On the evening of May 15, 2026, Hengyi Petrochemical announced that its wholly-owned subsidiary Hengyi Energy Technology (Turpan) Co., Ltd. plans to invest in the construction of a coal to ethylene glycol project with an annual output of 2.4 million tons of high-quality fibers. The total investment for the project is expected to reach 25.7 billion yuan.

Turpan Project Details

The project is located in the Coal based New Materials Circular Industry Park of Turpan Economic Development Zone, with an expected construction period of three years, and is expected to be put into operation in the first half of 2028. The main construction content of the project is to produce 2.4 million tons of high-quality fiber coal to ethylene glycol annually, while supporting the construction of production equipment, auxiliary production facilities, public works, as well as various production service related supporting infrastructure such as gasification equipment and purification equipment.

Project funding guarantee

The funding for this project comes from the company's own funds and self raised funds. Since 2026, the profitability of various products of Hengyi Petrochemical has improved, and the net profit attributable to the parent company in the first quarter of 2026 has significantly improved. Currently, the company's cash flow remains stable and abundant. With the continuous improvement of subsequent performance and the expected conversion of convertible bonds into shares during their existence, the company's asset liability ratio is expected to further decrease. At the same time, the company will strengthen investment control and comprehensively reduce project investment expenditures. Therefore, the investment in this project will not have a significant negative impact on the company's production and operation, as well as its asset liability ratio. The company will make every effort to promote project construction.

Hengyi Petrochemical stated that the current global energy supply uncertainty is intensifying, and the integrity and independent controllability of the industrial chain have become important supports for national strategic security. The safety and reliability of raw material supply have become the primary goal of enterprise development, and the strategic advantages of coal based coal chemical industry are becoming increasingly prominent. To ensure the stable supply of ethylene glycol, the core raw material for downstream polyester products, the company closely follows the national energy security strategy and industrial transformation and upgrading deployment, and combines China's rich coal and low oil resource characteristics to determine coal based new materials as the core strategic development direction, producing high-end chemical products by replacing petroleum with coal. The layout of the Xinjiang coal to ethylene glycol project is not only a key step in extending upstream of the polyester industry chain and achieving independent and controllable raw materials, but also a strategic choice to enrich raw material sources, reduce the impact of crude oil price fluctuations, and enhance the profitability resilience of the entire industry chain.

After the project is put into operation in the first half of 2028, Hengyi Petrochemical will achieve diversified sources of processing raw materials and integrated product raw materials, building a unique new industrial pattern of coordinated development of oil, coal, and cloth in the industry. It will fully leverage the vertical integration advantages of coal resources - ethylene glycol - polyester manufacturing, help the company get rid of its dependence on a single crude oil, further enhance the stability and predictability of the entire industry chain profit, and significantly improve the company's profitability and risk resistance. Keywords: Hengyi Petrochemical, Turpan, Coal Chemical Industry

Jingzhou Circular New Materials Project

On the evening of May 15, 2026, Hengyi Petrochemical also announced another investment plan. The company's subsidiary, Hubei Hengyi, plans to build a dual track recycling system based on online digitalization and offline physical construction covering the whole country, using the company's self-developed exclusive patented technology, and investing in the construction of a 300000 ton per year circular new material industrial demonstration project in Jingzhou, Hubei. The project's products can be widely used in various fields such as clothing, shoes, hats, household goods, and transportation. The project is expected to have a total investment of 1 billion yuan and a construction period of 18 months. After completion, it will further diversify the company's processing raw material sources and effectively reduce dependence on a single crude oil resource.Editor/Gong Ziwei