en.Wedoany.com Reported - On April 1st, the civil engineering construction tender (Lot 2) for the Phase II of the 5.5 billion cubic meters per annum (bcma) coal-to-natural gas (CTNG) demonstration project of China Xinjiang Qinghua was announced as awarded, with Liaoning Qijun Construction Engineering Co., Ltd. winning the bid. On March 30th, Jovo Energy stated on the interactive platform that the Phase II project is designed for an annual production of 4.0 bcma of CTNG. The core purpose of Jovo Energy's participation in the investment is to secure equity gas resources with cost advantages and stable supply, further improving the layout of its upstream resource pool consisting of "equity gas + long-term contract gas + spot gas".
This investment arrangement was first disclosed by Jovo Energy on September 29, 2025. According to the announcement, Jovo Energy intends to act as an industrial investor to jointly construct the Phase II project with Xinjiang Qinghua and Henan Silk Road. The total project investment is 23.033 billion yuan, of which Jovo Energy's cumulative capital contribution will not exceed 3.455 billion yuan, funded by its own or self-raised capital. Upon project completion, Jovo Energy will hold a 50% equity stake in Phase II, corresponding to an annual entitlement of 2.0 bcma of natural gas resources. This is also a key step in its further extension towards the resource end.
In terms of project composition, Xinjiang Qinghua's CTNG Phase II is located in the Yidong Industrial Park, Yining County, Ili Prefecture, Xinjiang. It is divided into two CTNG series, A and B, which employ different processes but each can produce 2.0 bcma of natural gas. In addition to natural gas, the project will also produce by-products such as tar, middle oil, and crude phenol. On October 21, 2025, Lu'an Chemical Machinery had already won the order for 12 pulverized coal pressurized gasifiers, the core equipment for the gasification section, indicating that the project had already made advanced arrangements for core equipment supply. The award of this civil engineering Lot 2 tender signifies that the construction pace is shifting further from investment finalization to substantive construction.
The advancement of the project is also built upon the mature operation of the Phase I project. After years of operation, Xinjiang Qinghua's Phase I 1.375 bcma CTNG project has matured in terms of safety, process, operation, and cost control, maintaining long-term full-load operation as designed, and has formed a coal chemical management and operation team of over 1,000 people. For Phase II, this means not only readily available operational experience but also a personnel and management system that can be directly scaled up.
From the perspective of resources and export conditions, the Phase II project is expected to consume 11.796 million tons of raw coal annually, mainly sourced from Mine No. 2 and Mine No. 7 in the Yining mining area; the annual water consumption is about 22.316 million cubic meters, and the relevant water intake permits have been obtained. Xinjiang Qinghua had previously built an approximately 43-kilometer gas pipeline to the Yingye'er Township first station of the national pipeline network. Upon Phase II operation, the gas can be connected to the West-East Gas Pipeline trunk network via this pipeline. For Jovo Energy, this 4.0 bcma CTNG project is not just a single investment project but an important pivot connecting its upstream equity gas with midstream pipeline capacity. For the CTNG industry, projects with advantages in coal source, water source, pipeline transportation, and mature plant experience still have a better chance of entering the scale-up stage first.
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