Phase I Construction of Dimethyl Ether Project in Chinese Province Nears Completion

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Researched by Industrial Info Resources (Sugar Land, Texas)--Shandong Jiutai Chemical is scheduled to finish construction of the 300,000-ton-per-annum Phase I of its dimethyl ether (DME) project by the end of the year in Jiangsu Province's Zhangjiagang City and will begin construction on Phase II shortly after. Shandong Jiutai Chemical Industry Technology Company Limited (Linyi City, Shandong Province) has invested in the 1 million-ton-per-annum (TPA) DME project in Zhangjiagang City and established its Zhangjiagang subsidiary to manage it. The plant's products will be mixed with natural gas to be used as domestic cooking gas.

The factory covers 150,000 square meters in the Jiangsu Yangtze Chemical Industrial Park. Construction began in April. Jiutai and China Energy Corporation (Miami, Florida) jointly invested $48.7 million in the first phase of which Jiutai's investment covers 55%.

Ten days before the Zhangjiagang project's foundation was set, Jiutai signed an agreement to start another 1 million-ton alcohol and DME project in Inner Mongolia. Jiutai prepared $855.3 million for the Inner Mongolian project, which will go into operation in 2010.

In 2006, Jiutai signed an agreement to invest $657.9 million to build a 3-TPA DME project in Tianjin.

Another 1 million-TPA DME project by Xin'ao Group (Langfang City, Hebei Province) in Zhangjiagang will go into operation soon.

Jiutai, a privately held company, was established in 2002 with $51.3 million registered capital. It is located in the Luozhuang Industrial Park of the Linyi High-tech Industrial Development Zone in Shandong Province. Its major products are DME and carbinol.

Jiutai built its first DME project, a 30,000-TPA project, in January 2003 and started a 100,000-TPA project in January 2004. Jiutai's annual capacity was 150,000 tons of DME and 250,000 tons of alcohol in April 2007.

In June 2006, China's National Development and Reform Commission (NDRC) proposed to use DME as an important substitute energy and welcomed more investment in the area. Jiutai received $9.6 million from the NDRC in January 2007.

Analysts predict that China's annual DME production capacity will reach 150 million tons in 2010.

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