Hong Kong, July 19, 2007 - Kingboard Chemical Holdings Limited (HKEx: 148) ("Kingboard Chemical") held a foundation laying ceremony on July 18, 2007 for its new coal-based chemical project in Zhongyang County, Lvliang, ShanXi Province, the PRC. The entire project, to be developed in three phases, will include joint-venture operation of coal mining, and coke/methanol production. Investment payable by Kingboard Chemical for the three phases will be RMB 350 million, RMB 850 million and RMB 400 million respectively.
The foundation laying ceremony was hosted by Mr Paul Cheung Kwok-wing, Chairman, and Mr Patrick Chan Wing-kwan, Managing Director of Kingboard Chemical, in the presence of ShanXi provincial representatives.
This integrated development comprises two main operations - coal mining and coke/methanol production. Kingboard Chemical owns 60% stake in the coal mine with investment of RMB 350 million. The coal mine has a coal reserve of 128 million tonnes and a current daily output of 40 tonnes of coking coal. By the first quarter of 2009, volume extraction of coking coal can be achieved with an annual output 900,000 tonnes. This output will satisfy approximately 50% of the total coking coal demand for Shanxi Lvliang coke/methanol production.
The coke/methanol operation will be developed in two phases. Kingboard Chemical owns 80% stake in this joint venture with investment of RMB 850 million and RMB 400 million. The project will include coal cleaning facilities with annual capacity of 4.5 million tonnes, two coking plants with total annual production capacity of 1,800,000 tonnes (2 X 900,000 tonnes), and four 5.5-metre high coking furnaces. The coal cleaning facilities will be ready in the 4th quarter of 2008 whilst the coking furnaces and methanol production facilities will start to ramp up gradually from first quarter of 2009. Methanol production is expected to reach an annual capacity of 200,000 tonnes by the 3rd quarter of 2009. The environmental friendly installations at the methanol plant will enable the re-use and recycling of coke gas emissions.
Mr Paul Cheung Kwok-wing, Chairman of Kingboard Chemcial, said: "This new integrated project with coal mining, coke/methanol facilities at Shanxi is expected to generate attractive return for our shareholders." Similar to our coke/methanol project in Hebei, the Shanxi facilities utilize same pioneering technology which applies emitted coke gas for the production of methanol. This recycling process ensures zero emission of pollutants. Our ongoing commitment to the development of environmental friendly industries and clean production facilities are greatly welcomed and supported by the provincial government authorities of ShanXi."
Kingboard Chemical has a highly vertically-integrated operation with three core business lines: laminate, chemical and printed circuit board (PCB). This integrated coal mining, coke/methanol project is an integral part of the Group's upstream chemical operation, and will be the new growth driver for the Group.
Key Facts of the ShanXi Coal Based Chemical Project:
| Location | Zhongyang County, Lvliang, ShanXi Province, the PRC |
| Annual Production Capacity | Coal mining 900,000 tonnes of coking coal
Coke/ methanol production |
| Site Area | 660,000 sq m |
About Kingboard Chemical
Kingboard Chemical Holdings Limited (HKEx: 148) is a global leader in laminate and printed circuit board as well as a major chemical supplier in China. The Group's core manufacturing capability comprises an integrated network of more than 50 plants in China. The Kingboard Group of companies also includes Kingboard Laminates Holdings Limited (HKEx: 1888), Kingboard Copper Foil Holdings Limited (listed on the Singapore Exchange) and Elec & Eltek International Company Limited (listed on the Singapore Exchange).