Operation status of coal-to-gas projects
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Does anyone familiar with the operations of Xinjiang Qinghua coal-to-gas project in recent years know anything about it? Please let me know, thanks. It would be best to have last year’s production figures and profit details.
The production volume is around 1.1 billion cubic meters; in the first half of the year, the operations were affected to some extent due to other factors, and details regarding profitability remain confidential.
As of 2016, there were three coal-to-natural gas projects in operation in China: the 4 billion cubic meters per year coal-to-natural gas project operated by Datang International Kesiketeng Coal-to-Gas Co., Ltd. in Keqi County, the 2 billion cubic meters per year coal-to-natural gas project operated by Inner Mongolia HuiNeng Coal Chemical Co., Ltd. in Ordos, and the 5.5 billion cubic meters per year coal-to-natural gas project operated by Xinjiang Qinghua Energy Group Co., Ltd. in Ili. The total production capacity of the projects that are already in operation is 3.11 billion cubic meters per year (1.335 billion cubic meters from Datang Keqi, 1.375 billion cubic meters from Xinjiang Qinghua, and 400 million cubic meters from Inner Mongolia HuiNeng). In July 2016, the listed company Datang International Power Generation Co., Ltd. transferred four coal chemical assets, including the Keqi coal-to-natural gas project, to Zhongxin New Energy Chemical Technology Co., Ltd. for 1 yuan each. At the end of 2016, Datang Group introduced two strategic investors to Sinocne Energy Technology Co., Ltd.: China State Asset Management Corporation and China Chengtong Holding Group Co., Ltd. The reason why Datang Group reluctantly divested its coal chemical business is that the coal-to-gas projects it has been working on for years still fail to generate any profits. The first phase of Qinghua Group’s coal-to-natural gas project, with an output capacity of 1.375 billion cubic meters per year, which came online in December 2013, has performed well. The facility has remained in stable operation under high load, with the production capacity exceeding 80%, and the monthly output approaching 100 million cubic meters. Nevertheless, it is estimated that the production cost of Qinghua’s coal-to-natural gas project is 1.6 yuan per cubic meter. After the National Development and Reform Commission reduced the maximum price for non-residential gas use by 700 yuan per thousand cubic meters as of November 20, 2015, the profit margin was **reduced**. (Excerpted from China Coal Chemical Industry, for reference)