Hengyi Petrochemical Announces Two Major Chemical New Material Projects, Combined Capacity Over 2.7 Million Tons, Total Investment ~26.7 Billion Yuan

Recently, petrochemical giant Hengyi Petrochemical announced two major chemical new material projects with a combined capacity exceeding 2.7 million tons and a total investment of approximately 26.7 billion yuan. Both projects address raw material supply issues and represent two solutions under the current energy crisis: circular recycling and coal chemical industry. The former is a hot layout direction for global chemical enterprises, while the latter is the most profitable industry this year and also reflects China's resource endowment advantages. (1) 300,000 Tons/Year Circular New Materials Industrial Demonstration Project The company's subsidiary, Hubei Hengyi Green New Materials Co., Ltd., plans to invest 1 billion yuan to build a 300,000 tons/year circular new materials industrial demonstration project with an 18-month construction period, located in the New Energy and New Materials Industrial Base, Jiangling County, Jingzhou City, Hubei Province. The project uses proprietary patented technology to decompose and recycle old textiles and other waste textiles, obtaining recycled polyester key intermediates through efficient depolymerization and purification processes, and reprocessing them into high-performance polyester new materials and functional special fibers. This can effectively reduce pollutants in downstream production processes and diversify raw material sources, reducing dependence on single crude oil resources. This project was previously announced in November last year with the target product being bis(2-hydroxyethyl) terephthalate (BHET). Additionally, in September last year, Zhejiang Hengyi Group signed an investment agreement with Jiangling County Government for a 1 million tons/year green circular new materials project. This project is estimated to be Phase I of that larger investment. In March 2022, the National Development and Reform Commission, Ministry of Commerce, and Ministry of Industry and Information Technology jointly issued "Implementation Opinions on Accelerating the Recycling of Waste Textiles." In July 2024, the State Council issued "Opinions on Accelerating the Comprehensive Green Transformation of Economic and Social Development." The documents state that recycling waste textiles is significant for resource conservation and pollution/carbon reduction, and is an important measure to supplement China's textile industry raw material supply and alleviate resource and environmental constraints. The target is to achieve a 30% waste textile recycling rate and 3 million tons of recycled fiber production from waste textiles by 2030. (2) 2.4 Million Tons/Year High-Quality Fiber Coal-to-Ethylene Glycol Project The company's subsidiary, Hengyi Energy Technology (Turpan) Co., Ltd., plans to invest 25.7 billion yuan to build a "2.4 million tons/year high-quality fiber coal-to-ethylene glycol project" with an estimated three-year construction period, located in the Coal-Based New Materials Circular Industrial Park, Turpan Economic Development Zone, expected to commence operations in the first half of 2028. The project aims to ensure stable supply of ethylene glycol, a key raw material for downstream polyester products, achieve raw material self-control, and reduce the impact of crude oil price fluctuations.