CCS is a company registered in Bermuda and owns 100% of the shares in the capital of Chang Yuan (Huaibei) Chemicals and Coking Co Ltd (CY (Huaibei)), a company registered and located in the Peoples Republic of China. CY (Huaibei) operates a 480,000 tonne per annum capacity coke plant and is involved in the sale of coke and its by products.

CCS is wholly owned by RCI.

Mr Wu was instrumental in the acquisition of the coke plant which was owned by the People’s Government of Huaibei City on the 21st April 2003. The coke manufacturer had previously been established by the Huaibei Mining Bureau (HCCP) as a state owned enterprise in 1974.

When HCCP first commenced operation in 1974, it had only one coke oven, comprising four chambers, with a coke capacity of 200,000 tonnes per annum. During the period from 1995 to 1998, HCCP constructed another two chamber coke oven, By 1999, its coke production capacity increased to 400,000 tpa.

Following the acquisition and to stem losses, Mr Wu Pun Yan streamlined the operating and management structure of the coke business and undertook a rationalisation of its customer base, with a view to focus on sales to established companies in the Iron and Steel industry in the PRC.

In June 2004, Mr Wu completed the construction of a new 200,000 tpa coke ovens which replaced the 1974 vintage ovens raising total capacity to the current 480,000 tpa. A variety of by products are produced by the cokeworks which enhance the profitability of the plant.

The principal business activities of CCS are as follows:

• Manufacture and sale of grade 2 coke from locally sourced coals.
• Production of coke by-products namely; Tar, benzene and ammonium sulphate.
• Production of coal gas which is used to fuel the city of Huaibei. CCS is the only supplier of coal gas to the city.

The Production Process

The processing of metallurgical coal into coke and other by-products is illustrated below:




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The principal product, coke, is used primarily in the manufacture of pig iron which is a major component in the production of steel.

Generally, CCS produces approximately 0.75 tonnes of coke from processing 1 ton of metallurgical coal. The bulk of the coke, which is usually approximately more than 25mm, is used in blast furnaces to make iron.

Blast furnace coke is generally divided into three different grades depending on the level of carbon and other mineral content. Grade 1 coke is suitable for use in larger furnaces and has a higher heat yield compared to grade 2 and 3 coke. The quality grade of coke also affects the production of iron. As compared to other grades of coke, grade 1 coke produces the least ash and consequently yields more iron and achieves higher productivity.

CCS has the production capabilities to produce all grades of blast furnace coke, but mainly produces Grade 2 coke as the type of metallurgical coal used in their production process is more suitable for this grade of coke.

Tar is a by product of the distillation of metallurgical coal in coke processing. Generally CCS achieves yields of 0.027 tonnes of tar from processing 1 ton of metallurgical coal. Coal tar in turn is distilled into many fractions to yield a number of useful organic products, including benzene, toluene, naphthalene and anthracene. CCS tar is sold mainly to producers of naphthalene, anthracene, carbon lack and water proofing materials.

Coal gas is obtained as a by product in the preparation of coke. Its composition varies but is largely made up of hydrogen and methane with small amounts of other hydrocarbons, crbon monoxide, carbon dioxide and nitrogen. Genrally CCS produces 300m3 of coal gas from processing 1 tonne of metallurgical coal. Coal gas is used as a fuel and illuminant.

CCS is the only producer of piped coal gas to Huaibei City, delivering approximately 30 million cubic metres of the requisite gas composition yearly through direct piping from the coke plant to the residents and eneterprises in Huaibei city.

CCS also use the coal gas to power in house plant generators to supplement electricity usage. Gas is also burnt in the coke ovens and other plant boilers. Coal gas in excess of these requirements is combusted.

CCS is located in the Huaibei Coal Fields where metallurgical coal is currently abundant. The supply of coal is mainly obtained from HMGC, a state owned enterprise which mines the Huaibei Coal fields. CCS estimate that the 6,912 square kilometres hold approximately 6.7 billion tones of coal reserves. In addition metallurgical coal is sourced in other areas such as Shandong, Shanxi and Jiangsu provinces.

As coke is an important component in the manufacture of pig iron which is an essential element in the manufacture of steel, CCS coke is sold to iron and steel manufacturers. Most iron and steel works are located in Jiangsu, Anhui, Shanghai and Zhejiang provinces.

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