King Stone eyes fivefold capacity boost
King Stone Energy Group, a chemical and optical products maker diversifying into coal mining, plans to grow its coal output capacity fivefold by developing existing mines and through acquisitions.
The company aims to spend 452.9 million yuan (US$ 66.4 million) to raise the capacity of its first mine near Ordos, Inner Mongolia Autonomous Region, to 6.5 million tonnes by the end of next year from 1.2 million tonnes now and four million tonnes by the year’s end.
Chief executive Wang Dayong yesterday said that the company was constructing a second mine next to the first one, with an initial capacity of 1.2 million tonnes.
The planned addition of a third mine, with a capacity of 1.2 million tonnes, would raise the company’s capacity to nine million tonnes by the end of 2012, he added.
King Stone is in talks with the local government to acquire mining rights for the third mine.
The company plans to make mine acquisitions this year and next year with a view to raising its coal output capacity to 20 million tonnes in the longer term. ”Inner Mongolia will be our first target for acquisition, but given our management and advisers’ background, we will also look for opportunities in Shanxi and Shaanxi provinces,” Wang said.
Initially focussing on power station coal, King Stone will try and expand Shanxi Coking Coal Group, the mainland’s largest coking coal producer.
South China Morning Post – 2nd March 2010