Fertilizer giant to invest $5b in new Xinjiang project
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Hubei Yihua Chemical Industry Co Ltd, Asia's largest fertilizer producer, will invest 33 billion yuan ($5 billion) in a coal chemical project in the Xinjiang Uygur autonomous region during the next five years, said a senior company executive.
The investment will involve the construction of a 1.2 million kilowatt thermal power plant and projects with an annual production capability of 1.2 million tons of synthetic ammonia, 2 million tons of urea, 1.8 million tons of calcium carbide, 1 million tons of caustic soda, 1.2 million tons of PVC, 2 million tons of semi-coke and 600,000 tons of alumatol, according to a company document obtained by China Daily.
Jiang Yuanhua, chairman of Yihua, told China Daily that the investment is part of the company's effort to accelerate its domestic expansion during the period of the 12th Five-Year Plan (2011-2015).
Altogether the company plans 10 major projects worth more than 40 billion yuan in several western regions, including Xinjiang, according to an earlier statement. Total sales from those projects are expected to exceed 45 billion yuan, it said.
"We will invest more in Xinjiang and promote local people's livelihoods," Jiang said. Around 12,000 workers will be employed at the plant, and 80 percent of those will be locals, which means creating more jobs for the region, which is economically less-developed, Jiang said.
Yihua has now finished the 2.6 billion yuan initial construction in the vast desert in Xinjiang, he said.
The ammonia and urea production lines will come into operation in October next year, and others will be finished by the end of 2012, he said.
Song Zhichen, an energy industry researcher at China Investment Consulting, said that the global economic recovery has led to a continual rise in international oil prices, which will help the development of the coal industry, especially in the field of coal-based chemical production.
The increase in crude prices has also facilitated sustainable energy usage, and a reduction in dependence on imported oil, Song said.
Meanwhile, Shenhua Group, China's largest coal producer and exporter, and Sinopec, the nation's largest oil product producer, have also said that they will increase investment in Xinjiang.
The improving infrastructure and low production costs have made the region more attractive to investors.
Large-scale infrastructure construction in the region during recent years has enhanced production facilities in the coal-related industries, analysts said.
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