgrade

FT Synthesis

ULS FT Diesel

Naphtha

Sulfur N2

EXISTING PLANT

NH3 Production

H2

Ammonia Synthesis

Carbon Dioxide Plant

CO2 NH3

NH3 Sales

Urea

Air

Nitric Acid Plant

CO2 Sales

Nitric Acid

Urea Plant

Granular Urea Sales

Urea Solutions Sales Nitric Acid Sales

Ammonium Nitrate/ Blending Plant

UAN Sales

19

Coal Gasification Yielding Rentech FT Fuels & Power & Ammonia

Coal - 5200 stpd

E. Dubuque AgriEnergy

(Simple Recycle FT Process, 1 Gasifier)

Coal Handling

Water

CO2 BFW

Slurry Gasifier

Syngas

SynGas Cooling/ Cleaning

Process Boiler

O2

AGR

Steam

H2 S

Claus Unit

Hot BFW

Export Slag

Guard Beds

(Rectisol)

ASU

Air

H2/CO - 0.68

Air

Process Condensate Water Recycle

Sulphur Loading

N2

H2 to Prod Upgrade

Steam

BFW

H2 Purge to Fuel 450 MMbtu/h

PSA

Existing CO2 Removal

New LTS Rctrs

New HTS Rctrs

FT Synthesis

Purge to Vent

FT Water & Ox

H2 Crudes

NH3 Loop

H2

Gasification/FT Steam

Product Upgrade

Naphtha Turbine

~

LP

MP

HP

1.1 MMscfd H2

DIESEL Storage/Loading

~

NAPHTHA Storage/Loading

Diesel - 4700 bpd Steam Turbine

Naphtha- 900 bpd

NH3 - 920 stpd

Air

Parasitic Power

Power - 40 MW Color Legends:

20 Gasification

FT Unit

Coal

NH3

Misc

Indicates units that may or may not be needed.

East Dubuque Plant Polygeneration Model Estimated Inputs and Production • Coal feedstock

5,200 TPD

Products (45% Increase in Tons Shipped) • Ammonia production 920 TPD • FT Fuels (80% diesel) 5,600 BPD • 248,000 gallons per day

• Electricity production • Electricity export

160 MW(e) 40+ MW(e)

21

Benefits of Polygeneration from Coal • Standard pulverized coal power plant: 35% • Combined cycle natural gas power plant: 45% • Coal gasification to produce fertilizer, ultraclean fuels, & electricity: 50+%

22

Coal Cleaner?

Plant Regulated Emissions With a Production increase of 45% in Tons Shipped

3500 3000

>30% Decrease In Criteria Pollutant Emissions

Tons/Yr

2500 2000

Existing Tons/yr Converted Ton/yr

1500 1000 500 0 Existing Tons/yr

Converted Ton/yr

Total Emissions of: PM10 VO CO NOx SO2 23

Ultra-Clean FT Diesel Fuel from Coal • Biodegradable • < 1ppm Sulfur • High Cetane •Stable long storage life Emissions Relative to a Typical Diesel Fuel (Percentage)

0

FT Diesel

-5

-9

-10 -15 -20 -25

-28

-30

-33

-35 -40 -45

Conventional Diesel

-42 Hydrocarbon

Carbon Monoxide

N0x

Particulates

Source: An average of several government funded studies by NREL & SwRI

FTD from coal is an “alternative fuel” under 1992 Energy Policy Act (EPACT) 24

OSD Clean Fuel Initiative Vision: DoD catalyze the commercial industry to produce clean fuels for the military from secure domestic resources using environmentally sensitive processes that create jobs and wealth in the United States

Dr. Theodore K. Barna Assistant Deputy Under Secretary of Defense Advanced Systems and Concepts Pentagon 3D833 703-695-9873 Ted.Barna@OSD.mil

25

DoD Impact Secure and reliable sources of energy Currently dependent on foreign oil

jet fuels, 73.5%

Becoming dependent on foreign refined fuels

ground fuels, 15.1%

marine fuels, 7.9%

Supply chain vulnerability Dependent on mega refineries- Gulf Coast

Military Demand Approx 4% of US Consumption

Natural disasters or Terrorist threats

Ref: DESC Help Book

Need for cleaner fuels

Fuel Costs

Potential limits on deployments

Possible conflict with EU rules

M illio n s o f D o lla rs

DoD exempt from some EPA regulations

6000 5000 4000 3000 2000 1000 0

Army Navy Air Force Marines 97

98

99

0

1

2

3

4

5

Fiscal Year

26

Total Energy Development (TED)

Use all secure indigenous sources of energy Coal, shale oil, petroleum coke, renewables Dispersed production facilities

Minimize government funding—focus on qualification and certification

Make a better fuel from coal and petroleum coke (Fischer Tropsch fuels) and oil shale Low (or no) sulfur, cleaner burning, bio-degradable, low (or no) aromatics, reduced particulate emissions Blends near term, neat fuel future goal Stable fuel for long term secure storage of refined fuel for emergency use

Use Environmentally sensitive processes to produce fuel - Clean Coal Technologies such as the Fischer-Tropsch process, Mahogany Shale Research Project - CO2 sequestration for enhanced oil recovery (EOR) 27

Reduced Exhaust Emissions with FT Fuel Relative to Low-Sulfur Diesel Fuel 0% HC

CO

-10%

% Reductions

-20%

CO2

-4%

-17%

NOx

PM

-13% -15%

-30% -40% -45%

-50% -60% -62%

-70% -72%

-60%

Transient Hot Start testNRTC cycles Hot Start NRTC*

-52% -55%

-80% *Non-Road Transient Composite

FT fuel burns more completely and emissions are significantly cleaner than EPA certified low-sulfur diesel fuel tested in 6.5L diesel engine.

Over 50% reduction in particulate emissions in transient mode.

28

Reduced Particulate Emissions with FT Fuel Relative to JP-8 % Change in Particle Number Density y

0% 12.5

25

-12%

-13%

37.5

50

62.5

75

87.5

100

-25% -25% -30%

-33% -41%

-50% -50%

-51% -57% -61%

-75%

-68%

Cruise

-75%

-78%

Idle -86% -92%

-100%

12.5

25

37.5

50

62.5

75

87.5

-96% 100

% Volume of FT Fuel in JP-8

Even moderate fractions of FT fuel blended in JP-8 significantly reduce exhaust emission particulates in T63 turbine engine testing.

96% reduction* in particulate emissions at idle conditions.

29 * Note: Results are highly dependent on engine model/year and composition of baseline fuel.

Summary • Coal to Ammonia is not a new concept • The Poly-generation concept improves plant efficiency and diversifies product mix • Conversion of exiting facilities improves project schedule, reduces cost and utilizes existing plants • The Ammonia and Fuels provide for Food and Fuels security for the United States • Both Ammonia and FT liquids are a steps toward the Hydrogen Economy • Polygeneration provides diversity and stability to ammonia plants during market swings.

30

Questions

31