In the first quarter of 2008, China¡¯s first indirect coal-to-oil liquefying project ¡°Yanzhou Yulin 1 million tons/per year indirect coal-to-oil liquefying demonstration project application" was assessed and approved by the NDRC. This means the project is ready to be built. The other three major coal businesses also involved in coal-to-oil businesses will also speed up their construction of similar projects. 

The Yanzhou project will be built in 2 phases. Phase I is to build a annual capacity of 5 million tons of oil by 2013 with a capital of 50 billion yuan. Phase II of the project is to build an annual capacity of 10 million tons. Phase I demonstration project include a production line with an annual capacity of 1 million tons. The project is estimated to be completed by the end of 2009 at the latest. 

Yankuang Group started coal-to-oil research in 1998. In November 2004, its independent technologies of 10,000-ton-grade low temperature indirect coal liquefaction and the Fischer-Tropsch synthesis catalyst passed trials successfully. The National Science and Technology Appraisal Committee confirms that Yankuang has already mastered the full set of technology in indirect coal-to-oil liquefaction, which has reached advanced international standard. This will save Yankuang a large sum of technological transfer fees.