Shenhua Group’s Carbon Capture and Storage Demonstration

By Wu Xiuzhang
Deputy Chief Engineer, Shenhua Group
Chairman, China Shenhua Coal to Liquid and Chemical Co., Ltd.

The Chinese government places great importance on the issues of greenhouse gas emissions and climate change. On the eve of the 2009 Copenhagen conference, the government of China put forth a target of reducing CO2 emissions per unit of GDP in 2020 by 40–45% compared to 2005. In the “Outline of the 12th Five-Year Plan for the National Economic and Social Development of the People’s Republic of China”, China stated its plan to “significantly reduce the intensity of energy consumption and the intensity of carbon dioxide emissions, effectively controlling greenhouse gas emissions”, which highlighted China’s conviction and determination to combat climate change.

The Shenhua CCS demonstration project, located in Ordos, Inner Mongolia, is China’s first deep saline aquifer storage project with a capacity of 100,000 tonnes CO2/yr.

The Shenhua CCS demonstration project, located in Ordos, Inner Mongolia, is China’s first deep saline aquifer storage project with a capacity of 100,000 tonnes CO2/yr.

Shenhua Group is one of the largest coal-based integrated energy suppliers in the world. In recent years, there have been significant improvements in the coal-to-liquids and coal-to-chemicals sector. These improvements have led the way for strategic energy security projects, such as domestically producing petroleum alternatives and developing clean coal technology in China and the world. While actively promoting petroleum alternatives and clean coal technologies, Shenhua Group is also paying close attention to major issues such as CO2 emissions and climate change, and is actively exploring the development of a coal-based low-carbon energy system for China. One major step in this development is the comprehensive (i.e., capture and storage) CCS project at its Ordos direct coal liquefaction facility.

Introduction to CCS

CO2 capture and storage consists of the three major processes of capture, transportation, and storage. Presently several capture approaches have been commercialized in various industries, such as solvent absorption, adsorption, membranes, and the cryogenic
separation method. Liquid amine absorption is the most advanced capture technology. For large-scale CO2transportation, pipelines are generally used. CO2 storage includes options such as geological storage, mineral sequestration, biological sequestration, and resource production [i.e., enhanced oil recovery (CO2-EOR) and enhanced coalbed methane recovery (CO2-ECBM)]. As current estimates show that geological storage has the greatest capacity, discussions involving CCS often refer to geological storage.

Since the 1970s, regions such as the U.S. and Europe have gradually mastered CO2 utilization (called CCUS) for CO2-EOR, including CO2 flooding theory, displacement process, monitoring, anti-corrosion technology, and simulation abilities.

In the past two decades, researchers have also made progress related to CO2-ECBM in the areas of coal adsorption theory, storage mechanisms, replacement simulations, and engineering technology.

Currently, deep salt/saline aquifer storage (DSR) is one of the most prominent storage methods. Its features include huge storage volumes and the ability to achieve permanent storage. In Europe, North America, Australia, and Japan, in-depth research is being carried out on deep salt/saline aquifer storage mechanisms, potential assessment techniques, geochemical effects, safety and risk assessments, monitoring techniques, and other important aspects.

In China, there have been demonstrations of both CCUS and CCS. China’s National Petroleum Corporation (CNPC) and Sinopec have successively launched CO2-EOR campaigns in the oil fields of Jilin, Zhongyuan, Shengli, Jiangsu, Daqing, Changqing, etc., and have gained notable research achievements. China Huaneng Group and China Power Investment Corporation have built prototypes to capture CO2 from flue gas in Beijing, Tianjin, and Shanghai, and in Chongqing, respectively. China United Coalbed Methane Co., Ltd. has been conducting CO2-ECBM pilot experimental projects in two wells. Shenhua Group’s salt/saline aquifer storage demonstration project in Ordos, the focus of this article, has been operating since 2011.

Overview of the Shenhua CCS Demonstration Project

Shenhua’s 100,000 tonnes CO2/yr CCS demonstration project, which is currently in operation, is located in Ejin Horo Banner of Ordos City, Inner Mongolia. It is currently China’s first pilot project for deep salt/saline aquifer storage, as well as China’s first entirely coal-based CCS demonstration project. The project channels some of the CO2 exhaust discharged from Shenhua’s direct coal liquefaction plant to a storage site located about 11 km to the west.

Trucks are used to deliver 100,000 tonnes CO2/yr to the Shenhua CCS project storage site.

Trucks are used to deliver 100,000 tonnes CO2/yr to the Shenhua CCS project storage site.

After several years of research, Shenhua Group developed a high-concentration CO2 purification (i.e., capture) technology. Shenhua also selected the CO2 transport method, and developed the potential storage assessment technology and transport simulation technology for saline aquifer storage. In addition, storage safety assessment techniques, warning techniques, and supervision techniques were brought into the operation. By building, running, tracking, and monitoring the demonstration project, comprehensive evaluations have been carried out, which in turn have led to a comprehensive package for CO2 capture, transport, storage, and supervision techniques, building a CCS R&D platform, and forming a CCS R&D team.

Shenhua CCS Demonstration Technologies

CO2 Capture Process

The first step of the CO2 capture process is to compress the CO2 from the gasification unit in the direct coal liquefaction process. The pressurized CO2 then is subjected to desulfurization and deoiling, temperature swing adsorption (TSA) dehydration, freezing, liquefaction, distillation, and deep refrigeration. Thereafter, the processed CO2 is sent to a tank that is then loaded onto a platform truck to be delivered to the storage area. The CO2 capture process is shown in Figure 1.

Figure 1. Flow chart of Shenhua’s CO2 capture process

Figure 1. Flow chart of Shenhua’s CO2 capture process

CO2 Storage

Cryogenic liquid CO2 is transported by trucks to the storage site, where it is then unloaded to a low-temperature buffer tank. When a certain storage level is reached in the tank, the storage pump is activated to inject the cryogenic liquid CO2 warmed by the heater into the first injection well. During the injection process, there is continual heat exchange with the stratum, and the supercritical state is reached after injection.

The Shenhua project adopted a sequestration plan that encompasses multilayered injection and layer-by-layer monitoring. This provides the opportunity to measure important parameters to assess the movement and spread of supercritical CO2 in different strata. In the injection process, the injection is monitored at every layer by the monitoring equipment of the corresponding layer in the first monitoring well. The monitoring equipment in the second monitoring well mainly monitors potential leakage of CO2 in the storage process; it is a form of safety monitoring. In addition, the area is assessed for stratigraphic changes through vertical seismic profile (VSP) earthquake monitoring conducted annually. A diagram for Shenhua’s CO2 storage project is shown in Figure 2.

Figure 2. Schematic diagram of CO2 storage

Figure 2. Schematic diagram of CO2 storage

Feasibility and Security Storage Measures

To ensure that the single-well 100,000 tonnes CO2/yr injection rate can be safely maintained even in the stratum with low porosity and low permeability, the Shenhua CCS demonstration project fully utilizes all potential storage layers and carries out different forms of fracturing on three of the five layers. By increasing the injection interface, the impact of the low-porosity, low-permeability stratum on the injection has been reduced.

To prevent leakage of injected CO2 along the wellbore, special materials are used in the casings and injection pipes, and throughout the drilling process; at the same time, gas seal tests are conducted on every casing interface as well as every injection pipe interface. The cement slurry of intermediate casings and production casings are also returned to grade level and checked for adequate assurance of cementing quality.

The control of key parameters such as injection temperature and injection pressure is crucial for geological storage. Differing from reported experiences overseas, in this project the injection temperature is based on the supercritical state of the CO2 entering the stratum, and is adjusted based on the fluctuations in the injected amount. The injection pressure is based on the principle that the inlet pressure of the most shallow injection layer should be less than 80% of the fracture pressure of that stratum; this provides an adequate safety margin to ensure that no fissure appears at the storage layer, which could affect the seal of the cap rock.

Project Monitoring System

The key to the success of CCS lies in the injectivity of the stratum and the reliability of the storage. In China, there is a lack of engineering practice in the field of saline aquifer storage. Therefore, in addition to the previously mentioned technologies, the Shenhua project has incorporated a series of comprehensive monitoring systems.

The Shenhua CCS demonstration project employs an approach utilizing one injection well and two monitoring wells. The first monitoring well is used to monitor the temperature and pressure changes in each storage layer, while the second monitoring well is used to monitor the pressure and temperature changes in the aquifer above the regional cap rock. Water samples are also regularly drawn from the second monitoring well for laboratory analysis to promptly detect any potential leakage in the regional cap rock.

The grade-level monitoring system is mainly comprised of air, soil, surface water, and ground deformation monitoring systems, all of which continuously monitor the injection site. Through a series of engineering techniques and practices, the feasibility and leak-proof security of the injected CO2 has been successfully demonstrated in the Shenhua CCS demonstration project.

Recent Progress

There has been some important recent progress in the project, which is summarized below:

  1. In July 2013, the second monitoring well was used to complete a second VSP earthquake test, and a comparative study is currently being carried out with the 2011 monitoring results.
  2. In August 2013, the “First Large-Scale Exploration of Carbon Dioxide Capture and Geological Storage in China”, a monograph of the Shenhua CCS project, was officially published.1
  3. On 27 September 2013, the third production test was completed, and a comparative study of the three tests, which includes those from 2011 and 2012, is currently being conducted.
  4. As of late October 2013, a total accumulated amount of 154,000 tonnes of CO2 have been injected. At the start of 2012, the injection rate reached or exceeded the design value.

Investment and Cost Analysis

According to investment and operating cost calculations, under current conditions the full cost of capturing and storing each tonne of CO2 is 273 RMB/tonne CO2 (US$45/tonne CO2), including the construction cost of 88 RMB/tonne CO2 (US$14/tonne CO2) and operating cost of 185 RMB/tonne CO2 (US$30/tonne CO2). Once industrial scale is reached, storage and transport costs will be reduced by using pipelines for transport; the total cost for CCS can be further reduced to achieve commercially acceptable standards.

Seven Major Breakthroughs

The Shenhua CCS project is the first of its kind and has resulted in a new CCS technology and increased knowledge related to storage. Seven major breakthroughs deserve mention:

  1. The project is currently the world’s first and only comprehensive demonstration project that combines CO2 capture from coal-to-chemicals and deep saline aquifer storage. It is Asia’s first comprehensive CCS demonstration project that combines capture, purification, compressed storage, injection, low-permeability geological storage, as well as monitoring.
  2. This is the first project tailored to geological storage of CO2 in low-porosity, low-permeability saline aquifers, whereby CO2 is injected into a saline aquifer and fractures have been used to enhance permeability. This is an important investigation because China’s geology is characterized by similar storage sites.
  3. In addition to storage in the saline formation, the project has achieved the storage of CO2 in limestone, thus expanding the scope of CCS applications and providing new solutions for CO2 storage from emission sources in other regions.
  4. Under the project, new approaches to determine the suitable injection temperature, injection pressure, and other important parameters have been developed for CO2injection into low-porosity, low-permeability saline aquifers.
  5. The project pioneered multilayered injection and layer-by-layer monitoring, providing the best injection solutions for a range of strata that could be encountered during large-scale, industrialized CCS in China.
  6. The project has adopted and implemented simulation technology for the transport and spreading of CO2 in fractured media as well as simulation technology for the transport and spreading of CO2 under multilayered injection.
  7. The project successfully demonstrated synchronized implementation and completion of industrial production, learning, and research. At the same time, the multidisciplinary, multifield, and multi-industry management has formulated a successful management model for the development of the CCS industry.
This monitoring well is utilized in layer-by-layer monitoring.

This monitoring well is utilized in layer-by-layer monitoring.

Significance of the Shenhua CCS Demonstration Project

The Shenhua CCS demonstration project has been highly valued by industry, both domestic and international, as well as many ministries and commissions within China. It has successively been listed as a development project by the Ministry of Science and Technology, the National Energy Administration, and the China Geological Survey under the Ministry of Land and Resources; it is also a China-U.S. international cooperation project and has been recognized by many other key national scientific research groups. It was also subsidized by the Ministry of Environmental Protection due to its environmental and public benefits.

The Shenhua CCS demonstration project has successfully demonstrated the entire CCS chain, indicating Shenhua has created several major breakthroughs in key CCS technologies. When the project is under normal operations, the annual reduction of CO2 emissions is equivalent to the total volume of CO2 absorbed and stored by 274 hectares of broadleaf forest. The successful implementation of Shenhua’s CCS demonstration project has uncovered China’s storage potential through active exploration of CO2 geological storage capacity. It has promoted the status of R&D and the CCS-related demonstration work of the country, and laid a foundation for enhanced CCS and CCUS. CCS will have a profound impact in the fight against climate change.



  1. Carbon Dioxide Capture and Geological Storage: The First Massive Exploration in China, 2013: Science Press.


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