Hongqingliang coal mine of Hangjin Banner West Energy Development Co., Ltd. was required by Ordos authorities to cease production immediately due to illegal mining, according to an announcement of Beijing Haohua Energy Resource Co., Ltd. The mine has suspended operation on the afternoon of August 7.
Hangjin Banner West Energy Development Co., Ltd. is an important holding subsidiary of Beijing Haohua Energy Resource Co., Ltd., with 60% of its shares directly held by Haohua Energy.
West Energy produced a total of 5.03 million tonnes of coal in 2019, accounting for 39.33% of Haohua Energy's total coal output. Its net profit reached 223 million yuan ($32.13 million) in 2019, of which 121 million yuan was attributable to shareholders of the listed company, accounting for 46.23% of the net profit attributable to the parent company, the announcement showed.
It is still uncertain when Hongqingliang mine will be able to obtain a mining license and resume production, and the impact on Haohua Energy's operating results is also not confirmed.
Data shows that Hongqingliang coal mine has a mining rights area of 48.58 square kilometers. Its resources are 741.68 million tonnes, and the mineable reserves are 485.07 million tonnes. The designed production capacity is 6 million tonnes per annum (Mtpa), and the expected yearly output is 4 million tonnes.
The service life is 54.84 years. There are six minable coal seams in the mining area with an average thickness of 5.32m. Coal produced is non-caking coal and long-flame coal with low ash (≤8%), extra low sulfur (≤0.5%), and extra low phosphorus (≤0.010%), which is ideal for household use and power generation.
Hongqingliang mine has a 6.0Mtpa coal preparation plant.
(Writing by Shengnan Liu Editing by Jessie Jia)
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