Eastman and Gasification:

The Next Step - Building on Past Success

By: Bill Trapp

Eastman Chemical Company

Gasification Technologies 2001 Conference

October 7 - 10, 2001

Eastman and Gasification:

The Next Step - Building on Past Success

By: Bill Trapp

Eastman Chemical Company

Gasification Technologies 2001 Conference

October 7 - 10, 2001EASTMAN

hFounded in 1920 as part of EastmanKodak - wood to methanol plant

hApproximately $5 B in sales annually

hOver 400 Chemicals, Fibers and Plastics

hHeadquarters - Kingsport, TN

hManufacturing sites around the world

EASTMAN

E A ST M A N

GasificationMeOH

CarbonylationMeOAc

Esterification Spinning/

Compounding

Sales / DiketeneDerivatives/SolventEsters

Coal

Oxygen

CO

H2

Ac2O HOAc

CelluloseEsters

Sales

Cellulose

PlasticizersDyes

Acetate Tow

Plastic EstersFilm base

Purch. MethanolChemicalsfrom Coalfacility

Acetyl Flow at Eastman

Acetate Yarn

“Acetyl” means any chemical derivedfrom acetic acid or acetic anhydride

CH3COH

O

(acetic acid)CH3CO

O

CCH3

O

(acetic anhydride)

EASTMAN

GasificationMeOH

CarbonylationMeOAc

Esterification Spinning/

Compounding

Sales / DiketeneDerivatives/SolventEsters

Coal

Oxygen

CO

H2

Ac2O HOAc

CelluloseEsters

Sales

Cellulose

PlasticizersDyes

Acetate Tow

Plastic EstersFilm base

Purch. MethanolChemicalsfrom Coalfacility

Acetyl Flow at Eastman

Acetate Yarn

EASTMAN

History of Chemicals from Coal Facility

• Prior to Coal Gas, all acetyl chemicals made frompetroleum

• Start-up of complex in 1983 (1/2 of acetyl demand)

• Expansion of downstream plants 1991, (100% ofacetyl demand)

• Debottlenecking - 1991 to Present Approx. 1300 Tons/Day of Coal converted to Higher Value Chemicals (Ac2O, HOAc)

EASTMAN

Coal

Syngas

ParticulateRemoval

SyngasConversion

TexacoGasifier

Slag/Soot

Steam

SolidsCo-products

Sulfur

CO2

GasificationBasics

Eastman’s Configuration

Chemicals Ac20,HOAc, MeOH, MeOAc

Oxygen

RE

CT

ISO

L

SulfurRecovery

SCOT/Claus

Air

Pro

duct

s

CO

CO/H2Separation

(Lurgi)

CO2/H2SRemoval

EASTMAN

Coal

Syngas

ParticulateRemoval

SyngasConversion

TexacoGasifier

Slag/Soot

Steam

SolidsCo-products

Sulfur

CO2

GasificationBasics

Eastman’s Configuration

Chemicals Ac20,HOAc, MeOH, MeOAc

Oxygen

RE

CT

ISO

L

SulfurRecovery

SCOT/Claus

Air

Pro

duct

s

CO

CO/H2Separation

(Lurgi)

CO2/H2SRemoval

Syn Gas

CO

Methanol MethylAcetate

Acetic Acid/Anhydride

Fibers

Plastics

Solvents

Trade Sales

EASTMAN

Eastman, AirProducts, DOEJoint Venture

Liquid PhaseMethanol

Plant

EASTMAN

Syngas

ParticulateRemoval

SyngasConversion

Gasifier

Slag/Soot

Steam

SolidsCo-products

Sulfur

CO2

GasificationBasicsPower Option

Chemicals Ac20,HOAc, MeOH, MeOAc

Oxygen

SulfurRecovery

CO

CO2/H2SRemoval

Electricity

SyngasCombustion Turbine

SteamTurbine

Coal

PetroleumCoke

Refinery Co-products

EASTMAN

Electricity

Coal

PetroleumCoke

Refinery Co-products

Steam

Syngas

ParticulateRemoval

SyngasConversion

Total Package

Gasifier

Slag/Soot

Steam

Combustion Turbine

SteamTurbine

Bac

k-up

/Pe

akin

g Fu

el

SolidsCo-products

Sulfur

CO2 &Sulfur

Removal

CO2

GasificationBasics

Chemicals

Oxygen

EASTMAN

• Decouples reliability of gasification blockand power block– Produce MeOH while turbine is down or off

peak demand

– Feed MeOH to turbine while gasifier is down

• Use MeOH to supplement when gasifier israte limited

• Sell excess MeOH during low demand

• Use MeOH as start-up fuel

• Produce higher value chemicals forinternal use or resale

Chemical Co-production Benefits

EASTMAN

Keys to Success

• Production Rate

• Reliability

• Maintenance

• Safety

• Environment

• Continual Improvement

EASTMAN

– Stable, continuous demand fordownstream chemicals

– Continous debottlenecking of downstreamplants keeps demand growing

– No back-up supply

– “Downtime domino”

Production Rate & Reliability

Current full rate is approximately 140% of the original design

EASTMAN

Not Needed0.0%

Planned1.2%

Unplanned1.0%

Onstream97.8%

Downtime2.2%

Not Needed Planned Unplanned Onstream

8/99 - 9/01 (Two Year Maintenance Cycle)Gasification Unit Operating Statistics

EASTMAN

8/99 - 9/01 (Two Year Maintenance Cycle)Gasification Unit Operating Statistics

Secondary Measures:

Forced Outage Rate = 1% Unplanned Outage/(On-stream + Unplanned)

Capacity Factor = 120% Annual production/(Design full rate X 365 days)

EASTMAN

MaintenanceMaintenance

1. Continually balancing reliability vs maintenance staffing

2. New process to increase % “planned” maintenance

3. Improvement projects targeted at increased reliability

4. Bi-annual shutdown efficiency improvements

5. Overall cost trending down

EASTMAN

Safety

• Plant Site OSHA-R rate is 1.1

• Gasification area OSHA-R 1.0

• Last work day out case was 10 years ago

• Plant site received Tennessee OSHA “VolunteerStar” certification

EASTMAN

EnvironmentEnvironment

• Sulfur removal is 99.9%

• NOX is not an issue

• Mercury removal since start-up

• Patented sulfur-free start-up process

• Excellent record and reputation with EPAauditors

• Sulfur removal is 99.9%

• NOX is not an issue

• Mercury removal since start-up

• Patented sulfur-free start-up process

• Excellent record and reputation with EPAauditors

EASTMAN

Major Improvements and Enhancements

h Feed Injector Design Improvements

h Alternate Feedstocks

h Complex Shutdown Planning/Execution

h Gasifier “Quick-Switch”

h State-of-the-art Distributive Control System

h On-site expertise on refractory changeouts

h Sulfur-free start-up

Continual Improvement

EASTMAN

Where is Gasification going ?

• Most flexible (power, chemicals or both)

• Power industry holds the most promise(number of projects and scale)

• Raw material is cheap and stable

• “Cleanest” coal technology• SOX, NOX, PM very low

• Some improvement on CO2, Best option for CO2sequestration

• Hg removal economical

• Proven technology

EASTMAN

Where is Gasification going ?

It’s on the verge of taking off!

EASTMAN

So what’s the problem ?

Where is Gasification going

• Capital Cost

– Reliability

EASTMAN

So what’s the problem ?

Where is Gasification going

• Capital Cost– This will naturally come down with

duplication and scale– PC and NG are mature and have a

head start

EASTMAN

So what’s the problem ?

Where is Gasification going

– Reliability

–Eastman can solve this problem

EASTMAN

Eastman will begin exploring O&M servicesoptions for the gasification industry

Building on past success

h Proven track record (18+ years experience)

h Industry leading performance

h Vast support services

h Commitment to excellence

EASTMAN

Let’s take the next step together

EASTMAN