Sinopec to lead DME project

China Petroleum & Chemical Corp. (Sinopec), Asia’s largest oil refiner, will lead a five-member venture with China National Coal Group to build a 21 billion yuan (US$2.64 billion) dimethyl ether (DME) project at Erdos, Inner Mongolia. Sinopec and China National Coal will each have a 32.5% stake in the Erdos project. Shanghai power producer Shenergy Group and China Yintai Investment, a Beijing property-to-energy group, will each hold 12.5% while the Inner Mongolia Manshi Coal Group will own 10%. The Erdos plant is targeted to produce 20 million tons of coal, 4.2 million tons of methanol and three million tons of DME annually. It will be complemented by two135-megawatt power generators and a pipeline linking Erdos to Beijing and nearby Tangshan city. The plant is scheduled for completion in 2010. DME, a colourless gas that is liquefied under pressure, is a clean-burning alternative to fuels such as liquefied petroleum gas, liquefied natural gas, diesel and petrol. It is produced from methanol, which is made by gasifying coal. (August 12, 2006)