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March 08, 2006

China Focus: China aims to convert coal into ultra-clean energy resource

(Comtex Energy Via Thomson Dialog NewsEdge)BEIJING, Mar 8, 2006 (Xinhua via COMTEX) -- China's central government, research institutions and enterprises are pitching in a joint
effort to convert the country's rich coal reserves into a clean
energy resource by using clean-coal technology.

Sun Yuhan, head of the Institute of Coal Chemistry (ICC) under
the Chinese Academy of Sciences (CAS), said that multi-product
production embodies the future of China's development of
clean-coal technology (CCT).

The transformation of coal into "oil" or other high value-added
chemical byproducts via liquidization and gasification to produce
clean fuels is still not well applied in China.

According to an ambitious national plan for China's science and
technology development published in early February, China will
prioritize the development of industrial energy-saving, clean and
efficient use, and the multi-product production of coal in the
coming 15 years.

China also plans to develop a technique for sealing up carbon
dioxide generated in coal combustion to achieve near-zero
emission.

For the time being, its CCT technology is not mature enough to
catch up with the world level. China's CCT reserve, however, ranks
among the first in the world, according to Sun.

Experts predict that China can develop its own coal fueled
gasification technology with its own intellectual property rights
in five years. The end product is said to be 50 percent cheaper
than similar international products.

Chinese companies have also been actively involved in a
research and pilot scheme of CCT. Construction has started in
coal-rich Shanxi Province by the Shanxi Luan Group on a massive
coal liquidization project to get oil from coal.

Meanwhile, the China Huaneng Group, the country's largest
coal-fueled power generator, has joined a coalition of global
electric utilities and coal companies that is to design, construct
and operate the world's first "zero-emission" coal-fueled power
plant.

China is among the world's largest coal consuming nations with
its coal use expected to reach 2.9 billion tons in 2020.

China has the world's third largest coal reserve base and more
than 60 percent of the China's energy still comes from heavily
polluting coal.

"Loss from coal combustion each year costs about four percent
of China's gross domestic product (GDP)," Sun said.

The United States has launched an initiative, dubbed "Vision
21", for developing the technology essential for ultra-clean, near-zero emission, fossil fuel-based energy plants that will be
needed in the coming decades of the 21st century.

Global energy major, British Petroleum, the U.S.-based Texaco
Corp., and Air Products, Inc. are currently working on
breakthroughs in core technologies and integrated innovations in
coal production.

The Chinese firms tend to be more enthusiastic about the
"efficient" use of coal than its "clean" usage, as efficiency
means lower operating cost for the profit-driven companies, according to Sun.

"Stricter laws and regulations on environmental protection and
energy conservation should be enacted to boost CCT technologies
and be used in China's privately owned enterprises," Sun said.
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