Synthesis Energy Systems, Inc. SYMX ("SES") announced today that its subsidiary company, SES New Energy
Technologies (Shanghai) Co., Ltd., has entered into a Memorandum of
Understanding ("MOU") with Hongye International Investment Group Co., Ltd.
("Hongye"), for the supply of SES' gasification technology, equipment and
services to Hongye's 600,000 tonnes-per-year glycol plant to be built in the
Inner Mongolia Autonomous Region of China.
The MOU agreement was formally signed yesterday in Los Angeles, California, at
the China Enterprise Council's Seminar on US States - China Provinces Economic
and Trade Cooperation and CEC Annual Meeting. The China delegation was led by
Chairwoman Ms. Bu Xiaolin of the Inner Mongolia Autonomous Region. This is a
region of strategic importance and the center for the development of China's
growing coal-to-chemicals industry as designated in Beijing's twelfth
Five-year plan. This large coal-to- chemicals project will be located in the
Qianlishan Industrial Zone in Wuhai City, Inner Mongolia, China.
Hongye has received pre-approval for this project from the Development and
Reform Commission of the Inner Mongolia Autonomous Region, and further
approvals required to advance the project are currently being sought. The
total project investment is expected to be approximately 9.5 billion RMB, with
construction taking place over a two-year period. Under the terms of the MOU,
Hongye, the largest shareholder of SES, intends to use SES' Gasification
Technology to convert the plant's low quality coal feedstock into syngas,
which will then be converted to glycol.
Additionally, both companies have agreed to work exclusively on this project
for the next 12 months while the technology licensing, equipment supply and
technical service agreements are completed. During this period, Hongye will be
managing the development of the project, including obtaining the remaining
necessary government approvals.
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