-Upgrading the Future-

Commercialization of
®
UBC Process

Shohei Manabe
Executive Officer
Head of Coal & Energy Division
Head of Iron Unit Division
Natural Resources & Engineering Business
Kobe Steel, Ltd.
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Agenda

• Company Profile
• Kobe Steel’s approach to low-quality
natural resources utilization
• UBC Process
• Commercialization of UBC
 Company Profile
• Kobe Steel is known as KOBELCO
– A steel, aluminum, copper and machinery producer as well as
engineering company and coal-based power supplier (1400MW)

• Now focusing on low-grade natural resource utilization

– UBC Process
– New ironmaking technology (pellet feed + steaming coal)
 Kobe Steel’s approach to utilize
low-quality natural resources

<Iron-making>
• Ｐｅｌｌｅｔ utilization in BF instead of lump ore 1966~
• Pulverized coal injection to BF 1980~
• FASTMET direct reduced ironmaking 1992~
• ITmk3 iron nugget making 1994~

<Energy industry>
• Coal liquefaction in China 1939-1944
• Coal liquefaction in Australia 1981-1993
• UBC process development 1990~
• Hyper Coal process development 1999~
 Coal Liquefaction
Catalyst
H/C ratio: 0.8 H/C ratio: 1.5～2
Hydrogen
Gasoline
Coal Kerosene
Gas-oil

Coal is hydrocracked & hydrogenated

at high temperature and pressure to 450℃
obtain liquid fuel. 15MPa

’81～： After the 2nd oil crisis, Brown Coal Liquefaction (BCL)
project was started in Australia & Japan.
(AC, 0.1t/d PDU, 50t/d Pilot Plant Operation)
’93～：Follow-up Studies in Japan
(AC, 0.1t/d BSU Operation)
’99～：Indonesian BCL Feasibility Study
’04～：Follow-up Studies on Indonesian BCL
’08～：US PRB Coal Liquefaction Project 50t/d PP (Morwell, Australia)
 Hyper-Coal (HPC） Process
Solvent recovery Extracte
settler Over flow d Coal

Slurry Solvent
Solid-
Over flow HPC
coal Liquid Solvent
Making extraction separation recovery
Residue
Extraction temp Under flow
350-400℃ RC
HPC process
① Solvent recycled ② No hydrogen used ③ Low temperature, low pressure

HPC Excellent
COAL
High
+ HPC
Strength
thermal plasticity Coke

Additive of coke
for blast furnace
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UBC Process

• Basic Concept
• R&D Project in Indonesia
• Process Description
• Commercialization
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Basic Concept of UBC

Turn Un-utilized Low Quality Lignite

into
High-Value Energy Resource
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Coal (Indonesian Lignites)

Lignite &
Type A Type B Type C
UBC spec.
Raw UBC Raw UBC Raw UBC

Moisture wt% ar 33.6 <10 34.0 <10 60.5 <10

Heating Value kcal/kg 4,460 6,380 4,200 5,810 2,328 6,020

Ash wt%db 2.5 2.7 4.6 4.6 7.7 7.8

Volatile Matter wt%db 51.2 52.5 48.5 50.9 43.3 47.3

Fixed Carbon wt%db 46.3 44.8 46.9 44.5 34.2 38.6

Sulfur wt%db 0.48 0.49 0.17 0.19 0.26 0.27

Process Flow
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Demonstration Project
• Capacity: 600 t/day on product basis
(1,000 t/day on feed coal basis)
• Location: Satui, South Kalimantan
• Coal run: from December 2008 to May 2011
• Raw coal: Arutmin Ecocoal (TM=35%)

Kalimantan

Pilot Plant Java

(3t/d) 14
 R&D Project Structure
＜Japan – Indonesia GG-based R&D Project＞
Japan Indonesia
METI MEMR
Ministry of Economic Trade and Ministry of Energy and Mineral
Industry Resources

MOU

JCOAL
Japan Coal Energy Center

Participate as assigned
entity

PT Bumi Resources
Kobe Steel
Strong Support PT Arutmin
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Demonstration Plant

16
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Results of R&D Project

• Development of the UBC Process was

successfully completed.
• Combustion and transportation tests were
successfully conducted.
• Scaled up information was collected.
• Capital and operation cost data were collected.
• Several research subjects were found and
studies are underway.
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Towards Commercialization
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Commercialization Concept
Lignite
<Disadvantages> Technology (UBC)
•Low CV
•Spontaneous combustion
+
•Increase CV
<Advantages> •Stabilize
•Widely spread in the world
•Huge reserve
•Cheap mining cost

Stable Energy Source

= •Stable Supply
•Stable Cost
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Location and Client

Target Areas
Where will we built UBC plants?

Target clients
With whom are we having discussions?
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Target Areas

<First priority area>

• Indonesia Bitu
mino
us
Sub-
Bitumin
ous
Lig
nite

<Second priority area> Russia(157bil.t)

3% 33%
Canada(6.6bil.t)

• India Europe(108bil.t)

63%
20%
17%
62%

China(114.5bil.t)
34% 53%
13% U.S.A.(237,3bil.t)

India(60.6bil.t) 16% 55% 13% 45%

• China Others (Africa)

7%
93%
29%

Others (Asian) (47.6bil.t)

42%

11% (1.5bil.t)
89% 46% 52%

<Third priority area> South Africa(30.2bil.t)

Indonesia(5.5bil.t)
20%
27%
2%
Colombia (6.8 bil.t)

53% Australia(76.4bil.t)
48% Others(South America)

• Australia 100% 49%

3% 9% (5.8bil.t)
0%

• Russia
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Candidate Clients / Partners

• Mine owners
who want to sell high-moisture lignite, which has no
commercial value now.

• Power utility companies

who want to have a stable price & source of energy.

• Traders
who want to use UBC as a calorie booster.
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UBC Application

<Briquette form: moisture 8-10%, 6000kcal/kg)

• Ocean or rail transport for long distance
• Mix with LRC as calorie booster

<Powder form: moisture 0%, 6670kcal/kg>

• Direct feed to mine-mouth power plant
• Feed to UBC power (including IGCC) plant in
distant location
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Project coming up

• F/S for 1st Commercial Plant is now in progress

with PT DH Energy (Bumi Gr.) and an Asian
power utility.
• The project is in Pendopo, South Sumatra.
• We are also having discussions with several
lignite mine owners in Indonesia and in other
countries.
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KOBELCO’s business scheme

• EPC Business

• License Business
– Construction License to engineering company
– Production License to producer of UBC

• UBC Production Business

– For Captive Use
– For Merchant Sale
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Conclusion
• Kobe Steel has completed R&D of the UBC Process.
The Process has now reached the commercialization
stage.
• The UBC process gives calorific and commercial value
to un-utilized lignite, which is available all over the world.
• The UBC process has various applications beside
briquette export.
• A feasibility study for a 5-million-ton project in Sumatra is
now under way.
• Kobe Steel is ready to discuss commercial projects with
mine owners, power utility companies, traders and
engineering companies.
Thank you

®
UBC Process

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