China's Xin'ao Group to Start First Phase of Dimethyl Ether Project in Jiangsu

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Researched by Industrial Info Resources (Sugar Land, Texas)--China's Xin'ao Group will start a 200,000-ton-per-annum (TPA) dimethyl ether (DME) factory by the end of October in Zhangjiagang City of Jiangsu Province. This is the first phase construction of Xin'ao's 1 million-TPA project in the Jiangsu Yangtze Chemical Industrial Park. Xin'ao had $80 million in plan for the whole project of which $67.8 million is invested for construction. Construction began in May, and planned construction is expected to last two years.

Xin'ao set up a new company, Xinneng (Zhangjiagang) Energy Company, to manage the new factory. The product will be mixed with natural gas to be used as a domestic cooking gas.

Methanex Corporate (Vancouver, Canada) acquired 20% shares of the Zhangjiagang factory after signing a long-term agreement at the end of last year, to make Xin'ao a provider of cheap alcohol.

Xin'ao Group (Langfang City, Hebei Province) was established in 1989. It has started other DME projects in Shantou City and Erdos City.

In August, Xin'ao signed an agreement with Longpeng Combustible Gas Development Company, a Shantou (Guangdong Province) company, to jointly invest $92.1 million to build a 600,000-TPA DME project in the city. They planned to invest $26.3 million in the first phase of construction (200,000-TPA) and in the second phase of construction.

In Erdos City of the Inner Mongolia Autonomous Region, Xin'ao had finished a 400,000-TPA, $315.8 million DME project at the end of 2006.

Xin'ao's businesses include energy development, energy chemicals and energy distribution. It has more than 100 subsidiaries and offices in more than 60 cities in China and overseas, including the U.S., England and Australia.

In Zhangjiagang City, a 1 million-TPA DME project invested by Shandong Jiutai Chemical Industry Technology Company Limited (Linyi City, Shandong Province) will be finished by year's end.

In June 2006, China's National Development and Reform Commission (NDRC) proposed to use DME as an alternative form of energy and welcomed more investment into the area.

According to analysts, China's annual DME production capacity will reach 150 million tons in 2010.

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