Synthesis Energy Systems, Inc. (SES) (Nasdaq:SYMX) today announced
that it has entered into an agreement, together with Jiangsu
Tianwo-SES Clean Energy Technologies Ltd. (TSEC), its China joint
venture with Suzhuo Tianwo Science and Technology Co. Ltd.
(formerly known as Zhangjiagang Chemical Machinery Co., Ltd.)
(Shenzhen listing code:002564), with Dengfeng Power Group Co., Ltd.
(DFPG) for a distributed power generation program initially in
Henan Province, China. The first phase of the program will be a
pre-feasibility study for the first of several planned 160 MW
distributed power plants designed to utilize two state-of-the-art
SES XL3000 advanced fluidized bed gasification systems;
gasification equipment provided by TSEC, and four GE model
LM2500+G4 aero-derivative gas turbines and related power generation
equipment. Upon the completion and successful results of the
feasibility studies, and requisite government approvals, the first
cleaner distributed power plant is expected to be built in
Dengfeng. It is intended to serve as a model for additional cleaner
coal distributed power generation projects in Dengfeng (up to 600
MW total), as well as elsewhere in Henan Province and in other
regions of China. DFPG, an industrial conglomerate specializing in
thermal power generation whose products include aluminum, other
non-ferrous metals and cement, and who operates power generation
plants and coal mines in Henan Province, is funding the program and
will serve as the owner and operator of the first project.
"We are pleased to align with Dengfeng Power Group and its
forward-looking Chairman, Liu Yingzhong, to lead the way to bring
cleaner coal distributed power to China with the advanced
capabilities of SES's technology, and to aid the Chinese government
in achieving its cleaner energy development goals, all of which is
consistent with our 'Growth With Blue Skies' initiative," said
Robert Rigdon, SES President and CEO. "We will be moving forward
immediately to complete the initial feasibility studies for what we
believe may be the first of several distributed power plants. Also,
we intend to work with our joint marketing partner, GE, for this
China application to combine the SES technology with the LM2500+G4
aero-derivative gas turbines in combined cycle mode, which we
expect will be similar to our K-Electric, Pakistan project
currently in development."
"SES Gasification Technology is advantaged because of its
efficient capability to produce synthesis gas from locally sourced,
low-cost lower quality coals. When combined with GE's advanced
turbines, this can provide us with an economic and cleaner means to
expand our power production capability using cleaner coal IGCC
power versus older coal burning technologies," said Liu Yingzhong,
DFPG Chairman. "We are hopeful for a successful first project,
which we can use as a showcase and then replicate many times here
in Henan and in other parts of China."
SES's XL3000 robust design is capable of delivering greater
economics by transforming virtually all global coal resources,
including China's, India's and other Asian regions' vast indigenous
supply of low-cost lignite, or brown coal, into valuable synthesis
gas. The XL3000 gasification system is targeted to provide
broad-ranging syngas delivery capability with efficiency and
economy in performance to meet the needs of the wide range of the
world's syngas projects. XL3000 features approximately 250% higher
syngas capacity than previous SES designs with delivery pressures
up to 55 bar pressure, driving lower specific capital costs per
unit.
Advanced SES Gasification Technology produces clean syngas fuel
that is well suited for GE's fuel-flexible, efficient LM2500+G4
aeroderivative gas turbines. GE's LM2500+G4 converts the synthesis
gas into electricity, producing more reliable and cost-efficient
power for smaller- to medium-scale projects. In April 2013, SES and
GE combined forces to jointly market and seek initial customers for
their gasification and aeroderivative gas turbine technologies for
the distributed power market. Together, with regional
collaborators, ISTROENERGO GROUP (IEG) and TUTEN, SES and GE are
advancing the feasibility, engineering and financial evaluation of
a similar turnkey 160 MW power plant offering for K-Electric, a
large electric utility, in Karachi, Pakistan.
SES's clean energy technology and Growth With Blue Skies global
initiative is increasingly sought after in China, and around the
world. Power is one of several global vertical markets for SES's
advanced technology which economically and cleanly converts
virtually all grades of coal (including low rank, high ash and high
moisture coals), biomass and industrial wastes into clean
high-value energy end products, including distributed power,
transportation fuels, industrial fuels, substitute natural gas
(SNG), industrial chemicals, fertilizers and direct reduced iron
(DRI) for steel making. Earlier this month, Aluminum Corporation of
China (CHALCO) (NYSE:ACH) (HKEx:2600) (SSE:601600), China's largest
alumina and primary aluminum producer, awarded SES's China TSEC
joint venture partner an order for three industrial syngas supply
plants, which will utilize seven SES gasification systems.
"We are pleased to add the Dengfeng Power Group projects to our
China project pipeline. We believe the power vertical market can
deliver significant growth in China and other industrializing
regions around the world, where the generation of reliable,
economic and cleaner electricity is a significant need for both
residential and industrial users," said Rigdon.
About Synthesis Energy Systems, Inc.
Synthesis Energy Systems (SES) is a Houston-based technology
company focused on bringing clean high-value energy to developing
countries from low-cost and low-grade coal, biomass and wastes
through its proprietary gasification technology based upon U-GasĀ®,
licensed from the Gas Technology Institute. The SES Gasification
Technology enables Growth With Blue Skies, and greater fuel
flexibility for both large-scale and efficient small- to
medium-scale operations close to fuel sources. Fuel sources include
low-rank, low-cost high ash, high moisture coals, which are
significantly cheaper than higher grade coals, many coal waste
products, and biomass feedstocks. For more information, please
visit: www.synthesisenergy.com.
About Jiangsu Tianwo-SES Clean Energy
Technologies Ltd.
Jiangsu Tianwo-SES Clean Energy Technologies Ltd. (TSEC) is a
joint venture between Synthesis Energy System's wholly owned
subsidiary, SES Asia Technologies, Ltd. and Suzhuo Tianwo Science
and Technology Co. Ltd., formerly known as Zhangjiagang Chemical
Machinery Co., Ltd., on December 11, 2014. The joint venture was
formed in 2014 to bring clean energy technologies and turnkey SES
gasification systems to China and select Asian markets, combining
SES's advanced proprietary gasification technology with the market
reach of one of China's leading coal-chemical equipment
manufacturers. The joint venture's target markets also include
Indonesia, Malaysia, Mongolia, the Philippines, and Vietnam. SES
owns 35%, and Suzhou Tianwo Technology owns 65%, of TSEC.
About Dengfeng Power Group Co., Ltd.
Dengfeng Power Group Co., Ltd. (DFPG), established in 1976 and
also called Dengdian in Chinese short form, is a state-owned
enterprise located in Henan Province, China, and is ranked among
China's Fortune 500 Companies with total assets of 19.4 billion RMB
and annual revenue of 21 billion RMB as of 2013. DFPG integrates
coal production, aluminum manufacturing, power generation, and
waste fly ash for cement production. With over 10,000 employees,
DFPG manufactures 400,000 tons per year of alumina, 200,000 tons
per year of aluminum and aluminum alloys, 110,000 tons per year
aluminum fabrication, 3 million tons per year of cement plus coal
production of 1.83 million tons per year. DFPG also has installed
power generation capacity of over 600 MW, plus additional power
generation capacity in joint ventures in China.
SES Forward-Looking Statements
This press release includes "forward-looking statements" within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. All statements other than statements of historical fact
are forward-looking statements. Forward-looking statements are
subject to certain risks, trends and uncertainties that could cause
actual results to differ materially from those projected. Among
those risks, trends and uncertainties are the ability of our ZZ
joint venture to effectively operate XE's methanol plant and
produce methanol; the ability of our project with Yima to produce
earnings and pay dividends; our ability to develop and expand
business of the Suzhuo Tianwo Science and Technology Co. Ltd. joint
venture in the joint venture territory; our ability to develop the
SES power business unit and marketing arrangement with GE and our
other business verticals, including DRI steel, through our
marketing arrangement with Midrex Technologies, and renewables; our
ability to successfully develop the SES licensing business; our
ability to reduce operating costs; our ability to make
distributions and repatriate earnings from our Chinese operations;
our limited history, and viability of our technology; commodity
prices, and the availability and terms of financing; our ability to
obtain the necessary approvals and permits for future projects; our
ability to raise additional capital, if any, and our ability to
estimate the sufficiency of existing capital resources; the
sufficiency of internal controls and procedures; and our results of
operations in countries outside of the U.S., where we are
continuing to pursue and develop projects. Although SES believes
that in making such forward-looking statements our expectations are
based upon reasonable assumptions, such statements may be
influenced by factors that could cause actual outcomes and results
to be materially different from those projected by us. SES cannot
assure you that the assumptions upon which these statements are
based will prove to have been correct.
CONTACT: MDC Group
Investor Relations:
David Castaneda
Arsen Mugurdumov
414.351.9758
IR@synthesisenergy.com
Media Relations:
Susan Roush
747.222.7012
PR@synthesisenergy.com
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