Nov-2022

Needle coke — overcoming quality challenges in a resurgent market

The quality of needle coke precursors as a function of their origin and/or process is discussed against a backdrop of the drive to enhance quality, purity, and consistency.

Marcio Wagner da Silva, Petrobras
John Clark, Coke Consulting Company

Article Summary

The needle coke market is in the process of a demand resurgence based both on Chinese demand for graphite electrodes and additional diversification into lithium ion battery anodes, driven by the market expansion of electric vehicles (EVs). This demand will likely show sustained growth for the foreseeable future with associated pricing support over the period.

There is a specific demand for ultra-premium, high purity needle coke from both applications, driven by a requirement to derive maximum in-situ performance from these materials. The two main ultra-premium needle coke precursors include high-temperature coal tar pitch (HT-CTP) and fluidised catalytic cracker decant oil (FCCDO), the latter enjoying market dominance (80%).

Quality issues associated with HT-CTP relate to technical issues stemming from process origin, environmental concerns (carcinogenetic and emissions), and inconsistent quality. Quality issues relating to FCCDO are generally associated with heavier, higher sulphur crude oils and the competition (by the bunker fuel market) for sweeter crude oil downstream derivatives.

The search for consistent quality, high purity needle cokes may in future broaden the scope of potential precursors in line with the trend towards cleaner fuel technology (such as natural gas) over the medium-term period at least. Utilising natural gas as a source, gas-to-liquid (GTL) technology offers the automotive industry a cleaner source of liquid hydrocarbon fuels. With the benefit of these fuels being synthetic, their quality is less dependent on origin (as is much the case with crude oil).

This not only relates to the lighter automotive fuels, but additionally applies to the purity of the heavier residual waxy oil (C20+) streams. The lack of inherent contamination (thermally stable nitrogen and sulphur heterocycles, which have a detrimental effect on needle coke quality) makes this fraction an intriguing prospect. However, the additional lack of any inherent aromaticity would seem to be in contrast with historically desirable characteristics associated with needle coke precursors.

What is needle coke?
Needle coke is produced in a delayed coker from aromatic petroleum or coal tar heavy residues. They generally form as highly crystalline graphene-like carbons, exhibiting long-range microstructural order with minimal impurities (sulphur, nitrogen, and metals) and a low coefficient of thermal expansion (CTE). Historically, needle cokes have been used to produce graphite electrodes for steel smelting in an electric arc furnace (EAF). The advent of EVs has additionally diversified the scope of application for needle coke (inclusion in graphite anodes of lithium ion batteries).

Additionally, the needle coke market has utilised low sulphur vacuum residues (LSVR) and ethylene tar pitches (ETP) precursors, although they have mostly been associated with lower quality needle coke grades. Solvent refined coals (SRC) have been trialled at a pilot plant scale, but there is no evidence of any sustained commercial production. However, the two dominant ultra-premium needle coke precursors stem from the petroleum industry (FCCDO) and the coal blast furnace industry (HT-CTP).

These heavy liquid residuals are converted to solid coke and cracked distillates in a delayed coker unit (DCU) in the temperature range of 450-500°C (dependent on the thermal stability of the feedstock). Unlike other coke types, needle coke microstructural and crystalline order is particularly important. The aromaticity associated with most needle coke feedstocks infers a degree of thermal stability.

During polycondensation of higher molecular weight radicals, they form an intermediate phase (mesophase). The longer the mesophase remains within an optimal viscosity range, the greater the propensity to develop long-range microstructural order (sometimes referred to as the carbon 'blueprint'). The structural order on a micro-scale (10-6) translates to the crystalline scale (10-10). The crystalline order is that of graphene (sp2 hybridised orbitals) and essentially exists as layers of covalently bonded benzene sheets separated by interplanar spaces. The microstructural and crystalline order determine the electronic and CTE characteristics of both needle coke and consequently graphite electrodes.

Needle coke quality is generally classified into three quality grades (ultra premium, super premium and intermediate premium), the specifications of which are presented in Table 1.

The quality ascribed to needle coke grades is generally characterised by differences in microstructural order, crystalline order, CTE, and impurities. Higher quality needle coke grades are usually associated with larger diameter graphite electrodes. Petroleum-based needle cokes have historically dominated the market; however, all recent expansion initiatives in China are based on coal-tar needle cokes (which have historically been plagued by inconstant quality and problematic electrode graphitisation). A diagram showing highly ordered needle coke microstructure with parallel aligned porosity is shown in Figure 1.

Being a speciality and derived from a by-product, needle coke exhibits a concentrated supply structure. There are around 10 major producers globally, while most refineries do not have delayed cokers (especially those suitable for needle coke production) or calciners. Following delayed coking (450-480°C), the green needle coke is calcined (1350°C) to reduce volatiles and promote microstructural densification.

The science associated with the needle coke value chain is complex and beyond the scope of this discussion, which merely serves to introduce the topic.

Needle coke: a resurgent market
Over the last decade, the appetite for needle coke has diminished, given the abundance of scrap steel emanating from China. This demand decline has exerted downwards pressure on needle coke pricing to under $1000 per tonne. However, in 2018-2020, there has been a resurgence in the demand for needle coke and associated pricing, which, although sluggish, has rebounded with sustained growth. The demand for needle coke is witnessed by the substantial ramp-up of Chinese EAF capacity.

The demand has further been impacted by market diversification based on the exponential growth of the EV automotive sector (needle coke is utilised for the production of synthetic graphite anodes in lithium ion batteries). Competition as an EV battery graphite source is provided by natural graphite, which, while commanding a lower price, is also associated with lower comparative quality (higher natural impurities). The sustained requirement for graphite for the EV market is demonstrated by the fact that the Tesla Model S contains up to 85 kg of graphite.

While the growth of the EV market has been exponential, it has been off a small base. Growth of the EV market is expected to command a 30% automotive market share by 2030. To demonstrate the expected impact of this sector (on needle coke demand), a 6% EV growth would relate to a 250 kilo-tonne per annum (ktpa) demand increase. The comparative demand from the graphite electrode market has historically remained stable at approximately one million tpa.

Competition for the battery market between natural and synthetic (needle coke-based) graphite will depend on a variety of factors. Compared to synthetic graphite, natural graphite is:
- More abundant with a simplified mining process flow
- The inherent ash content is comparatively high, requiring substantial floatation and purification
- The effect of purification to remove impurities may leave voids affecting both microstructural order and density
- Natural graphite purity is linked to price, which has historically been comparatively lower
- Purified natural graphite exhibits a larger BET surface area, which may be associated with the removal of impurities. While this may be beneficial, especially in light of battery applications, both the impurities themselves and their removal introduce crystalline imperfections, limiting electronic performance characteristics.