Approval granted for water resource assessment for coal-to-gas project in Xinjiang by China Power Investment Corporation

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Recently, the water resources assessment report for China Power Investment’s Huocheng coal-to-natural gas project was officially approved by the Yellow River Water Resources Commission under the Ministry of Water Resources. This represents another significant milestone in the preliminary work for this project, following the approval of the energy efficiency assessment report and the site selection assessment report. To date, the project has completed the preparation of all approval-related documents, with the exception of the approval for the environmental impact assessment report. In March this year, the **Ministry of Water Resources lifted the restrictions on water resource approvals in Xinjiang, and the Yellow River Water Resources Commission began to conditionally undertake the review of water resource assessment reports for certain projects in Xinjiang. With the strong coordination of the autonomous region, the Huocheng coal-to-gas project was successfully included in the list of projects eligible for review of their water resource assessment reports in Xinjiang. It passed the review on the first attempt, becoming the first industrial project in Xinjiang in 2015 to receive approval for its water resource assessment report. In April 2015, the Yellow River Water Resources Commission under the Ministry of Water Resources approved the water resources assessment reports for three coal-to-gas projects in Ordos, Inner Mongolia: the 4 billion cubic meters per year coal-to-gas project operated by Beijing Jingtai Energy, the 4 billion cubic meters per year coal-to-gas project operated by CNOOC, and the 4 billion cubic meters per year coal-to-gas project operated by Hebei JianTou. In March 2013, the Huocheng coal-to-gas project received approval from the National Development and Reform Commission; however, due to the excessive total water consumption in Xinjiang during the 12th Five-Year Plan period, the Yellow River Water Resources Commission under the Ministry of Water Resources suspended the review of water resources assessment reports for that region, which became one of the key factors hindering the approval of the project. Li Zhijian, head of the Energy and Chemicals Department at the Petroleum and Chemical Industry Planning Institute, pointed out that water resources will be the biggest constraint on the development of coal-based chemical industries. It is believed that in the future, the growth of the coal chemical industry will mainly occur in the Ordos Basin area (such as Mengxi, Ningdong, Shaanbei, etc.), the eastern Mongolia region, the Zhundong area of Xinjiang, and the Ili region of Xinjiang. To implement all the existing projects in the Ordos Basin area, an additional 450 million tons per year of water will be needed. Since the water supply in this region comes mainly from the Yellow River, adding another 450 million tons per year to the water demand means that water resources will become extremely scarce under already limited conditions ； Through the construction of water diversion projects in the Zhundong region of Xinjiang, the water needs for the 30 billion cubic meters per year coal-to-natural gas project are currently adequately met; however, there is little potential for building further large-scale coal chemical projects in the future ； The Hulunbuir and Ili regions have relatively abundant available water resources. There are few existing coal chemical projects in Hulunbuir. The annual runoff volume of the Yimin River is around 1 billion cubic meters, and control measures related to water management have been put in place, which is sufficient to meet the needs of large-scale coal chemical projects ； The Ili region is rich in water resources; the annual runoff of the Ili River amounts to about 14.7 billion cubic meters. Currently, the utilization rate is less than 30%, allowing for the construction of several new coal chemical projects.