(EnergyAsia, September 6 2011, Tuesday) — France’s Air Liquide said its Engineering & Construction division has signed a contract with the Shenhua Ningxia Coal Industry Group (SNCG) in China, one of the world’s largest coal companies, to build a 500,000 tonne/year methanol-to-propylene (MTP) plant.

To be located in Ningdong in Ningxia province, the plant will have the annual capacity to produce 500,000 tonnes of propylene from coal. The project’s engineering phase will be completed within eight months.

Air Liquide said the contract followed the successful commissioning of the first industrial scale unit that it had also built for SNCG.

With cheap oil increasingly scarce, the French chemicals and industrial gas company said its Lurgi’s methanol-to-propylene (MTP) technology offers China a highly profitable route to exploit its vast coal reserves and its rapid deployment of coal-based production of chemicals and fuels.

The latest contract calls for Air Liquide Engineering & Construction to provide basic engineering, licence and proprietary equipment as well as services for procurement and technical advisory services at the site.

Air Liquide, which remains the sole owner and licensor of the Lurgi MTP technology, said SNCG has agreed to help market the technology in China.

François Venet, chairman of the E&C committee, said:

“The MTP technology offers very promising perspectives to fight the world’s dependency on crude oil. Today, thanks to its cost-efficient and state-of-the-art technology Air Liquide is well positioned to play a major role mastering environmental challenges. We are proud to be able to contribute to SNCG’s responsible and rapid development thanks to Lurgi’s strong relationship with SNCG and the mutual reliability and trust which are major factors for continuing our fruitful collaboration today.”

Air Liquide Engineering & Construction has laid claim to being a major global player to meet the increasing demand for coal-based chemicals and solutions for efficiency and environment protection. Air Liquide, the world leader in producing industrial gases, operates in 80 countries with 43,600 employees.