PINGDINGSHAN, China, Oct. 8, 2014 (GLOBE NEWSWIRE) -- SinoCoking Coal and Coke Chemical Industries, Inc. (Nasdaq:SCOK), an emerging producer of clean energy products located in Henan Province, today announced new developments in the construction and financing of its underground facility for the production of clean-burning syngas.

First, SinoCoking confirmed that the initial phase of construction on the project will commence this month and, when completed in March of next year, produce 60,000 cubic meters of syngas per hour. At this facility, to be constructed near the company's four mines in Henan Province, SinoCoking will employ the patented underground coal gasification (UCG) and carbon capture and storage (CCS) processes developed and jointly owned by its two technology partners – the Institute of Process Engineering of the Chinese Academy of Sciences and the North China Institute of Science and Technology – both of which on September 9 granted SCOK the exclusive right to commercialize both processes.

According to Dr. Wenjun Li of the North China Institute of Science and Technology, this underground facility will be the first in China to deploy both UCG and CCS technologies together in a commercial venture. Dr. Li, who has spent the last 11 years developing and testing these processes in mines deep underground and who authored many of the UCG patents, said he believed that the combination of both technologies would constitute "a leading scientific and environmental achievement" and permit China to "significantly accelerate" the pace at which it combats "destructive atmospheric pollution and global warming effects."

In the UCG phase of the process, said Dr. Li, two wells will be drilled into the mine's coal seam, with one well being used for injection of agents to ignite and gasify the coal in the seam, and the other well used to bring the resulting gases to the surface. These gases include carbon monoxide, hydrogen, methane, carbon dioxide and steam, the latter two of which are subsequently removed, leaving a syngas of carbon monoxide, hydrogen and methane usable as a clean-burning fuel or as an intermediary product that may be converted to fertilizers, solvents and assorted synthetic materials.

During the CCS phase of the process, he said, the removed carbon dioxide and steam are re-injected deep underground, where they further stimulate the coal gasification process and remain stored for decades, unable to contribute to global warming or atmospheric pollution.

The entire UCG/CCS process, said Dr. Li, is especially formulated to prevent the toxic groundwater contamination that has often resulted from competing technologies. This advance, he said, will be made possible by use of a patented drilling technology, specialized gasification agents, and automated systems that monitor and control the temperature of the gases traveling through the wells.

SinoCoking plans to fund the project's initial $18 million cost with approximately $6 million coming from operating cash flow, $6 million anticipated from bank loans, and $6 million from proceeds of the company's recent $14.3 million equity offering.

Each step of the project construction will be co-supervised by Dr. Li and the technical operations team of SinoCoking. This construction process will form the basis of a model that may be applied at future UCG/CCS sites, he said.

"SinoCoking was the ideal partner for us on this project," said Dr. Li. "First, the company has a very strong coal production infrastructure in place, ensuring a huge supply of coal to produce syngas on an ongoing basis. Second, Henan Province, where SinoCoking's four mines are located, has many large industries that are in need of syngas and form a natural customer base.

"Third, the Henan Province Government, as well as governments of the district and county, are very supportive of SinoCoking's commitment to this project, and we look forward to cooperating with them to make the project a success."

SinoCoking chief executive Mr. Jianhua Lv added, "After years of research by Dr. Li and some of the finest minds in China, our team is proud and excited to step into the forefront of UCG/CCS technology. With our two Institute partners we stand ready to advance our nation's efforts to reduce its reliance on the burning of coal for energy and to create a cleaner and healthier environment for all our citizens."

The CEO said that subsequent phases of SinoCoking's UCG/CCS project, estimated to cost $280 million and produce as much as 880,000 cubic meters of syngas per hour, will be funded by a combination of operating cash flow, bank loans and, possibly, an equity raise.

Mr. Lv said that SinoCoking would soon issue an update on the opening of the company's aboveground syngas facility in Pingdingshan, due to begin operations this month.

About SinoCoking

SinoCoking and Coke Chemical Industries, Inc. (, a Florida corporation, is an emerging producer of clean energy products located in Pingdingshan, Henan Province, China. The company is currently transitioning from its former identity as a vertically-integrated coal and coke processor that uses coal from both its own mines and that of third-party mines to produce basic and value-added coal products for steel manufacturers, power generators, and various industrial users. SinoCoking has been producing metallurgical coke since 2002, and acts as a key supplier to regional steel producers in central China. SinoCoking also produces and supplies thermal coal to its customers in central China. SinoCoking currently owns its assets and conducts its operations through its subsidiaries, Top Favour Limited and Pingdingshan Hongyuan Energy Science and Technology Development Co., Ltd., and its affiliated companies, Henan Province Pingdingshan Hongli Coal & Coke Co., Ltd., Baofeng Coking Factory, Baofeng Hongchang Coal Co., Ltd., Baofeng Hongguang Environment Protection Electricity Generating Co., Ltd., Zhonghong Energy Investment Company, Henan Hongyuan Coal Seam Gas Engineering Technology Co., Ltd., Baofeng Shuangri Coal Mining Co., Ltd., and Baofeng Xingsheng Coal Mining Co., Ltd.

Further information about SinoCoking is disclosed in our periodic reports filed with the Securities and Exchange Commission.

Forward Looking Statements

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SinoCoking: Investor Relations:
Song Lv, Chief Financial Officer Rick Eisenberg, Asia IR•PR.
+ 86-375-2882-999 +1 (212) 496-6828