Assuming for a moment that we are in a simulation - then it follows we should be able to show that simulations can produce consciousness.
Or that we should be able to in the future. I don't think anyone is saying it's already possible.
But what are the reasons for suspecting it will not be possible? Only on mystical grounds when you think about it. Consider this thought experiment: imagine the technology existed to replicate your physical body atom for atom including your brain. Would that new being possess consciousness? A committed materialist would surely need to answer yes. To answer otherwise would need to invoke a substance other than the material as being involved in consciousness. If nothing is involved in consciousness other than the material, then it follows that the ability to minutely engineer matter will result in the ability to replicate consciousness. If you say there is more to consciousness than replicating its material conditions then you are not a materialist!