Market Overview

SinoCoking Provides Business Update

SinoCoking Coal and Coke Chemical Industries, Inc. (NASDAQ: SCOK) today provided a business update relating to the construction of its new coking facility and coal mine production.

Coking Facility Update

As previously announced, the Company had already completed the construction of the shallow foundation, an underground workshop, the coke oven and chimney rack for its new coking facility. More recently, the Company completed the construction of the coking ovens and coking chambers, which are the heart of the facility, although at a slower pace than anticipated. Severe rain during the months of September to November required the building of rain- and wind-proof sheds or canopies, which then enabled the Company to complete the construction of coking ovens through the inclement weather.

Additionally, SinoCoking has completed the construction of the quench tower, which is also a key element of the facility. The quench tower is designed and engineered to cool high temperature exhaust gases to the saturation temperature using water vapor, a process during which efficient cooling and cleaning of the gases can be achieved.

The Company has made significant progress on the construction of the coke blending and screening portions of the facility. Following equipment installation and testing, the Company will begin its work on the by-product recovery portion of the facility (i.e., benzene, tar and thiamine).

The Company plans to provide updated pictures of the construction of the coking facility in early January 2012.

Mining Activities

Due to an accident at one of the mines owned by Yima Coal Group, a state-owned enterprise and one of the six provincial level consolidators in Henan, all mid-scale mines are required to undergo mandatory safety checks and inspections by relevant authorities before receiving clearance to resume coal mining operations. This requirement applies to all SinoCoking mines, including Hongchang and Xingsheng coal mines which were previously awaiting governmental confirmation to resume operations. At present, the Company expects to receive clearance for its four coal mines in spring 2012.

SinoCoking's Chairman and CEO, Jianhua Lv noted, "We are disappointed that factors beyond our control caused delays in the completion of the new coking facility and the resumption of coal mining operations at full capacity. We have a dedicated team of construction workers, technicians and engineers who are working around the clock to expedite the construction of the coking facility and we will continue to provide investors with updates until construction is completed. Additionally, we are working closely with authorities in hopes that the permits and clearance notices for our four mines can be expedited so that we can resume coal mining operations at full capacity as soon as possible."

Posted-In: News Guidance Commodities Markets

 

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