China Coal Shaanxi Yulin Energy Chemical Co., Ltd.’s Yulin Energy Chemical Phase 2 project has reportedly entered its commissioning (trial-run) stage.
The project is a coal chemical facility with annual production capacity of 2.2 million tonnes of methanol and 900,000 tonnes of polyolefins, with EPC (Engineering, Procurement and Construction) work reportedly carried out by China Huanqiu Contracting & Engineering and Sinopec Nanjing Engineering. The DMTO-III (Methanol to Olefins) process technology used to convert methanol into olefins is reportedly licensed from the Dalian Institute of Chemical Physics (DICP), Chinese Academy of Sciences.
Total investment is reported at approximately RMB 200 billion. Handover of major equipment was reportedly completed in June 2026, with the DMTO-III unit achieving its first ignition on June 23 and the methanol synthesis unit handed over on June 26. Commissioning is targeted for the third quarter of 2026, with a goal of reaching a 70% operating rate by year-end, it is reported.
The project is viewed as part of China’s broader strategy to expand its coal chemical industry, leveraging coal resources in the Yulin area of Shaanxi Province to produce higher-value chemical products such as methanol and polyolefins, it is reported.
Large coal chemical complexes progressing sequentially through equipment handover and commissioning is seen as a case illustrating the continued expansion of coal-based chemical production capacity in inland China.
The results of third-quarter commissioning and whether the year-end target of a 70% operating rate is achieved are worth watching.