Overview of the 100,000-ton/year battery-grade lithium iron phosphate project by Inner Mongolia Xingfa Technology Co., Ltd

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I. Basic Information on the Project: Implementing Party and Location: The project is invested and constructed by Inner Mongolia Xingfa Technology Co., Ltd., a wholly-owned subsidiary of Hubei Xingfa Chemical Group. It is located in the Wuda Industrial Park in Wuhai City, Inner Mongolia, covering an area of approximately 76,300 square meters. Investment scale: The total investment amounts to 1.381 billion yuan, with the funds coming from the company’s own capital and bank loans. Construction scale and product applications: A new production line for battery-grade lithium iron phosphate with an annual capacity of 100,000 tons will be built; the products are mainly used in new energy power batteries and as cathode materials for large-scale energy storage batteries ； Simultaneously construct a complete set of auxiliary facilities, including production workshops, raw material and finished product warehouses, power distribution rooms, pure water plants, refrigeration plants, and environmental protection treatment systems. Core process: The industry-standard solid-state carbothermic reduction process is employed, covering the entire workflow from raw material grinding and spray drying to high-temperature sintering, crushing, and packaging. This process is well-established and ensures high product stability. Construction period: The total construction time is 6 months, with commencement scheduled for April 2026 and completion and commissioning by December 2026. Economic benefits: Upon reaching full production, the project is expected to generate an annual output value of 4.5 billion yuan and annual profits and taxes of 200 million yuan, while creating 200 new job opportunities. II. Bidding Details: For the general construction contract, a bidding announcement was issued on February 11, 2026, and the bid opening took place on March 6, 2026. China Chemical Engineering 16th Construction Co., Ltd. won the bid and is responsible for all aspects of the construction work, including civil engineering, main structure construction, and equipment installation. Construction supervision: In February 2026, a tender for construction supervision was launched. MCC Nanfang Wuhan Engineering Consulting & Management Co., Ltd. won the bid and is responsible for quality, safety, progress, and investment control throughout the entire construction process, as well as providing supervision services during the warranty period. Special projects and equipment: From March to May 2026, procurement processes will be carried out sequentially for items such as the atomization system, steel structure works, earthwork and stonework, tower crane leasing, and masonry and plastering work. At the same time, tendering processes will be initiated for key production equipment such as core reactors, sintering kilns, and automated control systems. Tendering agent: The entire tendering process for this project was handled by Hubei Tendering Co., Ltd., with the transaction procedures taking place at the Yichang Public Resources Trading Center. III. Construction Status: Preliminary preparations: As of April 2026, the project has completed all necessary preliminary procedures, including registration, energy efficiency assessments, environmental impact evaluations, safety assessments, permits for land use planning, and construction permits. The site has been leveled and the external utility networks have been constructed, ensuring that all conditions are in place for commencement of construction. Construction commencement: In late April 2026, construction officially began. China Chemical Engineering Sixteenth Construction Co., Ltd., the general contractor, fully mobilized its workforce and initiated the construction of the factory building foundations as well as the erection of temporary facilities. Current progress (as of May 2026): The project is in the peak phase of civil engineering foundation construction, with simultaneous progress being made on earthwork excavation, foundation pouring for the factory building, and the embedding of steel structures ； The specialized subcontractors have arrived one after another, and the various sub-projects such as steel structure construction, masonry work, and the installation of mechanical and electrical components are being carried out simultaneously ； Some of the key production equipment has been ordered, and it will be installed once the main structure is completed; progress is being made steadily toward the goal of starting operations by the end of 2026. IV. Significance of the Project: At the corporate development level, it helps Xingfa Group to establish a complete industrial chain for phosphorus chemicals and lithium iron phosphate new energy materials. By leveraging its advantages in phosphorus resources, the company can expand its business in lithium battery cathode materials, improve its layout in the new energy sector, and achieve a transition from traditional phosphorus chemicals to high-end new energy materials, thereby creating new sources of growth. At the industrial cluster level: it is necessary to address the shortcomings in the production capacity of lithium-ion battery cathode materials in the Wuhai area, optimize the regional structure of the new energy industry, improve the supporting capabilities for new energy storage and power battery industries in western Inner Mongolia, and help to establish an industrial cluster for phosphorus-based new energy materials in this region. In terms of dual-carbon energy: it meets the development needs of China’s new energy vehicles and new energy storage industries, enhances the country’s capacity to produce battery-grade lithium iron phosphate domestically, reduces reliance on imported raw materials, contributes to the high-quality development of China’s new energy industry, and ensures the security of the supply chains in this sector. At the regional economic level: Utilize Wuhai Industrial Park’s existing chemical industry foundation to drive the development of upstream and downstream supporting industries such as local building materials, logistics, and operation & maintenance. This will create new job opportunities, facilitate the transformation and upgrading of local industries, and contribute to the large-scale and intensive development of Inner Mongolia’s new energy industry. At the industry development level: By leveraging the advantages of short construction cycles, it is possible to rapidly increase the production capacity of lithium iron phosphate, thereby reducing the pressure on the supply of high-quality cathode materials in the industry. This helps to reduce costs and improve efficiency in the lithium battery materials sector, and it also contributes to the development of new power systems as well as the achievement of the \"dual carbon\" goals.