China Huaneng Accelerates Deployment into Western China

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Researched by Industrial Info Resources (Sugar Land, Texas)--China Huaneng Group Corporation (Beijing), the largest power producer in China, signed the Share Transfer Agreement with Shaanxi Provincial Investment Corporation (SPIC) (Xi'an) on November 27, 2007, to acquire 60% of Qinling Power Generation Company Limited (Shaanxi). Before the signing ceremony, China Huaneng President Li Xiaopeng, Party Secretary Zhao Leji and Shaanxi Gov. Yuan Chunqing met to discuss extended cooperation with Shaanxi Province in the energy sector.

According to the agreement, China Huaneng will also acquire a 60% stake in the Qinhua Electric Power Company Limited (Shaanxi) in which it doesn't already have interest. Upon the completion of the transfer, China Huaneng will acquire control of the 1,050-megawatt (MW) Qinling Qinhua Power Plant.

This year, China Huaneng acquired 40% of Qinling Power. This share transfer is the extension of the result in the nation's electric power system reform.

The Qinling Qinhua power plant is the first large thermal power plant of its kind with an installed capacity of more than 1,000 MW. The plant comprises two parts: the four 200-MW units owned by Qinling Power, and the two 125-MW units owned by Qinhua Electric.

China Huaneng is the largest power producer in China with 87 power plants in 23 provinces (cities or autonomous regions) with a total installed capacity of 66,870 MW, accounting for about 10% of China's total installed capacity. China Huaneng's power plants are mainly concentrated in eastern China. After a shift in supply and demand in eastern China, along with increasing competition between power generation groups, China Huaneng is turning part of its focus to the central and west regions.

The company has been improving its regional layout and is implementing strategies to move west, Li Xiaopeng said. As part of the plan, the unveiling ceremony for Huaneng Ningxia Energy Company Limited (Yinchuan), a company jointly invested China Huaneng (60%) and Ningxia Power Generation Group Corporation (40%) (Yinchuan), was held on November 26, 2007, in Yinchuan, the capital of Ningxia Autonomous Region.

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