Ping An View:
The rise and fall of coal chemical industry has always been closely related to oil price, war and politics. From the development history of world coal chemical industry, the development of coal chemical industry has experienced four periods: start-up, development, depression and recovery. At present, affected by geopolitics, demand recovery and other factors, the international oil price has hit a high of $100 / barrel. The rise and fall of coal chemical industry has always been closely related to oil and natural gas chemical industry. In the case of tight world oil supply and high price, coal chemical industry has become an important choice to replace oil supply.
China’s modern coal chemical technology as a whole is at the world leading or advanced level. After years of development, China’s modern coal chemical industry demonstration project has been successful, the industry has begun to take shape, the layout has initially taken shape, has mastered the core technology and process with independent intellectual property rights, and the equipment manufacturing capacity has also been improved. By the end of the 13th five year plan, China had built 10 coal to oil, 4 coal to natural gas, 32 coal (methanol) to olefins and 24 coal to ethylene glycol projects. During the “14th five year plan” period, coal chemical industry will still develop rapidly, especially coal to oil and low-grade coal quality utilization under high oil prices or large growth space.
Under high oil prices, coal fuel has more advantages in economy. According to statistics, the increment of coal used in coal chemical industry in 2021 compared with that in 2015 is equivalent to replacing oil by 40 million tons, which has produced a good effect of replacing oil. Under the current coal price, the international oil price is around us $60 / barrel, and the coal to oil project can achieve breakeven; In the case of high oil prices and expected decline in coal prices, the economic benefits of coal to fuel are more significant.
Coal to fuel technology and related core equipment shall be localized. The localization rate of complete sets of coal chemical equipment in China has reached 90%. For direct liquefaction, hydroliquefaction unit, hydrostabilization unit, hydrocracking unit, coal to hydrogen unit, air separation unit and gas to hydrogen unit account for a high proportion of investment; For indirect liquefaction, coal gasification unit, carbon monoxide change, syngas purification and oil synthesis account for a high proportion of investment. The investment in the quality separation and utilization of low-grade coal such as pyrolysis and tar processing is large. Taking the coal liquefaction project as an example, the construction of a 10 million T / a project requires an investment of about 200 billion yuan, and relevant equipment suppliers will benefit.
Investment suggestion: from the development history of world coal chemical industry, the development of modern coal chemical industry is mainly closely related to oil price, war, politics and other factors. Under the pressure of tight world oil and gas supply and high price, coal chemical industry will become an important alternative to oil supply. At present, we believe that under the high international oil price, the profitability of coal to fuel has improved significantly, which will usher in development opportunities. Coal to oil and coal quality utilization projects are expected to gradually move from planning to implementation, and equipment suppliers and engineering companies upstream of coal chemical industry may benefit. Gasifier, hydrogenation reactor and air separation unit are important equipment of coal to oil project. It is suggested to pay attention to the manufacturers of gasifier equipment Changzheng Engineering Co.Ltd(603698) , Yunding Technology Co.Ltd(000409) , Lanzhou Ls Heavy Equipment Co.Ltd(603169) , domestic suppliers of large-scale air separation equipment Hangzhou Oxygen Plant Group Co.Ltd(002430) , Xi’An Shaangu Power Co.Ltd(601369) , etc.
Risk tips: 1) due to the influence of macro situation and other factors, the international oil price may drop, resulting in the construction of coal chemical projects not as expected; 2) Under the policies of environmental protection, double carbon target and double control of energy consumption, the company further strictly restricts the approval of coal chemical projects; 3) Fierce competition among equipment suppliers, or resulting in the reduction of gross profit margin of equipment, which has an impact on the profits of relevant companies; 4) Raw materials such as iron and steel in the upstream of coal chemical equipment increased greatly, resulting in a decline in the gross profit margin of the equipment and an impact on the profits of relevant companies.
