Three chemical enterprises under Lanhua Kechuang have suspended production completely for unconventional maintenance.

Recently, Shanxi Lanhua Technology Venture Co., Ltd. (Lanhua Kechuang, 600123) issued Announcement Lin 2026 No. 024, three coal chemical production entities under its umbrella, namely Lanhua Coal Chemical, the Chemical Branch, and Lanhua Clean Energy, will completely suspend production starting from mid-August.

This shutdown is not a routine equipment maintenance, but a response to national industrial policies to eliminate the outdated fixed-bed intermittent coal gasification process, and all production capacity will be taken over by the newly-built energy-saving and environmental protection upgrading and transformation project.

According to relevant policies in the State Council's Action Plan for Continuous Improvement of Air Quality, the fixed-bed intermittent coal gasification technology has been included in the restricted development catalogue, and local competent departments have required relevant coal chemical enterprises to complete the process upgrading and transformation within a time limit. The gasification processes of the above three enterprises of Lanhua Kechuang all adopt the fixed-bed intermittent coal gasification technology, which falls within the scope of transformation. Upon review and approval by the shareholders' meeting, the company decided to integrate the production capacity, environmental protection and energy consumption indicators of the three enterprises and implement the Lanhua Coal Chemical Energy-saving and Environmental Protection Upgrading and Transformation Project.

Overview of original main businesses and production capacities of the three suspended enterprises

1. Shanxi Lanhua Coal Chemical Co., Ltd.

Its main businesses are synthetic ammonia and urea. The original equipment has a production capacity of 190,000 tons per year of synthetic ammonia (alcohol) and 300,000 tons per year of urea, making it one of the core production units of the company's fertilizer sector.

2. Chemical Branch of Lanhua Kechuang

Its main businesses are urea and synthetic ammonia. It is an important production base for fertilizers of Lanhua Kechuang, with urea and synthetic ammonia as its core products, and is an important part of the company's original urea production capacity.

3. Shanxi Lanhua Clean Energy Co., Ltd.

It mainly produces chemical products including methanol and dimethyl ether. The original production capacity is 200,000 tons per year of methanol and 100,000 tons per year of dimethyl ether, and its products are sold to fuel and chemical raw material markets.

The total integrated original production capacities of the three enterprises: 260,000 tons per year of synthetic ammonia, 560,000 tons per year of urea, 230,000 tons per year of methanol and 100,000 tons per year of dimethyl ether, all of which will be included in the overall construction of the new upgrading and transformation project.

Construction progress and new production capacity of the new upgrading and transformation project

The Lanhua Coal Chemical Energy-saving and Environmental Protection Upgrading and Transformation Project started construction at the beginning of 2025, with a total estimated investment of 3.962 billion yuan. It will adopt the patented technology of crushed coal/bulk coal pressurized continuous gasification from CCDC (China Chengda Engineering Co., Ltd.) to replace the outdated fixed-bed intermittent gasification process.

After the project is put into operation, it will form a new production capacity of 490,000 tons per year of synthetic ammonia, 560,000 tons per year of urea, 94,400 tons per year of liquefied natural gas (LNG) and 56,000 tons per year of 98% concentrated sulfuric acid.

The announcement disclosed that the project is being advanced in the mode of simultaneous production and construction. At present, the boiler unit is about to be installed, the LNG storage tank has been completed, the main construction and installation of the main unit, the installation of most equipment and the construction of the urea synthesis foundation have all been completed, and the supporting public works are advancing steadily. It is planned to complete mechanical completion on August 31, 2026, achieve handover of the project on October 31, and complete the project and put it into trial production before December 31.

The company stated that by taking advantage of the production suspension window period of this equipment, it will seize the construction period to promote equipment installation, strive to complete the trial operation of the project by the end of the year, complete the process upgrading of the coal chemical sector, and achieve high-quality industrial development.

Risk reminder: The project construction progress is affected by multiple factors such as engineering and equipment, and there is a risk that the production will not meet expectations. The above information is all from the public announcements of the listed company.