In our previous work, a new concept of annular catalyst cooler (ACC) was proposed and validated experimentally, which showed that an internal circulation of solids could be formed by using two gas distributors and both hydrodynamics and heat transfer could be largely improved. The current work simulated detailed hydrodynamics of gas-solids flow to advance our understanding of the ACC by using the two-fluid model. The influences of effective particle diameter d(p)(*) and specularity coefficient phi were examined and compared with experimental data. Optimum values of d(p)(*)= 170 mu m and phi= 0.3 were determined and used in the simulations. Detailed hydrodynamics of gas-solids flow were then obtained, and the influential parameters were examined. The results showed that the proper selection of the ratio of gas velocities and the position of the heat transfer tube were needed to form a stable internal solids circulation in the ACC. The ACC had a combined hydrodynamic feature of up-flow and down-flow catalyst coolers with bigger solids volume fraction and smaller particle resident time, which are beneficial for improving the heat transfer between solids and wall. (C) 2016 Elsevier B.V. All rights reserved.