Most of it has already been “divided up” by large corporations.
　　
　　In the golden autumn of September, at the Shenhua Xinjiang Branch’s open-pit coal mine in Wucaiwang, Jun Dong Basin, massive excavators are tirelessly digging away. “Just a few scoops—and you can fill an entire truckload.” Visitors standing on the edge of this open-pit coal mine, with an annual production capacity of 5 million tons, gaze down toward the mine floor. The giant excavators look almost like toys, while the construction workers appear tiny as ants.
　　
　　However, compared to the entire Jun Dong Basin, how significant is this magnificent open-pit coal mine? The Jun Dong coal basin has estimated reserves of 390 billion tons. “At the national coal production rate of 2.523 billion tons per year in 2007, these reserves could last for over 100 years.”
　　
　　According to statistics, there are currently 25 companies that have obtained exploration rights in the Jun Dong region. These companies plan to carry out 60 coal-to-power and coal-to-chemicals projects in Jun Dong, with a total estimated investment of 490 billion yuan.
　　
　　However, Jun Dong is merely one of the four designated coal bases in Xinjiang. Xinjiang’s proven coal reserves are estimated at 21,900 tons, accounting for roughly 40% of the nation’s total reserves. Corresponding to these enormous coal resources are a flood of large corporations and massive amounts of capital—Shenhua, Luneng, Luan, Xinwen, Yankuang, Xukuang... At the dawn of the new century, major coal giants flocked to Xinjiang’s coal bonanza:
　　
　　In November 2004, the groundbreaking ceremony was held for the Luneng Coal-to-Power and Chemical Base—a major “West-to-East Power Transmission” project jointly constructed by Shandong Luneng Group and Xinjiang. The power plant, planned in three phases, will have a total installed capacity of 11.6 million kilowatts. Meanwhile, the base will also proceed with the construction of subsequent coal liquefaction projects in three phases.
　　
　　In April 2005, what was then touted as the nation’s largest coal chemical project was established in Yili, Xinjiang. The Xinwen Mining Group planned to invest over 30 billion yuan during the 11th Five-Year Plan period to build a 10-million-ton coal mine in the Ili River Valley. Additionally, the group intended to spend between 10 and 15 years investing in Yili to develop an ultra-large-scale coal chemical base capable of processing 50 million tons of raw coal annually. In August of the same year, Shenhua Group took controlling stakes in and reorganized the Xinjiang Urumqi Mining (Group) Co., Ltd., establishing Shenhua Xinjiang Energy Co., Ltd., thereby laying the foundation for Shenhua’s large-scale entry into Xinjiang.

Luan Mining Group, a major coal enterprise from Shanxi, is also eager to stay ahead of the curve. In September 2007, it increased its capital and reorganized Xinjiang Hami Coal Industry Group Co., Ltd., establishing Luan Xinjiang Coal Chemical (Group) Co., Ltd. and acquiring approximately 12.5 billion tons of coal reserves held by the latter.
　　
　　Yan Hushi, director of the Service Center for the Jundong Wucailwan Coal-Electricity-Coal Chemical Base, said that in Jundong Wucailwan, most of the coal resources that are best suited for mining and utilization have already been “divided up” among large enterprises. Among them, Shenhua Group holds approximately 10 billion tons of proven coal reserves, while Tianchi Energy Company controls 4.36 billion tons of proven reserves.
　　
　　Zhundong to build a brand-new coal city in advance.
　　
　　As the construction of the coal-power and coal-chemical base in the Jun Dong region is vigorously underway, many locals believe that Jun Dong will grow into a brand-new coal city.
　　
　　Indeed, the Jun Dong region boasts coal reserves estimated at over 390 billion tons, with proven reserves amounting to 88.9 billion tons. Forty major domestic and international enterprises have already set up operations there. Coupled with well-developed infrastructure—including newly constructed highways, railways, and water conservancy projects—and the large influx of industrial workers expected to follow the launch of coal-to-power and coal-to-chemicals projects, the conditions now seem fully in place for the development of a new resource-based city. Xinjiang’s previous example—the “Oil City” of Karamay—rose to prominence precisely thanks to its abundant petroleum resources.
　　
　　A set of recent figures provided by the local government authorities roughly illustrates the scale of development at the Jun Dong base:
　　
　　Shandong Yanzhou Mining Co., Ltd. has cumulatively invested 22,945,400 yuan in exploration, identifying and estimating coal reserves totaling 4.6 billion tons. The company is also planning and constructing a 500,000-ton synthetic ammonia and an 800,000-ton urea project, with long-term plans for a 3-million-ton coal-to-oil project. Xinjiang Shenhua Mining Co., Ltd. has cumulatively invested 24,726,100 yuan in exploration, preliminarily identifying and estimating coal reserves of 9.35 billion tons. The company plans to jointly build, with the Guodian Group, a power plant consisting of two 330,000-kilowatt units in the first phase and four 660,000-kilowatt units in the second phase. Shandong Luneng Group has obtained exploration rights covering 147 square kilometers, with estimated coal reserves of 10 billion tons. China Petrochemical Corporation has acquired exploration rights covering 102.72 square kilometers, with estimated coal reserves of 4.5 billion tons, and is planning to construct two 3.5-million-ton coal-to-liquid oil projects and two 600,000-ton olefin projects...
　　
　　Interestingly, some forward-thinking real estate developers in Urumqi are also highly confident about the rapid development of Jungar. Ma Ke, Chairman of Xinjiang Dazhong Real Estate Development Co., Ltd., said: “Once Jungar’s major projects get underway, the massive influx of people and goods will provide strong support for Urumqi’s housing prices.”
　　
　　Meanwhile, three other coal-to-power and coal-to-chemicals bases in Xinjiang are also under intensive construction. Lu'an Xinjiang Coal Chemical (Group) Co., Ltd., located in Hami, plans to increase its coal production capacity from the current 4.75 million tons per year to 16 million tons by the end of the 11th Five-Year Plan period, and further to 40 million tons by the end of the 12th Five-Year Plan period. At the same time, the company is building a new 4×1 million-kW power plant, a coal-based synthetic oil project with an annual capacity of 3 million tons, and a ferroalloy project with an annual output of 300,000 tons. In Ili, Shandong Xinwen Group plans to invest 30 billion yuan during the 11th Five-Year Plan period to complete a series of coal chemical projects. Currently, procedures for obtaining approval documents for Ili No. 1 Mine, as well as applications for the power plant and coal chemical projects, are progressing smoothly. Among large enterprises entering Xinjiang to develop coal-to-power and coal-to-chemicals projects, Xinwen is expected to be among the first to receive the “road permits” issued by the National Development and Reform Commission.

　Wang Wenyou, Deputy Secretary of the Qitai County Party Committee, said that as the leading of Xinjiang’s four major coal-power and coal-chemical bases, the development of the Jun Dong base has attracted even greater expectations and attention. At the signing ceremonies and groundbreaking events for major projects, high-ranking officials at the level of Standing Committee members of the Autonomous Region Party Committee have frequently been present. In various forums, the progress of its development has been highlighted as being of paramount importance to the overall economic development of the autonomous region.
　　
　　Three major challenges in the coal-fired power and coal-to-chemicals industries remain to be solved.
　　
　　On August 29, the first coal-to-chemicals project at the Jun Dong base—the Xinjiang Shendong Tianlong Group’s 500,000-ton-per-year humic acid project (with an initial phase capacity of 100,000 tons)—began operations. The project is planned to invest 160 million yuan and is expected to generate an annual output value of 1.2 billion yuan. This news has brought great relief to supporters of Xinjiang’s coal-power and coal-to-chemicals industries: after years of preparation, a large number of coal-to-chemicals projects have finally “opened for business.”
　　
　　According to Gao Jianjun, from the Office of the Leading Group for the Coal-Electricity-Coal Chemical Industry in Xinjiang, the planning projects for the Jun Dong and Ili coal-electricity-coal chemical bases are currently progressing well. Relevant parties are accelerating preliminary work, including resource exploration, feasibility studies, environmental impact assessments, and project approval procedures.
　　
　　However, industry experts believe that the development prospects and construction progress of the Xinjiang coal-power and coal-chemical base largely depend on national industrial policies, the achievement of energy-saving and emission-reduction targets, and the willingness of enterprises to develop the project.
　　
　　Yan Hushi, director of the Service Center for the Jundong Wucaiwan Coal-to-Power and Coal-to-Chemicals Base, said that currently, the national “Development Plan for the Coal-to-Chemicals Industry” has not yet been officially released. In 2006, the National Development and Reform Commission issued the “Notice on Strengthening the Management of Coal-to-Chemicals Projects and Promoting the Healthy Development of the Industry,” which stipulated: “For coal-to-oil, coal-to-olefins, and foreign-invested coal-to-chemicals projects, the approval system shall be strictly implemented in accordance with relevant regulations; any practice of breaking down large projects into smaller ones, conducting approvals in violation of regulations, or delegating approval authority step by step is strictly prohibited.” This means that whether or not the numerous local coal-to-chemicals projects will ultimately proceed depends entirely on the decision of the National Development and Reform Commission.
　　
　　Wu Jiangsen, deputy director of the Development and Reform Commission of the Ili Kazakh Autonomous Prefecture, said that, based on the current situation analysis, during the 11th Five-Year Plan period, coal-fired power and coal-to-chemicals projects in the autonomous region will mainly focus on preliminary work. It’s likely that large-scale project launches and production won’t begin until the 12th Five-Year Plan period.
　　
　　Another challenge facing the construction of Xinjiang’s coal-power and coal-chemical industry base is how to secure emission reduction and energy-saving targets. Analysts believe that compared with eastern provinces and regions, Xinjiang, with its relatively lower level of economic development, has a smaller overall quota for emission reduction and energy savings. With the large-scale launch of numerous power projects and coal-chemical projects as part of the construction of the four major coal-power and coal-chemical bases, there will inevitably be a substantial demand for emission reduction and energy-saving indicators. However, these targets cannot be met through coordination within the autonomous region itself.
　　
　　In fact, on July 30 this year, Xinjiang, together with six other provinces and regions including Hebei and Shanxi, was identified as having failed to meet its 2007 energy-saving targets in the first-ever evaluation and assessment results on energy conservation and emission reduction released by the National Development and Reform Commission.
　　
　　Yan Hushi said, “We hope that the relevant national authorities will, in accordance with the spirit of the State Council’s document, provide special policy support to Xinjiang’s coal-fired power and coal-to-chemicals industries.”
　　
　　Large enterprises and conglomerates that have already secured substantial coal resources are also grappling with the issue of “securing land but failing to develop it,” a problem that is causing considerable headaches for those planning coal-fired power and coal-to-chemicals bases.
　　
　　A county government official who asked not to be named said, “In recent years, many large enterprises and conglomerates have come in. The high-quality, easily accessible resources have basically been ‘divided up’ among them. Now the problem is that some companies aren’t seriously fulfilling the agreements they initially signed with the autonomous region—instead, they ‘secure the rights but don’t start developing,’ or ‘secure the rights but delay development,’ dragging their feet. As a result, the companies that really want to get involved in coal resource development now find themselves with no resources left.”

　“Can we revoke their exploration and development rights? No, we can’t. After all, the large enterprises and conglomerates that have entered Xinjiang are at such a high level that county and prefectural governments simply don’t rate them at all. Moreover, these companies are the ‘wealth gods’ invited by the autonomous region—local authorities simply can’t afford to offend them.”