Shanghai Securities News: Yankuang’s coal-to-oil project moves forward

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The last edit to this post was made by jordan569 on 2013-1-6 at 22:46. On February 3rd, a reporter from Shanghai Securities News learned from the Shaanxi Provincial Environmental Protection Department that Yankuang Group’s coal-to-oil project has received approval from the Ministry of Environmental Protection, which indicates that the project will be implemented in Shaanxi Province in the near future. Meanwhile, not long ago, the Ministry of Industry and Information Technology held the third meeting of the coordination and guidance team for the joint commissioning of Shenhua’s \"Direct Coal Liquefaction Demonstration Project,\" urging Shenhua to start formulating a plan for the next phase of operations. It is reported that, on the basis of its successful efforts in developing coal indirect liquefaction technology and catalyst research, Yankuang Group will proceed with scaling up the process to build a 1 million tons per year industrial demonstration project for coal-to-oil production. The project is located in the northern area of the Yuheng Coal Chemical Industry Zone, Qinhe Township, Yuyang District, Yulin City, Shaanxi Province. Once completed, it will have an annual production capacity of 1 million tons of oil produced through indirect coal liquefaction. The main products will be 780,800 tons of diesel per year, 258,400 tons of naphtha per year, and 56,480 tons of liquefied petroleum gas per year. The by-products will include sulfur, nitrates, liquid argon, and gypsum. The total investment amounts to 13.45 billion yuan, of which 650 million yuan is allocated to environmental protection efforts, accounting for 4.81% of the total investment. An article from the Shaanxi Provincial Environmental Protection Department states that the approval of this project represents a concrete manifestation of environmental protection agencies at all levels taking measures to balance different priorities under the current circumstances, fulfilling the seven commitments related to environmental impact assessments, and creating a fast-track approval process with special handling for such cases in order to stimulate domestic demand. With the approval of the project’s environmental impact assessment report, the project now has all the necessary approvals from the relevant regulatory authorities, and it is expected to be implemented in Shaanxi soon. Yankuang Group has continued to push forward with its coal-to-oil project despite widespread controversy. Previously, a senior advisor at the Energy Research Institute of the National Development and Reform Commission told reporters that the investment returns on coal-to-oil projects depend mainly on international oil prices. “It is generally believed that coal-to-oil is attractive when crude oil prices are above $40. ”The expert noted that with oil prices currently hovering around $40 per barrel, coal-to-oil projects find themselves in a difficult situation; as a result, the National Development and Reform Commission issued a directive to suspend certain such projects. “Although it yields little profit in the short term, coal-to-oil projects are of great significance for developing alternative energy sources to oil and diversifying China’s oil supply. ”An analyst told reporters that it is precisely because of the opportunities in the future that companies such as Shenhua, Lu’an, Yankuang, and Yitai have not ceased their efforts to pursue coal-to-oil production. In mid-November last year, the **Key Laboratory for Coal Liquefaction and Coal Chemicals**, for which Yankuang Group invested a total of 240 million yuan, was established in the Shanghai Pudong High-Tech Park. On January 22 of this year, Li Yizhong, Minister of the Ministry of Industry and Information Technology, presided over the third meeting of the Coordination and Guidance Group for the joint commissioning of the Shenhua coal direct liquefaction demonstration project, urging Shenhua Group to prepare a summary of the commissioning process, carry out optimization and modifications, and start formulating plans for the next phase of operations. “The continuous good news in China’s coal-to-oil industry indicates that 2009 will be the year when decisive progress is made in this sector in China. ”Experts from coal chemical research institutions and Shanghai Yahua Consulting told reporters. . Note $ # , $ $