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Fengxi Fenghe’s Rebirth – Author/Source: Sales Company of Yangmei Chemical Industry Co., Ltd. Date: 2022-01-11 Clicks: 20 Shanxi Fenghe Melamine Co., Ltd. (hereinafter referred to as “Fenghe Company”) was established on January 25, 2008, through joint investment by Shanxi Fengxi Fertilizer (Group) Co., Ltd. (now Lu’an Chemical Fengxi, hereinafter referred to as “Fengxi”) and DSM Melamine Co., Ltd. (now Oxea China Holdings Co., Ltd., hereinafter referred to as “Oxea”). It is currently the only Sino-foreign joint venture in the field of melamine production in China. In 2021, Fenghe Company managed to make a miraculous comeback from the brink of collapse, thanks to its proactive approach, ability to seize opportunities, and a strong sense of responsibility and mission that drove it to prioritize ensuring the company’s survival above all else. In 2021, the company managed to stay afloat, achieving a total profit of 50 million yuan for the whole year. The profit generated per person is 400,000 yuan. Elimination of coal-fired boilers and full resumption of production: In 2020, in order to win the battle to protect the blue skies, Shanxi Province carried out comprehensive reforms regarding boilers. By the end of June 2020, the company eliminated two of its coal-fired molten salt furnaces; in October of that same year, the P1 and P2 melamine production lines at Fenghe Company were shut down. During the period of suspension of operations, Fenghe Company conducted extensive consultations, research, discussions, and developed practical alternatives to coal use. Starting with alternatives to traditional coal as fuel sources, the company actively sought fuels suitable for operating molten salt furnaces. Biomass fuel not only enabled the factory to resume operations in a short time but also met the emission standards required. It took just over a month from the initial research and feasibility studies related to upgrading the molten salt furnaces, through the development of plans and proposals, applications, and approvals, to the actual bidding process for implementing the project. The project to upgrade biomass fuel utilization in molten salt furnaces is a first of its kind in the national industry, with no precedents to follow. On March 14, the company resumed operations. Due to changes in the properties of the fuel and a decrease in the melting point of the ash (the melting point of bituminous coal ash is 1020°C, while that of biomass ash is around 800–900°C), the salt tubes in the molten salt heating furnaces became clogged. As a result, the operating cycle of the molten salt system was reduced from 40–60 days to about 20 days, which required thorough cleaning of the salt tubes and thus hindered the operation of the entire system. Fenghe Company adheres to a system of having managers work alongside and supervise the staff, collecting data during operation and summarizing experiences to gradually develop a set of temporary operating procedures for running molten salt furnaces with biomass. In May, P2 followed the approach used by P1 and, building on that relative success, organized personnel to carry out technical upgrades to P2, enabling the successful use of biomass fuel; as a result, the two melamine production lines at Fenghe Company were able to resume operations, albeit with some difficulties. Gas conversion and cost analysis played a key role in enabling two workshops to resume operations using biomass fuel. However, due to the inherent drawbacks of biomass fuel, the system’s capacity cannot be fully utilized, and the operation cycle is shortened; as a result, the quality of the products is not consistent, workers face high physical strain, and safety risks increase. In order to address the problem at its root, Fenghe Company conducted repeated consultations and discussions with manufacturers of molten salt furnaces, designers, and related organizations, and studied in depth the relevant technologies related to gas-fired square molten salt furnaces. After conducting a cost analysis, it was determined that the time was right to use natural gas. By modifying the molten salt heating furnace using gas, without changing the existing molten salt furnace, this approach is unique in the country – it represents an innovative solution, as it is one of the first attempts of its kind, and it meets the requirements of green, low-carbon, and environmentally friendly practices. The staff of Fenghe, together with the manufacturers responsible for the renovation, worked together to complete the modifications. In October 2021, the gas conversion was carried out first at P2; the ignition was successful on the first attempt, and the facility was put into operation smoothly, with all key parameters related to raw material consumption meeting the expected levels. At the beginning of November, technical upgrades were also carried out on P1. Considering the shortage of gas supply during winter, the company decided to continue using a mixture of natural gas and biomass in workshop P1; the system operated stably, and all consumption levels returned to their normal historical values. The company continuously makes decisive decisions in line with changes in circumstances, and small-scale technological upgrades yield significant benefits. The total investment in such upgrades did not exceed 3 million yuan; stable production was achieved in a short time, allowing the company to reach the industry average level of viability. By seizing the golden period of the market, it was able to accumulate funds rapidly and maintain stability within its workforce. Lean management: building up strength gradually. Melamine is a high-end, sophisticated product that features low energy consumption and low carbon emissions, which aligns with Lu’an Chemical’s strategic goals and the direction of its industrial development, as well as with relevant industry policies. The company made full use of the management and resource strengths of both sets of shareholders, effectively utilized the local conversion of urea by the Fengxi Group, and received technical and managerial support from OCI’s shareholders (OCI is a world-class chemical company that was among the first in the world to develop urea and melamine; it boasts strong technical and R&D capabilities as well as a highly developed overseas sales network), thereby achieving a result where 1+1>2. Over the years, Fenghe has consistently adhered to foreign management concepts and software tools, focusing on the use of CMMS/AU/HAZOP tools. The CMMS preventive maintenance software requires that each repair be entered into the software; by analyzing the patterns of equipment repairs over time, it ensures the long-term safe operation of the equipment ； The AU Excellent Manufacturing Analysis Tool involves entering key process metrics into the system; it adopts a problem-oriented approach and uses structured thinking to identify the factors that impact performance such as production volume, thereby addressing the issues at their root ； HAZOP is a hazard and operability analysis tool that identifies, analyzes, and evaluates hazards in production facilities from a systematic perspective, providing recommendations to enhance the safety and operability of the facility’s processes. Especially during the manufacturing process of the P1 reactor, foreign experts supervised the entire production process, and to this day the equipment is operating well. It is thanks to these years of consistent management efforts that Fenghe’s consumption of urea in the production of melamine, as well as its operational efficiency, are on par with those of similar companies in the industry; all aspects of its management are at a high level compared to industry standards. In terms of quality control, OCI’s quality management processes and systems are adopted; grading and classification follow international standards that are even higher than national standards. P1 products boast excellent quality stability, which makes them highly popular among premium customers. Fenghe Company has also hired multiple external experts to form a strong technical advisory team, which has helped the company resolve various complex issues on numerous occasions. There is Ding Zehua, a pioneer in the design of one-step processes under normal pressure in China; Dr. HARRY from OCI, one of the world’s top experts in melamine technology; and Qiu Fuguo, a professor of expert level who was among the first in China to introduce and improve foreign melamine technologies for domestic use. Through years of effort in management and operation, Fenghe has now developed a team of skilled professionals in the field of melamine production; this team represents the company’s hidden asset and the key to helping the company overcome difficulties. High-end and diversified: Future prospects. Under the current dual-carbon goals, in line with Lu’an Chemical Group’s overall development strategy, it is necessary to reposition the melamine production at the Pinglu base. The plan is for the Pinglu branch and Fenghe Company, based on their combined annual production capacity of 60,000 tons, to focus on sustainable development. By collaborating with experts at home and abroad to make breakthroughs in key technologies (such as new types of gas-solid fluidized bed technology), they aim to expand their melamine production capacity to 120,000 tons per year, thereby becoming one of the most competitive suppliers of melamine in the world. Building on this success, they intend to develop an integrated fine chemical park that covers all aspects of the melamine industry chain.