Sino Biopharmaceutical, China's pharmaceutical giant, announced in Hongkong Sunday that it had signed an agreement with northwest China's Shaanxi provincial government to build the country's first project to converse coal into low-carbon olefin.
"The technology boasts low cost compared with the conventional method of extracting similar products from petroleum," said Xie Bing, chairman of the company listed in Hong Kong's stock exchange.
"It will be a new source of olefin and carries special economic value in light of the rising oil prices," he said.
With a total investment of 5 billion yuan (628 million U.S. dollars), the joint venture will be built in Shaanxi's Yulin city and is expected to commence operation in the first quarter of 2007.
"The formation of the joint-venture not only sees us diversify our business into other fast growing areas, but will enable us to benefit from the relatively high growth and high yield coal refinery industry in China," Xie said.