Against the backdrop of soaring international oil prices, the Ningdong Energy and Chemical Industrial Base in northwest China's Ningxia Hui Autonomous Region has attracted interest from more and more foreign investors with its ambition to develop its coal-to-oil conversion project.

China Shenhua Energy Co Ltd and South African Sasol Ltd are studying the feasibility of building a large coal-to-oil conversion plant in the industrial base, announced Pat Davies, chief executive officer of Sasol earlier this month.

When constructed, the plant will not only increase the supply of clean fuel, but also create more than 15,000 job opportunities and bring about several billion yuan in profits to east Ningxia, according to sources from China Shenhua Energy.

Davies said the study is scheduled to be completed next year and the project is expected to start operations in 2016.

The site of several key projects of industrial conglomerates, including China Huaneng Corp and Shenhua Ningxia Coal Industry Group Co Ltd (SNCI), the mega-scale industrial center is set to be Asia’s largest energy and chemical industrial base in 2020 when it completes its second-phase infrastructure construction, said Zhang Wenjiang, board chairman of SNCI.

Currently the only commercial producer of coal-to-oil conversion technology in the world, Sasol has long showed an interest in China, which has the world's third-largest coal reserves.

(China Daily July 21, 2008)