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SinoCoking Commences Construction of New Coking Facility
03/12/2010 - SinoCoking Coal and Coke Chemical Industries, Inc. recently broke ground on the construction of its new coking facility in Pingdingshan city, in Henan Province, China. The facility will have an anticipated maximum annual production capacity of 900,000 tonnes of coke.
SinoCoking Coal and Coke Chemical Industries, Inc. recently broke ground on the construction of its new state-of-the-art coking facility in Pingdingshan city, in Henan Province, China.
The new coking facility, which will cost an estimated $70 million to complete, is expected to launch production of metallurgical and chemical coke, coal gas, and various chemical products by early 2011. The facility will have an anticipated maximum annual production capacity of 900,000 tonnes of coke.
SinoCoking management projects that if completed as planned, the new facility could result in a five-fold or more increase in the company’s annual coke production and sales volume from the fiscal year 2012 and beyond, compared to current levels.
SinoCoking presently relies on its three parallel WG-86 type coke ovens, which have certain technical limitations. The company’s current facilities have a production capacity of up to 250,000 tonnes per year.
The new coking facility will be capable of utilizing a broader range of coal inputs compared to the company’s existing plant, with even lower thermal properties (a G-index as low as 50). Since the average cost of inputs will decrease, SinoCoking expects to be able to produce coke at a better profit margin.
The new facility is expected to generate an additional 66.5 million kW-h of electricity each year from the conversion of heat emitted from the coal-gas powered system, which is used to power steam generators. The facility will also produce purified coal gas as a fuel source for use by city residents. SinoCoking notes that these two byproducts could result in an additional estimated $43 to $62 million in projected incremental revenue per year, based on current energy prices and currency translation rates.
SinoCoking also anticipates that the new coking facility will expand its product portfolio, enabling it to offer other products such as crude benzol, sulfur, and ammonium sulfate.
“We view this as a key step in the implementation of our growth strategy,” said Jianhua Lv, Chairman and Chief Executive Officer of SinoCoking. “Power and fuel scarcity, as well as environmental side effects of industrial growth, are key issues in China today. Our new coking facility project helps to address these issues, and that is why our project is strongly supported by our local and provincial governments. Furthermore, the completion of this project would enable us to produce our coke products with even greater efficiency, and will provide expanded revenue opportunities to SinoCoking. We look forward to the completion of this project, to further solidify our leadership position in the regional market.”
SinoCoking Coal and Coke Chemical Industries, Inc., a Florida corporation, is a supplier of the vital commodities of thermal and metallurgical coal and coke to industrial users such as power plants, steel mills, plant and factory operators and manufacturers in China. The company is a vertically integrated processor that uses coal from both its own mines and that of third-party mines to provide basic and value-added coal products to its customer base. SinoCoking began producing metallurgical coke in 2002, and since then has expanded its production to become an important supplier to regional steel producers in central China. The company currently has mining rights and capacity to extract 300,000 tonnes of coal per year from mines located in the Henan Province in central China.
