Yankuang Restarts Listing Efforts for Coal Chemical Assets       

Yankuang Group is ready to restart the effort to list its coal-based chemical business, which has been postponed for a year because of the financial crisis.
   Shandong province based Yankuang Group consists of three business units: coal, coal-based chemicals and aluminum. The coal assets have been injected to listed Yanzhou Coal Mining Co. (SH: 600188). "The group plans to solely list its coal chemical business through an initial public offering," a company source said.
    "We intend to launch the IPO by using the Yankuang Lunan Fertilizer Plant as a platform," he added. Lunan Fertilizer, based in Tengzhou city in Shandong province, has an annual production capacity of 800 000 tons for urea, and 150 000 t/a for methanol.
   Yankuang Group produced about 3.5 million tons of coal-based chemicals in 2008, including 1.105 million tons of urea, 603 800 tons of methanol, 270 000 tons of acetic acid and 1.404 million tons of coke.
   This year, the group plans to build a Lunan chemical zone, focusing on coal gasification and polygeneration system.
   Yankuang has formed a joint venture with Cathy Coal Chemical Holding Co., Ltd. of the United States in Zaozhuang, Shandong province, for coal chemicals. The venture, Yankuang Cathay Chemical Co., Ltd., has started operation on its first phase 200 000 t/a acetic acid unit and completed a technical upgrade project on a 100 000 t/a acetic acid unit. Construction on its second phase 300 000 t/a acetic acid plant and a 100 000 t/a ethyl acetate plant has also completed. And on April 18th this year, Yankuang Cathay broke ground for its third phase 400 000 t/a acetic acid project (CCR2009 No. 14), which, upon completion, will make Yankuang Cathay the leading acetic acid manufacturer in China.
   Meanwhile, Yankuang Guohong Chemical Engineer Co., Ltd., another subsidiary owned by Yankuang, has started up a 500 000 t/a methanol project in Zoucheng, Shandong province, and the second phase - 1 million t/a methanol is ready for construction.
    Zoucheng-based Yishan Chemical Co., 51.6% owned by Yankuang, started construction on a 200 000 t/a plant for DMF (dimethyl formamide) in December 2008.
   Yankuang International Coking Co., Ltd. (a 70: 25: 5 joint venture between Yankuang, Brazil's CVRD and Japan's ITOCHU), based in Jining, Shandong province, has an annual capacity of 2 million tons for coke, 200 000 tons of methanol and 100 000 tons of coal tar in operation.
   In addition, Yankuang has coal chemical operations in other provinces and region including Guizhou, Shaanxi, and Xinjiang.
   Yankuang Guizhou Energy Chemical Co., Ltd. is preparing for 500 000 t/a synthetic ammonia project in Kaiyang, Guizhou province.
   Yankuang is also operating a 600 000 t/a methanol project under trial run at its energy and chemical base in Shaanxi province, and preparatory work on the second phase of 1.8 million t/a has also started. Another planned 1 million t/a coal-to-fuel project is now being assessed by the National Development and Reform Commission.
   In Xinjiang, construction on Yankuang Xinjiang Coal Chemical Co.'s 600 000 t/a synthetic ammonia and methanol integrated project started in November 2008 in the Ganquanbao industrial zone in the Urumqi high-tech zone.
   The 100 000 t/a methanol project by Yankuang Shanxi Tianhao Chemical Co., whose construction started in 2005, produced 16 900 tons of methanol in 2008, that Yankuang source said.
   Yankuang Group aims to boost sales revenue from its coal chemical business to RMB25.84 billion by 2010, exceeding its current flagship coal business.