China Guodian Acquires 51% of Coal-Mining Group for $284 Million

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Researched by Industrial Info Resources (Sugar Land, Texas)--According to a share-transfer agreement signed in December, China Guodian Corporation (Beijing), one of China's top five power producers, will acquire 51% of Pingzhuang Coal Mining Group shares for $284 million from the Economic Commission of Chifeng City, which owns Pingzhuang Coal. The signing ceremony was held in Chifeng City, Inner Mongolia.

Pingzhuang Coal has an annual coal-production capacity of about 19 million metric tons. After the acquisition, Pingzhuang Coal will be the first coal mine under the control of China Guodian. Pingzhuang Coal was established from the former Pingzhuang Mining Bureau, which was formed in 1959. Pingzhuang Coal currently owns 12 holding enterprises, including Inner Mongolia Pingzhuang Energy Resources Company Limited (Chifeng), a public company listed in Shenzhen Security Exchange, with a total proven coal reserve of 1.67 billion metric tons and an economic exploitable reserve of 780 million metric tons. Pingzhuang Coal could satisfy the coal demand of China Guodian's power plants in the northeastern region and part of northern China.

On the same day as the signing ceremony, Phase I of the Guodian-Chifeng coal-chemical project was officially started in Chifeng. The project has an annual production capacity of 300,000 tons of synthesis ammonia and 520,000 tons of urea with a total investment of $283.7 million. The project is expected to go into operation in 2010. As China Guodian's first coal-chemical, this is an important step for the company in coal-resource development. The project is also important in promoting the utilization efficiency in energy conversion, the optimization of resource allocation, as well as Inner Mongolia's economic development, said Zhu Yongfang, China Guodian's Vice President.

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