Press Room

On Thursday, September 20, 2007 Evergreen welcomed to its Denver headquarters a high-ranking delegation from one of China’s five state-owned power generation companies, China Power Investment (CPI).

The purpose of the delegation’s visit was to sign an important “Agreement To Proceed” immediately with specification and design work that leads to construction of a K-Fuel® coal refinery in China’s Inner Mongolia Autonomous Region.

This is not an agreement to actually build a plant yet, but it is a noteworthy and detailed agreement involving three phases of work that, if completed successfully, would result in an engineering, procurement and construction contract being awarded for construction of a K-Fuel® plant in China.

The first phase is a feasibility study. The second is a technical services contract with Evergreen, funded by CPI, that looks at environmental, water and land use specifications related to the plant. The third phase involves detailed specifications and engineering design work to meet the specifications of Baiyinhua Coal and Power Company, the CPI subsidiary that actually signed the agreement.

CPI is keenly interested in Evergreen’s technology, according to Madam Zhang Xiaolu, the vice president of international business at CPI and leader of the delegation.

“We have been interested in the K-Fuel® technology for some time and are happy to have an agreement to move forward at this time,” she said.

Evergreen’s President and CEO, Kevin Collins, said that China presents an important business opportunity for Evergreen – one the company can’t overlook.

The agreement was signed one day after the delegation toured Evergreen’s first-of-its-kind coal refinery in Gillette, Wyoming.

Underscoring the fact that refined coal is a near-term solution that makes coal cleaner – not an esoteric technology years from deployment—the delegation witnessed actual operations at the plant.

The Gillette refinery produces refined coal for sale to commercial customers, but it also produces coal for test burns, tests new types of low-rank coal from places like Russia and Indonesia, and serves as a process improvement test bed.

Before and after the tour, the Chinese delegation received technical briefings from Evergreen’s on-site engineering staff

Those briefings continued Thursday in Denver with support from Bechtel Power Corporation following the official signing ceremony that was attended by a representative of the Colorado Office of International Trade.

Before visiting Denver, the delegation was part of a larger group of Chinese utility and government officials meeting at the Department of Energy in Washington.

There, they signed documents officially added Evergreen’s Refined Coal to the list of projects under the aegis of the “US=PRC Agreement for Cooperation in Fossil Fuel-Clean Coal Technologies.”

Official government acknowledgement of this initiative highlights the importance both the PRC and USA are placing on finding near-term solutions to China’s challenging energy and environmental issues.

And those issues are formidable. Last year alone China added electricity capacity equal to all of England. According to The New York Times, China will now need as much energy in 2010 as it though it would need in 2020.

This high energy demand comes with an environmental price. China is the world’s largest producer and consumer of coal. Until recently it was a net exporter of coal. Now it is an importer and it is seeking ways to make better use of its significant reserves of lower rank, sub-bituminous and lignite.

This shift, combined with the continued energy demands of rapid industrialization, is causing China to look at using lower rank coal reserves that have been ignored until now. Evergreen tested low-rank coal, known as sub-bituminous, lignite or brown coal, from Inner Mongolia and achieved good results. This is in line with the fact that Evergreen’s process using heat, time and pressure, works best at improving the performance and efficiency of these “low rank” coals that are found around the world.

China is also concerned about its environment, and its utilities and government are seeking near and long term solutions that meet growing energy demand in environmentally responsible ways. The country has initiatives under way for wind, solar and renewable energy sources, but like the United States, China still relies on coal for the majority of its electricity needs.

Therefore, it makes sense, in both China and the United States, to make coal as clean as possible as soon as possible. Zero-carbon emission coal technologies are still years or decades from widespread deployment. That is why it makes sense for the Chinese to explore pre-combustion cleaner coal technology like KFuel®.

The two days of detailed technical discussions and tours, capped by the signing of the Agreement to Proceed, represents an important step in Evergreen’s business development.

Both parties will move with urgency through the three phases of the agreement, maintaining a need for mutual understanding, reciprocity and respect as they work together to meet CPI’s specifications and help address China’s energy and environmental challenges.