Jiangsu Shagang Group enters the overcapacity sector of coal chemicals

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Jiangsu Shagang Group, in a joint venture with Taiwan’s Hetao Chemical Co., Ltd., will invest 2.4 billion yuan in the Taixing Economic Development Zone at the provincial level to build a coal chemical project. In July this year, Shagang Group, Taiwan He Tong Chemical, and Taixing Economic Development Zone signed an agreement to establish Shatong (Taixing) Chemical Co., Ltd., with the aim of building facilities for the deep processing of 600,000 tons of coal tar and 300,000 tons of crude benzene, as well as storage facilities for 300,000 tons of petrochemical products. Jiangsu Shagang Group, one of the top three private enterprises in the country, has formed a joint venture with Taiwan’s Hetao Chemical Co., Ltd., and will invest 2.4 billion yuan in the Taixing Economic Development Zone at the provincial level to build a coal chemical project. Among them, the production lines for the deep processing of 300,000 tons of coal tar and 100,000 tons of crude benzene in Phase 1 will begin construction at the end of this month. "The establishment of this project marks the beginning of Taixing Economic Development Zone’s entry into the coal chemical industry. "Lu Jun, deputy director of the Taixing Economic Development Zone Management Committee, explained that China is relatively short of petroleum resources, and its petrochemical industry is constrained by foreign factors ； China is rich in coal resources, and coal chemical industry focuses on producing clean energy and products that can replace those derived from petroleum chemistry. By integrating this industry with energy and chemical technologies, an emerging sector that combines coal and energy chemistry can be created, which is of great significance for reducing environmental pollution caused by coal combustion and decreasing reliance on imported oil. "Against this backdrop, we hired Gao Shunsong, one of the founders of Jinling Petrochemical, as a recruitment advisor to expand into the coal chemical industry while consolidating the scale of the petroleum fine chemicals sector. "Introduction to the Army. Gao Shunsong is 76 years old this year; he used to be the chairman of the first joint venture between Taiwan Hengtong Chemical and Jinling Petrochemical, and he developed a close friendship with the decision-making team at Hengtong. In July this year, Shagang Group, Taiwan He Tong Chemical, and Taixing Economic Development Zone signed an agreement to establish Shatong (Taixing) Chemical Co., Ltd., with the aim of building facilities for the deep processing of 600,000 tons of coal tar and 300,000 tons of crude benzene, as well as storage facilities for 300,000 tons of petrochemical products. "Coal tar and crude benzene are by-products of steelmaking in steel plants, and they also serve as raw materials for coal chemical industry. "The army stated that the centralized processing of coal tar and crude benzene is in line with the policies aimed at energy conservation, environmental protection, and a circular economy. It not only helps to reduce the discharge of waste residues and liquids from steel mills, thus protecting the environment, but also enables the creation of new industrial sectors, leading to increased economic benefits – it’s a win-win situation. Of the 2.4 billion yuan invested in the Shatong (Taixing) project, 1 billion yuan is allocated to introducing the latest foreign technologies and equipment, ensuring that the production processes are at the international and domestic forefront from the very beginning, while also enabling environmental standards to be met and kept under control. Although still in its initial stage, the Shatong project has attracted 5 downstream coal chemical projects to be established in the Taixing Development Zone; these projects will focus on the development of petrochemical alternatives such as methanol produced from coal, dimethyl ether, olefins, and coal-derived oil. Preliminary estimates suggest that the coal chemical industry in Taixing Development Zone could reach a scale of 10 billion yuan within 3 years, and 30 billion yuan within 5 years. I came across it by chance today, so I’m sharing it with everyone. The cost for the technology alone is 1 billion. . . It’s making money for foreigners; it’s a loss-making deal. Have the restrictions on approving new coal chemical projects been lifted now? Besides, the coal chemical industry is doing poorly right now with severe overcapacity; it’s really hard to understand. Another 600,000 tons are needed. 300,000 tons of crude benzene. Methanol dimethyl ether, etc. Where could there be such a large amount? In the East China region, there should be no shortage of demand for these resource-based products here. As a result, the raw materials of several existing cumene tar processing enterprises in East China will surely be affected. It doesn’t seem necessary, does it? It’s precisely the money that isn’t earned that is spent as if it were money. . . .