BP Makes Significant Capital Injection, Launching Three Strategic Moves in China

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Last weekend, BP suddenly announced that it had signed a series of important agreements at the Great Hall of the People in Beijing, covering areas such as a center for the commercialization of clean energy, world-class acetic acid production, and wind power. Chinese institutions and enterprises that have signed agreements with BP include the Chinese Academy of Sciences, Sinopec Group, and a subsidiary of Goldwind Science & Technology – the leading domestic manufacturer of wind power equipment (140.20, 7.90, 5.97%, StockBar). To date, BP’s business investments in China have exceeded $4 billion. 　　De Kairey, VP of BP Group, President of BP for Asia-Pacific and President of BP China, who attended the signing ceremony, said that BP’s various business and social investments serve the same purpose: to take into account China’s specific conditions, and while providing products to Chinese consumers, to protect and improve the natural environment. 　　Commercialization Center for Clean Energy It is reported that BP has signed a framework agreement with the Chinese Academy of Sciences to prepare a feasibility study report for the establishment of a commercialization center for clean energy. This marks substantial progress in the construction of the Clean Energy Commercialization Center since the two parties signed a memorandum of understanding on August 1, 2007. 　　Under the agreement, BP and the Chinese Academy of Sciences have agreed that the Clean Energy Commercialization Center will rely on advanced business models to integrate various clean energy technologies developed by institutes affiliated with the Chinese Academy of Sciences as well as other domestic and foreign research institutions, including coal gasification (35.72,-1.18,-3.20%, Stock Bar), coal liquefaction, coal chemical processing, combined cycle power generation, carbon capture and storage, and coalbed methane. These technologies will be put into industrial demonstration and commercial use, thereby creating competitive technology integration systems and comprehensive solutions such as coal-based cogeneration. The center is also intended to serve as an international platform that fosters close cooperation among research institutes, enterprises, and other organizations, enhances China’s local technological innovation capabilities, and promotes the market application of technologies such as clean coal conversion, zero emissions of pollutants, and carbon capture and storage. BP and the Chinese Academy of Sciences have also agreed to use the Clean Energy Commercialization Center as a platform for cooperation, in order to support China and the UK in advancing and implementing innovation initiatives aimed at achieving near-zero emissions from clean coal, as well as in carrying out research and development and demonstration applications related to such technologies. 　　Currently, the joint working group is actively working on preparing the project feasibility study report and the joint venture agreement, with plans to establish a clean energy commercialization center by the end of 2008. 　　Expanding acetic acid production and entering the wind power sector On the same day, BP and Sinopec Group also signed a memorandum of understanding to build an additional acetic acid production plant in Chongqing with an annual output of 650,000 tons. This marks another significant advancement in the partnership between BP and Sinopec in the acetic acid sector, following the successful investment in Chongqing Yangtze River Acetate Chemicals’ acetic acid production facility and the current cooperation on the Nanjing BP Yangtze Acetate Chemicals acetic acid project. 　　It is reported that the newly built acetic acid plant will utilize BP’s world-leading patented technology, with an annual designed production capacity of 650,000 tons. The new factory is expected to come online in 2011. 　　Not only that, but BP has also signed a joint venture framework agreement with Beijing Tianrun New Energy Investment Co., Ltd., a subsidiary of Goldwind Science & Technology Co., Ltd., with the aim of jointly investing in the development, construction, ownership, and operation of three 49.5 megawatt wind farms near Baiyun Ebo Town in Inner Mongolia. The two parties have also agreed to explore other wind power investment opportunities in the Inner Mongolia region.