Xinyangfeng Agricultural Technology plans to build a 300,000-ton/year synthetic ammonia plant

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Xinyangfeng Agricultural Technology plans to build a synthetic ammonia plant with an annual production capacity of 300,000 tons. Author/Source: Refining and Chemical Industry Updates. Date: April 9, 2020. Clicks: 21. Xinyangfeng Agricultural Technology Co., Ltd. announced on the evening of March 27 that, in order to enhance the company’s ability to withstand risks and strengthen its core competitiveness in the phosphorus-based fertilizer business, it plans to invest in a project to upgrade its synthetic ammonia production capacity to 300,000 tons per year. The total planned investment for the project is 1.5 billion yuan, with the funds coming from the company’s own resources. The details of the “Proposal on Investing in a Technical Upgrade Project for a 300,000-ton/year Synthetic Ammonia Production Facility” are as follows: I. Project Investment Overview The company has the capacity to produce over 8 million tons of various high-concentration phosphate fertilizers per year. It currently possesses a synthetic ammonia production capacity of 150,000 tons per year; however, its outdated manufacturing processes prevent it from gaining a sufficient cost advantage for its downstream business operations ； At the same time, an annual production capacity of 150,000 tons is far from sufficient to meet the company’s demand for compound fertilizers and monoammonium phosphate. In order to significantly reduce the company’s production costs and external transportation expenses, improve profitability, the efficiency of capital utilization, and return on equity, strengthen the strategic integration of the industrial chain, and enhance the company’s ability to withstand risks as well as its core competitiveness in the phosphorus compound fertilizer business, the company plans to invest in a technical upgrade project for synthetic ammonia production with an annual capacity of 300,000 tons. The total planned investment for the project is RMB 1.5 billion, with the funds coming from the company’s own resources. In accordance with the relevant provisions of the Shenzhen Stock Exchange Stock Listing Rules and the Company’s Articles of Association, this proposal does not need to be submitted to the company’s general meeting of shareholders for review. This investment does not constitute a related-party transaction, nor does it constitute a major asset restructuring as defined in the Measures for the Administration of Major Asset Restructurings of Listed Companies. II. Basic Information on the Project (I) Information on the Project Implementer 1. Company name: Xinyangfeng Agricultural Technology Co., Ltd. 2. Unified Social Credit Code: 91420800764100001A 3. Address: No. 7, Yueyuehu North Road, Jingmen City, Hubei Province (II) Basic Project Information 1. Overview of the project: The total land area covered by the project is 543,652 square meters. The main construction elements include a gasification unit, an air separation unit, an ammonia synthesis unit, a sulfur recovery unit, as well as supporting facilities for waste treatment, along with public and auxiliary engineering facilities such as water supply and drainage systems, power supply and distribution systems, pipelines, transportation systems, and roads. 2. Project location: Dongbao Chemical Recycling Industrial Park, Jingmen City, Hubei Province. 3. Project implementation schedule: The construction period for this project, from the initial design stage to the time when it is completed and put into operation, is planned to be 24 months. III. Impact of Project Construction on the Company The investment in these projects is aimed at meeting the company’s needs for synthetic ammonia as a raw material for the production of ammonium phosphate and compound fertilizers. It helps to reduce the production costs of downstream products as well as external transportation expenses, thereby enhancing profitability, the efficiency of capital utilization, and the return on equity. Such efforts also contribute to improving the company’s integrated industrial chain strategy, strengthening its ability to withstand risks and its core competitiveness in the phosphorus fertilizer industry. They enable the company to further develop and strengthen its core business in phosphorus fertilizers, improving its capacity for sustainable development in the future – all in line with the company’s strategic goals and the interests of all shareholders.