Kingboard and Jinniu to jointly construct coal chemical project.

"Hong Kong Kingboard Chemical Holding Ltd. (0148. HK) and Hebei Jinniu Energy Resources Co., Ltd. (Jinniu, SZ: 000937) intend to jointly build a coal chemical facility", China Securities said on March 20th, 2007.

The facility will produce 1.8 million tons of methanol per year and 1 million tons of coke per year as well as 50 000 tons of crude benzene per year with a total investment of approximately RMB4.5 billion. Its equity split is 60:40, between Kingboard Chemical and Jinniu.

Jinniu plans to list its fourteen mines businesses in Hong Kong stock market and the fund raised will be used in this facility.

The facility is expected to be finalized by the end of 2007.

Located in Xingtai, Hebei province, Jinniu is a large-scale state-owned coal company focusing on coal, power, iron and steel, chemical, machinery and construction material businesses.

Kingboard Chemical started its chemical business in 1997, producing methanol and formaldehyde. The company spun off its laminates unit in December 2006. (CCR2006 No. 34)

In Xingtai of Hebei province, northern China, Kingboard has two plants--Kingboard (Hebei) Coking Co., Ltd. and Kingboard (Hebei) Chemical Co., Ltd. Kingboard (Hebei) Coking is engaged in the production of coke. Kingboard (Hebei) Chemical focuses on the production of methanol using coke oven gas--byproduct of coke manufacturing, as raw material.