Beijing SHENWU thermal energy technology .,LTD

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I. Basic Conditions of Beijing Shenwu

Beijing Shenwu Thermal Energy Technology Co., Ltd (hereinafter referred to as Shenwu) is a high-tech enterprise that provides energy-saving & emission reduction technologies and solutions for global fossil energy (coal, petroleum oil, natural gas and its derivatives) consumption market. The Company’s business spreads across the country and reaches the other countries or regions like India, Sweden, Indonesia, Iran, Africa and etc. with its market covering many industries like metallurgy, machinery, non-ferrous metal, petrochemical, oil refining, medicine, food-stuff, building materials, thermal power generation, civil boiler, coal gasification as well as kitchen range, etc.

Shenwu was established in 1999, over ten year’s development, its annual sales have jumped from 700,000 Yuan in 1999 to approx. 3 billion Yuan in 2009 with asset increased from 200,000 Yuan to over 1.8 billion Yuan during the same period. In addition to wholly owned Beijing Huafu Engineering Co., Ltd, Jiangsu Province Metallurgical Design Institute Co., Ltd., Hubei Shenwu Thermal Energy Technology Co., Ltd, and Beijing Bolifa High Temperature Material Technology Co., Ltd, Shenwu has also founded a JV company with American FCE International LLC. As of 2009, the company has completed more than 300 nos. energy-saving & emission reduction projects at both home and abroad through EPC mode with total accumulative contract value reaching over 10 billion Yuan. The completed projects have realized an average energy-saving rate of over 30% with corresponding reduction of hazardous gases like CO₂ etc. As a result, an annual 10 million tons standard coal equivalent of energy is saved for the country with corresponding CO₂reduction of more than 25 million tons.

The research & application of Shenwu’s regenerative HTAC technology has received extensive attention and recognition from counterparts both at home and abroad. Shenwu has been ranked at the first place consecutively for many years among the Chinese enterprises engaging in the promotion & application of energy-saving combustion technologies. Shenwu has gathered a large batch of cross-industry senior talents who specialized in energy-saving technologies from both home and abroad and boasts more than 1200 professionals of various technical disciplines including business management. The industrial yard built by Shenwu in August, 2004 with an investment of 90 million Yuan at Changping Sector of Zhongguancun Science Park occupies an area of 3.6 hectares featuring laboratory experiments, R&D and engineering design, which enables it to preliminarily established the comprehensive energy saving service capability that integrates scientific research, engineering design and manufacturing of products with core energy-saving technologies. In Sept. 2007, Shenwu invested in 320 million Yuan in Xiantao city of Hubei province, building a manufacturing base for energy saving equipment that occupies an area of 30 hectares; In order to further quicken the pace in independent innovation and industrialization of Shenwu’s energy-saving & emission reduction technologies for fossil energy, the company has further invested in 360 million Yuan in April, 2009 to build a scientific research base for energy-saving & emission reduction technologies at the Changping Sector of Zhongguancun Science Park that occupies an area of 6.6 hectares including 11 energy-saving and low carbonation technology laboratories with world advanced level, namely, regenerative type coal-based RHF direct reduction laboratory, regenerative type gasification & melting refuse burning laboratory, regenerative type smelting reduction iron-making laboratory, regenerative type boiler laboratory, regenerative type combustion laboratory, low temperature carbonization laboratory for oil shale/lignite/biomass, gas-based shaft furnace direction reduction iron-making laboratory, regenerative type petrochemical industry tube type reheating furnace laboratory, regenerative type smelting furnace laboratory, normal pressure fine coal gasification laboratory and fluid bed solid & gas reaction laboratory. After completion, the base would become one of the largest and advanced research & development bases for fossil energy high efficiency deep processing in China or even in the world, and It will be further quickening the converting speed of Shenwu’s energy-saving outcomes with independent property right and will bring the company with an annual 4 billion Yuan new orders of energy-saving projects. These laboritories will be put into operation at the end of 2010.

At present, while continuously promoting the application of regenerative HTAC technology in metallurgical, mechanical and nonferrous metal industries, Shenwu is also making its efforts in researching & developing the applications of the technology in areas such as civil boiler, thermal power generation boiler, heating furnaces of petrochemical industry, kiln & furnace of building material industry, rotary hearth furnace for coal-based DRI, shaft furnace for gas-based DRI, regenerative waste incinerator, etc. actively engaging in pushing forward the extensive popularization of regenerative HTAC technologies in the key fossil fuel consuming industries, striving to make contributions to the energy-saving and emission reduction undertakings of China as well as the world.

In 2005, Shenwu obtained a grant of 2 million Yuan from Beijing Municipal Science & Technology Commission for the Green Olympic Project “Research & Development and Industrialization on New Type High-Efficiency, Energy-Saving and Low Pollution NG Boiler System”.

At the end of 2005, Shenwu wholly purchased “Beijing Huafu Engineering Co., Ltd” of SINOPEC, which laid a foundation and built a platform for shenwu to enter into the energy-saving market of various industries like petroleum, petrochemical, coal chemical, etc.

Shenwu is the research and development company of national key research project for solid waste treatment “Key Technology Research for Regenerative Municipal Refuse Gasification & Melting Incineration System”.

Shenwu has independently developed five series products with international advanced level (approx. 100 specifications), namely, regenerative condensing boiler, waste heat boiler, coal-water slurry boiler, oilfield steam injection boiler and WNS fuel oil (gas) boiler, which can meet different requirement of customers.

Shenwu has developed the new generation gasifier together with Beijing Energy Saving and Environmental Protection Center and CCRI which is at the world leading level. The gasifier is one of the state-recommended high efficiency, energy saving and environmentally-friendly products, which is extensively applied in many fields like metallurgy, building material, petrochemical, mechanical machining and non-ferrous metal, etc., and well accepted by customers.

In April, 2006, Shenwu became the first Chinese member of Chicago Climate Exchange (CCX). At present, Shenwu has finished the preparation of the emission-reduction project report as per CCX’s requirement, and the report has passed the examination of the expert committee of CCX. The CO₂ reduction can be formally traded upon being certified by the agencies specified by CCX.

Shenwu has been consistently adhering to the strategy for sustainable development of “Population, Resources and Environment”, and will make continuous exploitations and innovations with persistent efforts to create a new chapter during the research, development and industrializing popularization and application process of the high efficiency, fine quality, energy saving and environmentally-friendly WDH & HTAC technology, so as to provide the advanced energy-saving and environmentally-friendly technologies and products for the society and enterprise to reduce the emission of hazardous gases like CO₂ and NOx, etc., continuously making its contributions to the global common undertakings of energy-saving & environmental protection.

II. Market Popularization Prospects of Shenwu’s Regenerative HTAC Technology

The regenerative HTAC technology has a market capacity of over 250 billion Yuan; the statistics made to part of the industries are listed as follows:

Thermal power industry: there are more than 6000 nos. of power generation boilers (with coal, oil and gas as fuel) in the thermal power plants subordinate to Ministry of Power and various provinces and cities, the captive power plants of various large-scale enterprises plus the heat recovery boilers in paper-making plants need to be renovated. The market potential would be 120 billion Yuan if the renovation cost of these 6000 boilers is calculated at 20 million Yuan per boiler.

Petroleum & chemical industry: there are 4000 nos. of furnaces need to be renovated, and the market potential would be 32 billion Yuan if the renovation cost is calculated at 8 million Yuan per furnace.

Metallurgy, machinery & non-ferrous metal industry: there are nearly 60,000 nos. of various industrial furnaces need to be renovated, and the market potential would be 48 billion Yuan if the renovation cost is calculated at 800 thousand Yuan per furnace.

Ceramic and glass industry: there are 15,000 nos. of furnaces need to be renovated and the market potential would be 7.5 billion Yuan if the renovation cost is calculated at 500 thousand Yuan per furnace.

Civil hot water, steam and heating industry: there are nearly 500,000 nos. of civil/industrial/domestic boilers with capacities under 20t/h across the country need to be renovated, and there are also 30~40 thousand nos. of boilers to be newly built for each year. The market potential would be above 50 billion Yuan if the cost of 1t/h boiler is calculated at 100 thousand Yuan.

III. Prediction on the Potential of Shenwu’s Regenerative HTAC Technology in Energy-saving & CO₂ Emission-reduction

Thermal power industry: calculated at saving energy of 4%~5% by fuel, the annual energy saving potential per furnace would be 10 million Yuan. After renovation, over 30 million tons of CO₂ emission can be reduced annually.

Petroleum & chemical industry; calculated at an energy saving rate of 15% and annual fuel consumption of 30 million tons, the energy equivalent to 4.5 billion Yuan can be saved per year plus the indirect benefit of 1 billion Yuan/year. After renovation, over 12 million tons of CO₂emission can be reduced annually.

Metallurgy, machinery & non-ferrous metal industries: calculated at an energy saving rate of 40% and annual fuel consumption of 20 million tons, the energy equivalent to 5 billion Yuan can be saved per year, plus the benefit resulting from the improved product quality of 1 billion Yuan/year, and the benefit resulting from the reduction of CO₂ & NOx of 2 billion Yuan/year. After renovation, over 15 million tons of CO₂emission can be reduced annually.

Ceramic and glass industry: calculated at an energy saving rate of 30%, there would be an energy saving potential of 2.4 billion Yuan/year. After renovation, over five million tons of CO₂ emission can be reduced annually.

Civil hot water, steam and heating industry: calculated as 1t/h boiler, the annual fuel cost can be reduced by 100 thousand. After the renovation of all of the boilers, over 20 million tons of CO₂ emission can be reduced annually.

IV. Part of Awards Received by Our Company in Recent Years

In 2003, Project “Research & Application of Regenerative HTAC Technology in Metallurgy Industry” won “The Second Prize of Metallurgy Science & Technology” issued by The CSM and CISA.

In 2003, the XRFS type continuous annealing furnace with regenerative (HTAC) gas radiant tube burner researched & developed by our company was successfully put into operation in the galvanized plate production line of Guangdong Foshan Guangheng Iron and Steel Co., Ltd, symbolizing that Shenwu has already arrived at the international advanced level in this field. The project won the second prize of Guangdong Province Science & Technology Progress Reward.

In 2003, the project “Industrialization of High-Efficiency, Energy-Saving and Low-Pollution HTAC Series Products” applied by Shenwu for technical innovation fund of science and technology type obtained the science & technology project loan of 14 million Yuan from Beijing Municipal Government with subsidized interest of 850 thousand Yuan.

In 2003, Project “High-Efficiency, Energy-Saving and Low-Pollution HTAC system” of our company passed the appraisal of BMSTC and obtained the certificate issued by the commission. The appraisal comment reads that the HTAC technology of Shenwu has reached domestically leading and internationally advanced level.

In 2003, the project “Research on Technology and Equipment of Regenerative (HTAC) Gas Radiant Tube Burner” of our company was listed in the National New & High Technology Research& Development Program (863 Program).

In 2004, Shenwu became the vice director unit of Energy Conservation Service Industry Committee of China Energy Conservation Association (EMCA).

In November, 2004, Shenwu won the second prize of Science & Technology Progress Reward of Beijing Municipal Machinery Industry.

In 2005, Shenwu was selected as “2005 Future Star-The Most Promising Medium and Small-Sized Enterprises in China” by the magazine CHINA ENTERPRISER.

On January 24, 2007, Shenwu was named as one of the “Top Ten Enterprises of China Energy-conservation Service Industry in 2006”.

In April, 2007, Shenwu enters the list of “100 Innovative Type Pilot Enterprises of Zhongguancun Science & Technology Park”.

In January, 2008, Shenwu won the awards of “Famous Brand“and “2007 Outstanding Contribution Award” of China energy-conservation service industry issued by EMCA of NDRC. Dr. Wu Daohong was elected as “Man of the Year” of 2007 China energy- conservation service industry.

In January, 2009, Shenwu was named as “2004~2008 Excellent Member Unit of EMCA” and “2008 Star Enterprise of China Energy Conservation Service Industry” in 2008 Summit of EMCA. The reheating furnace project of Shouqin Metal Material Co., Ltd (Qinhuangdao) built by our company was selected as “2008 Excellent & Demonstrative Project of China Energy Conservation Service Industry”.

In January, 2009, Shenwu was selected as one of the first batch pilot enterprises of Recycling Economy in Beijing.

In March, 2009, Shenwu and Dr. Wu Daohong was respectively awarded as “Enterprise of Outstanding Contributions for 20^th anniversary of Zhongguancun Park” and “Individual of Outstanding Contributions for 20^th anniversary of Zhongguancun Park” on the mobilization meeting for building Zhongguancun State Independent-innovation Demonstration Area organized by Beijing Municipal Committee of CPC and Beijing Municipal People's Government.

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