Xinghua Co., Ltd.’s coal-based ethanol production facility has been successfully put into operation, with great potential for further development

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Xinghua Co., Ltd.’s coal-based ethanol production facility has been successfully put into operation, with great potential for further development. Author/Source: Date: 2018-03-12 Clicks: 48 The company released its interim financial results for 2017, showing revenue of 1.894 billion yuan, a 7.05% decrease compared to the same period the previous year； The net profit attributable to the shareholders of the listed company amounted to 206 million yuan, representing a growth of 635.03% compared with the same period of the previous year. This is mainly due to the fact that the company was in a loss-making situation prior to its restructuring in 2016; after the restructuring, its wholly-owned subsidiary, Xinghua Chemical, developed strong profitability, its operations improved, and its performance increased significantly. New owner takes control; the company emerges from adversity: Affected by the weak economy and overcapacity in the industry, the company suffered losses for consecutive years from 2014 to 2015; this was done to ensure the healthy development of the listed company. Yan Chang Group carried out asset restructuring of the company, stripping away the previously loss-making businesses and integrating them into the coal chemical business. The acquisition by Yanchang Petroleum brings advantages in terms of platforms, management, and funding, and the company will make every effort to develop an integrated coal chemical enterprise. The current production capacities of its main products are 300,000 tons per year for synthetic ammonia, 300,000 tons per year for methanol, and 100,000 tons per year for mixed amines/DMF. With supply-side reforms continuing, the company is expected to benefit in the long term: By carrying out technical upgrades, the company has managed to change its coal gasification units from using high-quality coal to using lower-quality coal, and it utilizes coal from the Weibei area that is within a transportation distance of 200 kilometers, thereby **reducing production costs. At the same time, the company has a rational product structure; it has established an integrated circular coal chemical industry chain and possesses comprehensive capabilities for pollutant treatment, enabling it to achieve full production and sales. The company’s main products, such as liquid ammonia, methanol, and DMF, benefit from the advantages brought about by supply-side reforms; as a result, their prices are likely to remain high, allowing the company to reap long-term benefits. Coal-to-ethanol production has been successfully launched, with great potential for future development: The world’s first industrial-scale coal-to-ethanol plant with an annual capacity of 100,000 tons, operated by Yanchang Petroleum Group, is now in operation and has been functioning stably for several months. Ethanol-blended gasoline is currently being piloted in various provinces across the country. Policies stipulate that by 2020, China’s annual consumption of fuel ethanol will reach 15.7 million tons, and there is still a significant gap in production capacity at present. Compared to bioethanol, coal-based ethanol has a significant cost advantage. With the gradual adoption of ethanol-blended gasoline, coal-based ethanol projects hold great development potential.