China Starts 24 Million-Tonne Coal-to-Liquids Plant, Lifting Coal Value 700%
Updated
Updated · South China Morning Post · Aug 24
China Starts 24 Million-Tonne Coal-to-Liquids Plant, Lifting Coal Value 700%
2 articles · Updated · South China Morning Post · Aug 24
Summary
China Energy Group’s Ningxia plant began full operations last month, converting coal into oil products including rocket fuel feedstocks and machine lubricants while raising coal’s value sevenfold.
The facility processed 24 million tonnes of coal in 2025—about a quarter of Ningxia’s annual output—using indirect liquefaction that turns coal into synthetic gas made of carbon monoxide and hydrogen.
Oil above $100 a barrel after the Strait of Hormuz was blocked during the US-Israel war on Iran made coal-to-liquids especially profitable and strengthened its role in cutting China’s import dependence.
The project underscores a broader energy reality: China has abundant coal but limited oil and scarce natural gas, while coal still accounts for more than 90% of energy use in Ningxia.