INTERNATIONAL TAR ASSOCIATION 2017 ANNUAL CONFERENCE PRAGUE, SEPTEMBER 25 26, 2017 CENTRAL EUROPEAN, UKRAINIAN, AND RUSSIAN COKE PRODUCTION, COAL TAR PRODUCTION AND DISTILLATION: HISTORICAL REVIEW AND FORECAST 2000 2020 DR. ZYGMUNT STOMPEL, POLAND
DISCLAIMER: This presentation covers cokemaking and coal tar processing industries in the member states of the former Council of Mutual Economic Cooperation COMECON, i.e. Russia and Ukraine of the former Soviet Union, Bulgaria, Czech Republic and Slovakia (former Czechoslovakia), Hungary, Poland, and Romania and Bosnia Herzegovina of the former Yugoslavia, which were not members of the COMECON. Note: COMECON active from January 1949 till June 1991.
I CENTRAL AND EASTERN EUROPE PRODUCTION OF COKE 2000-2020
HISTORICAL COKE PRODUCTION IN CENTRAL & EASTERN EUROPE: 2000 2016, kt Country 2000 2005 2010 2015 2016 Remarks Bulgaria 900 620 0 0 0 Bosnia 0 450 920 740 700 Czech Rep. 3.400 3.230 2.400 2.100 2.200 Hungary 580 910 1.020 1.000 850 Poland 10.200 9.600 9.540 9.450 9.400 Romania 1.800 1.640 0 0 0 Slovakia 1.780 1.750 1.550 1.680 1.450 Sub-total 18.660 19.950 15.430 14.970 14.600 Russia Ukraine 31.540 30.660 28.470 28.400 28.250 19.720 18.060 17.550 11.100 12.900 Cremikovtse steelworks shut down in 2008 Lukavac and Zeniza works restarted in 2004 Galati steelworks coking plant shut down in 2009 Including Ural and Siberian plants Military conflict in Eastern Ukraine started April 2014
CENTRAL EUROPEAN COKEMAKING INDUSTRY 2017 2020: A CLOSER LOOK Country Company Location 17 Capacity 17 Prod. 20 Prod. Remarks Bosnia Arc.Mittal Zenica 740 400? Lack of environm. permit Ispat Lucavac 700 300? Debts, workforce problem Czech Rep Arc.Mittal Ostrava 1.500 1.150 1.100 OKK Svoboda Ostrava 850 650? 600 Future of OKD? Trinecke Zel Trinec 700 700 700 Fresh after rebuilding Hungary ISD Koksolo Dunaujvaros 1.100 1.000 1.000 Fresh after rebuilding Poland Arc.Mittal Zdzieszowice 4.200 3.900 4.200 Arc.Mittal Kraków 660 600 650 JSW Koks Dąbrowa G. 2.650 2.650 2.600 Rebuilding planned JSW Koks Zabrze 1.300 1.000 750 Debieńsko shut-down 18 Zarmen Częstochowa 600 600 700 Ongoing expansion Victoria Wałbrzych 600 520 700 Ongoing expansion Carbo-Koks Bytom 240 140 0 End of operational permit Slovakia US Steel Kosice 1.800 1.400 1.200 No repairs planned Total 17.640 15.010 14.200
CENTRAL EUROPEAN COKEMAKING INDUSTRY 2020 A SUMMARY Except Bosnia, all Central European cokemaking countries (Czech Republic, Slovakia, Hungary, and Poland) are members of European Union. Newest EU environmental protection regulations about to be implemented will make building a coking plant from the ground almost impossible. Expect some rebuilding programs only. Therefore, coke production forecast for 2020 and beyond is no more than figure. Poland will remain the biggest producer of coke in the European Union. Expect gradual rebuilding of JSW Koks Przyjaźń (Dąbrowa Górnicza) batteries. US Steel thinks about selling Kosice stelworks but its coking plant will remain operational. Dunaujvaros looks stable.
RUSSIAN COKEMAKING INDUSTRY 2017 2020 A CLOSER LOOK Company Location 17 Capacity 17 Prod. 20 Prod. Remarks Severstal Cherepovets, Europe 4.400 4.300 4.700 Rebuilding planned NLMK Lipetsk, Europe 2.400 2.400 2.400 Continuation Mechel - Moscow Vidnoe (Moscow) 1.200 700? For sale since 2014 Gubakha Coke Gubakha, Ural 1.300 350? Future uncertain MMK Magnitogorsk, Ural 6.200 5.200 5.500 Continuation Mechel Koks Chelyabinks, Ural 3.500 2.000 2.400 Repairs in progres Evraz - NTMK Nizhniy Tagil, Ural 2.700 2.200 2.500 Repairs in progres Ural Steel Novotroitsk, Ural 1.800 1.300 1.500 Altay Koks Zarinsk, Siberia 4.700 4.100 4.400 Rebuilding planned IMH - Koks Kemerovo, Siberia 3.000 2.700 2.800 Evraz - Zapsib Novokuznetsk, Siberia 3.600 3.000 3.400 Total Russia 34.800 28.250 29.600
RUSSIAN COKEMAKING INDUSTRY 2020 A SUMMARY After a couple of years of decreasing production and suspension of investment, a sort of stabilization in Russian cokemaking industry is observed, with mild signals of reversing the trend. We can t exclude elimination of some minor producers, but big players (Magnitogorsk, Cherepovets, Kemerovo, Novo- Lipetsk, Altay Koks) will survive and even improve. The biggest asset of the Russian cokemaking industry is an abbundance of good quality and cheap (open-cast mines) coking coal.
UKRAINIAN COKEMAKING INDUSTRY 2017 2020 A CLOSER LOOK Company Location 17 Capacity 17 Prod. 20 Prod. Remarks ISD Alchevsk 3.600 1.200? Lugansk District Metinvest Avdeyevka 4.000 2.200 3.600? Donetsk District Metinvest Mariupol 2.600 1.400 2.000? Donetsk District Metinvest Yenakiyevo 1.000 500 900? Donetsk District Donetskkoks Donetsk 450 300? Donetsk District Donetsk Steel Makeevka 1.200 900? Donetsk District Donetsk Steel Yasinovka 1.700 0? Donetsk District Istek Gorlovka 450 250? Donetsk District Evraz Dniprokoks Dnipropetrovsk 900 700 850 Dnipropetrovsk D. Evraz Yuzhkoks Dniprodzerzhinsk 900 650 850 Dnipropetrovsk D. Metinvest Zaporozhya 1.700 1.100 1.600 Zaporozhya D. Metinvest Dniprodzerzhinsk 1.000 650 900 Dnipropetrovsk D. ArcelorMittal Kryvyy Rih 3.000 2.000 2.800 Dnipropetrovsk D. Kharkiv Coke Kharkiv 200 150? Kharkiv District Total Ukraine 22.700 12.000 13.500+?
UKRAINE
UKRAINIAN COKEMAKING INDUSTRY 2020 A SUMMARY 68 % of Ukrainian installed cokemaking capacity is within Donetsk and Luhansk districts, i.e. those affected by fightings. Those plants are operational, and will remain as that (most probably), but nobody knows to what extend. At the moment (June July 2017) three Metinvest coking plants in Donetsk District (Avdiivka, Yenakievo, and Mariupol) works at the full available capacity, with some repairs in progress. The biggest problem however arises from broken supplying lines. Cokemaking plants in Central Ukraine (Zaporozhya and Dnipropetrovsk districts) are returning gradually to full operational capacity. Expansion at ArcelorMittal Kryvyy Rih.
II CENTRAL AND EASTERN EUROPE PRODUCTION OF COAL TAR 2000-2020
HISTORICAL PRODUCTION OF COAL TAR IN CENTRAL AND EASTERN EUROPE, 2000 2016, kt
CURRENT AND FORECASTED PRODUCTION OF COAL TAR IN CENTRAL AND EASTERN EUROPE, 2017 2020, kt Country Coal tar 2017 Coal tar 2020 Remarks Bosnia 30 15 (?) Czech Republic 98 95 (?) Hungary 40 40 Poland 395 405 Slovakia 60 60 Uncertain future of Ispat s coking plant at Lucavac Total shut-down of OKD coal mines by 2020: to what effect? Shut-down of the smallest plants, intensification elsewhere Total Central Europe 623 615 Russia 1.120 1.180 Ukraine 510 650 Central & Eastern Europe 2.253 2.445 Assuming gradual recovery and no more damages
III COAL TAR PROCESSING INDUSTRY IN CENTRAL AND EASTERN EUROPE 1990-2020
CENTRAL EUROPEAN COAL TAR PROCESSING INDUSTRY 1990 2008: FALL AND DECLINE Country Plant, location Capacity, kt/y Final shut-down Bulgaria Kremikovtsi (Sofia) 50 1992 Hungary Dunaferr (Dunaujvaros) 50 2004 Poland Blachownia (Kędzierzyn) 360 2008 Zabrze (Zabrze) 250 2005 Sendzimir (Kraków) 100 1997 Chrobry (Wałbrzych) 80 1992 Hajduki (Chorzów) 140 1991 Romania Galati 150 2005 Slovakia VSZ (Kosice) 150 1994
CENTRAL EUROPEAN COAL TAR PROCESSING INDUSTRY 1990 2008: REASONS FOR THE FALL Very old plants (some of them built well before WW II), the newest from the 50 of XX Century Outdated technology, low energy efficiency Outdated products: soft pitch used as a road tar or as a feedstock for pitch coke (Zabrze, Kosice) Lack of environmental control Lack of workforce health protection Decreasing availability of feedstock tar Concentration on local (limited) market Lack of financial support for necessary modernization
CENTRAL EUROPEAN COAL TAR PROCESSING INDUSTRY 2017 AND BEYOND: THE LAST MAN STANDING DEZA a.s. (Dehtovy Zavody), Valasske Mezirici, Czech Rep. HISTORY: - 1892: Julius Ruetgers establishes a tar processing company in Ostrava; - 1945: the company nationalized; - 1950: changes name for Urx; - 1960s: gradual relocation from Ostrava to the new site in Valasske Mezirici, known as Urxovy Zavody; - 1989: changes name as Deza; - 1999: incorporated into the Agrofert Group, one of the biggest corporations in Czech Republic.
CENTRAL EUROPEAN COAL TAR PROCESSING INDUSTRY DEZA a.s., LOCATION
CENTRAL EUROPEAN COAL TAR PROCESSING INDUSTRY DEZA a.s. Installed tar distillation capacity: 460 kt/y (in one unit). Average capacity utilization rate: 83 87 %. Extended downstream processing of tar fractions: in-house crude benzene distillation/rafination, separation of phenol and its homologs, naphthalene distillation/rafination, phthalic anhydride synthesis, anthracene separation and oxidation. Valmez: Cabot/Deza j-v carbon black plant next door. Liquid pitch storage park and loading facilities in the port of Świnoujście, Poland. Solid pitch storage and loading facilities in the port of Szczecin, Poland.
COAL TAR PROCESSING INDUSTRY IN RUSSIA 2017 AND BEYOND Company Location Capacity ktpy Processing 2017, kt Processing 2020, kt Severtar Cherepovets, Europe 300 250 300 Novolipetsk Metallurgical Complex (NLMK) Magnitogorsk Metallurgical Complex (MMK) Lipetsk, Europe 200 0 0 Magnitogorsk, Ural 350 200 250 Mechel Chelyabinsk, Ural 200 120 0 Evraz Nizhniy Tagil, Ural 150 100 0 Evraz Novokuznetsk, Siberia 400 330 350 Total Russia 1.600 1.000 900
RUSSIAN FEDERATION
COAL TAR PROCESSING INDUSTRY IN RUSSIA 2017 AND BEYOND - SUMMARY Focus on SEVERTAR: the newest (start-up February 2016), most modern vacuum tar distillation unit in Russia (and the world). 180 kt of in-site tar at Severstal, the remaining quantity got from other Russian cokemaking plants. Once Severtar has been put into operation, import of Chinese pitch to Russia has died out (H1 2015: 44.7 kt, H2 2015: 46.4 kt, H1 2016: 46.6 kt, H2 2016: 10.0 kt, H1 2017: 1.5 kt. Except Severtar, all other Russian electrode pitch manufacturers apply an air-blowing method for upgrading soft pitch; they may be eliminated in a couple of years for environmental and workplace protection reasons.
COAL TAR PROCESSING INDUSTRY IN UKRAINE 2017 AND BEYOND Company Location Capacity ktpy Processing 2017, kt Processing 2020, kt Metinvest Avdiivka, Donetsk D. 200 110 180 (?) Metinvest Yenakievo, Donetsk 65 0 0 Metinvest Zaporozhya 200 140 190 Metinvest Dniprodzerzhinsk 200 120 190 Tar Alliance Gorlovka, Donetsk D. 250 0? Energo Makiivka, Donetsk D. 100 0 0 Total tar distillation INCOR & Co. (naphthalene plant) Toretsk, Donetsk D. (Metinvest) 1.015 370 560 (?) 50 20?
COAL TAR PROCESSING INDUSTRY IN UKRAINE 2017 AND BEYOND - SUMMARY With Tar Alliance out of picture, Ukrainian tar processing industry (Avdiivka, Zaporozhya, and Dniprodzerzhinsk plants) is in the hands of Metinvest (SCM). Through INCOR & Co. (processing of carbolic and naphthalene oils) Metinvest controls also production of naphthalene and phenols. Despite a ceasfire, there are some occasional fightings in the Donetsk area, affecting Gorlovka. It is difficult to predict whethere Tar Alliance facilities return to activity. Until all Ukrainian tar processing plants return to normal operations, a big chunk of produced tar is exported (data for 2016): Czech Rep. 80 kt, Belgium 20 kt, Denmark 20 kt, Spain 14 kt).
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