SinoCoking Coal and Coke Chemical Industries, Inc. (SCOK) Trial Production Run Started at State-of-the-Art Coking Facility

SinoCoking, a Florida corporation in the processing end of coal and coke, which serves the steel, power generation, and broader industrial markets in mostly central China via resources out of both its own and third-party mines, reported that their decade plus track record of producing metallurgical coke set a major new milestone today, as the trial production run successfully commenced recently (Apr 24) at their 200k metric ton coke facility.

Chairman and CEO of SCOK, Jianhua Lv, reminded investors of how the facility is being leased by Henan Province Pingdingshan Hongli Coal & Coke from Pingdingshan Hongfeng Coal Processing and Coking, and how it is ideally positioned just 3 miles away from Hongli’s existing coking plant and rail yard, which serves the company’s portfolio of mainland Chinese companies. Recent steps taken by the PRC government to roll back the coal price control rule, as well as record import volumes, has put coal consumers at the helm of the market, with all the bargaining/negotiating muscle they need to score choice contracts.

SCOK sees the bounce back in steel and construction sectors as sweetening the underlying metrics here and they are also reporting that the company has received approval from local authorities to take the facilities output capacity up by over 33% to some 1.2M metric tons per year. This sizeable expansion will help SCOK improve sales roundly while also granting access to a broader array of coke by-products that can be further refined into extremely attractive value-added chemicals, dovetailing nicely with the company’s national strategy to increase market share in the unstoppable coal-chemical industry.

Additionally, plans are already underway to improve the facility, like the coke ovens, which will ultimately be able to operate more efficiently and yield a higher quality product. The idea is to master the new type of coke ovens present in this state-of-the-art plant ahead of it becoming fully operational, even as output is gradually ratcheted up to maximum. Premium coke by-products slated to be produced like crude benzol, purified coal gas, sulfur, and sulfur ammonia represent a hearty addition to SCOK’s portfolio of products and a rebounding steel/construction market should offer even better profitability dynamics than is apparent at first glance.

The company is confident about prospects of establishing itself in a sector leadership role and leasing this facility in particular is a sign of SCOK’s bold vision for the future, where the company has maneuvered ambitiously to become an indispensible fixture of the coal and coke landscape.

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