The important path for coal companies to get out of trouble

Recently, China Coal Industry Association organized a press conference for the corporate social responsibility report in the coal industry, and 13 coal companies including Shenhua Group Co., Ltd. issued a 2015 social responsibility report. A report compiled by the "Economic Daily" reporter found that reduction, cleanliness, and diversification have become an important path for coal companies to get out of trouble.

Reduction:

Enterprises actively reduce production capacity

Since 2012, the coal industry has ended its "golden decade", development has been in trouble, and major business indicators have shown a downward trend. This is related to the narrowing of coal market demand, but more importantly due to the excessive expansion of coal production capacity, resulting in a serious excess supply of the market, the price plummeted, corporate profits plummeted, and even the industry-wide loss of more than 90% of the situation . In order to cope with the unfavorable situation in which the market continues to be sluggish and the production and operation of enterprises are difficult, the coal industry must accelerate the structural reforms on the supply side.

Wang Shaoyu, director of the office of Shenhua Group, said that the Shenhua Group has 54 coal mines that are put into production and the coal production capacity is close to 500 million tons. During the two years from 2014 to 2015, Shenhua Group actively reduced its coal production capacity by 95 million tons to jointly cope with the difficulties in the coal market.

Chen Long, director of the Corporate Culture Department of China Coal Group, said that in order to adapt to changes in the market, China Coal Group, while advocating the coal industry to cut production and limit production, has taken the initiative to reduce production and production, delaying the operation of the three coal mines. In 2014, the coal output of the China Coal Group decreased by 4.1% year-on-year. In 2015, coal production further decreased by 9.3% year-on-year, and the cumulative production volume decreased by 25 million tons on a 2013 basis, which contributed positively to the elimination of excess capacity in the coal industry.

In 2015, China Coal produced 166 million tons of raw coal. Under the circumstances that the price of coal fell, the production cuts and other factors reduced the benefit by 8.5 billion yuan, the company tapped the potential and increased efficiency by more than 6 billion yuan, achieving an operating result better than the market average. .

Yu Deyuan, deputy general manager of Yitai Group, told the reporter that Yitai Group actively adjusted the production output of mines and product structure, strengthened coal washing, improved product quality, and strived to maximize production efficiency. In 2015, Yitai Group actively compressed raw coal production on the basis of coal production of 44.45 million tons in 2014. Coal production decreased by 22.5% year-on-year, which was 42.6% lower than the company's highest output in 2011. At the same time, relying on the integration of production, transportation and sales with measures such as reciprocity and mutual benefit, product customization, and perfect after-sales service system, the company is still operating at a meager profit when the industry suffers a loss of more than 90%.

Cleanliness:

Change from "black" to "green"

When it comes to coal, the words most easily thought of by people are: black, dirty, polluted, and hazy. Because of this, the voice of “going to coal” in the society is getting louder and louder, which is not conducive to the recovery of coal demand. For this reason, coal companies have further increased their input in the clean production and utilization of coal and strive to achieve green development.

Wang Shaoyu introduced that the Shenhua Group has developed a coal-based clean energy supply system through coal clean development, clean processing, clean transportation, clean power generation, clean conversion, and created ecological mines, green channels, environmental power plants, and modern coal chemical industries. Chains lead the green development of the industry.

Shenhua Group continued to optimize the coal mining, washing, processing, and transportation processes, systematically promote clean coal production, increase the efficiency of comprehensive utilization of coal resources, and strive to achieve a “green” coal change and promote the transformation and upgrading of traditional coal production models. In 2015, Shenhua Group invested 5.79 billion yuan in special energy-saving and environmental protection funds, implemented energy-saving projects such as boiler renovation, through-flow reconstruction, frequency conversion, ground-source heat pump and air source heat pump renovation, dust removal, denitrification, comprehensive utilization of water resources, and prevention and control of wastewater Environmental protection projects such as ecological construction and the management of drainage facilities.

Yu Deyuan introduced that Yitai Group insists on the development path of clean production, circular economy, green mines, and tree planting and carbon reduction. At present, the greening rate of industrial sites of the company's various units reaches more than 95%, and the affiliated Dadi Mine, Baoshan Mine, and Dingjia Canal have been identified as pilot units for green mine construction. In response to the current situation of lack of forest, greenery and sand in the area of ​​Ordos [0.55% Capital Research Report], from 2011, the Yitai Group has acquired the construction of carbon sink forests in the Kubuqi desert wasteland. As of 2015, the successful completion of the million-million-acre carbon sink forest project resulted in a total investment of 360 million yuan, a total afforestation area of ​​340,000 mu, and a wind and sediment control area of ​​770,000 mu.

China Coal Group insists on intensive production methods, clean production processes, and efficient use of resources, and promotes the construction of “Green China Coal”; all of its power plants implement de-NOx removal and transformation, achieve pollutant discharge standards, build ecological mining areas, and do a good job of coal mining. Management of subsidence areas, land reclamation in mining areas and other ecological restoration work have protected and improved the ecological environment in mining areas.

Jinneng Group Co., Ltd. invested in the construction of Jiajie Gas-fired Power Plant, low-calorific value coal-fired power plant, and comprehensive utilization of fly ash from Chenzhou, while it did a good job in coal mine gob area treatment, sewage treatment, and zero discharge of power plants.

Diversification:

Improve the ability to withstand market risks

From the report, diversification has become an important channel for coal companies to enhance their ability to withstand market risks. The reporter found that the diversification of coal companies is mainly divided into three areas: thermal power generation, coal chemical and non-coal industries.

The total installed capacity of the Shenhua Group's commissioned power plants reached 78.51 million kilowatts, of which, the installed capacity of renewable energy such as wind power, hydropower and photovoltaics exceeded 6.5 million kilowatts. In 2015, the Shenhua Group generated 317.1 billion kWh of electricity. At present, the company has 55 coal-fired units to achieve ultra-low emissions. In 2017, the coal-fired generating units in East China and Central China will be the first to achieve ultra-low emissions; by 2020, coal-fired units including the western region will all achieve ultra-low emissions.

The four power plant projects of China Coal Group started construction, with an installed capacity of 4,040 megawatts and annual coal consumption of more than 12 million tons. At the same time, the pace of the company's development of the coal chemical industry is also accelerating. In 2015, coal chemical projects such as Yulin Olefin, Tokeda Chemical Fertilizer and Yuanxing Methanol were successfully put into production, and three coal chemical companies achieved a total profit of 1.5 billion yuan, becoming a new profit growth point.

Yitai Group also accelerated the pace of upgrading. In 2015, it produced 202,000 tons of various types of oil products. With the continuous decline in international crude oil prices, it still achieved a net profit of 11 million yuan. With the gradual emergence of the demonstration target pole effect and the gradual maturity of key technologies, significant social benefits and better economic benefits have been achieved. In 2015, on the basis of the successful operation of an annual output of 160,000 tons, the project actively constructed the 1.2 million ton/year fine chemicals project in Hangjin Banner, and steadily launched the 2 million tons/year coal-to-oil project in Zhungeer Banner and Yili 100 in Xinjiang. The preliminary work for the construction of a 10,000-ton/year coal-to-oil demonstration project.

The railway transportation section of some coal companies also achieved good results. Shenhua Group's Shuohuang Railway has completed a shipment volume of 215 million tons in 2015, and achieved operating revenue of 13.386 billion yuan and profit of 6.7 billion yuan for the year. Yitai Group owns a total of 83.52 million tons of self-owned rail freight, including 42.4 million tons of foreign transport, and a net profit of nearly 500 million yuan, making it the company's new profit center.