Contact Information: Contact: Synthesis Energy Systems, Houston, Texas Suzanne M. McLeod Manager, Investor Relations (713) 579-0602 suzanne.mcleod@synthesisenergy.com
SES and YIMA Sign Preliminary Agreement for Syngas to Methanol to DME Plant in China's Henan Province
Coal Gasification Plant to Supply Petrochemical and Transportation Fuel Needs
| Source: Synthesis Energy Systems
HOUSTON, TX -- (MARKET WIRE) -- May 3, 2007 -- Synthesis Energy Systems, Inc. ("SES" or the
"Company") (OTC : SYMX ), a coal gasification company involved in the
efficient conversion of low cost fuels into clean energy and chemical
products, and Yima Coal Industry Group Co. Ltd. ("YIMA"), a large Chinese
integrated coal company, have signed a preliminary agreement to establish a
joint venture company ("JVC") for a new integrated coal gasification to
methanol to Dimethly Ether ("DME") plant (the "Plant") in Henan Province,
China to help supply the region's growing petrochemical and transportation
fuel needs.
At the signing ceremony, Lorenzo Lamadrid, Chairman of SES, said, "This key
relationship -- our third project in China -- positions SES with one of
China's largest coal producers and one of the country's top companies
focused on the development of the coal-to-chemicals industry as an
environmentally responsible and viable alternative to supplying China's
rising energy demands. We are honored and eager to work with YIMA, as we
continue to expand our operations in China and worldwide."
The JVC will construct, own and operate the Plant, which will utilize the
Company's licensed U-GAS® technology to convert low-quality, high-ash
coals into a clean gaseous mixture called synthesis gas ("syngas"). The
syngas produced will then be used as a feedstock for the production of
methanol, a basic building block used in manufacturing for a wide variety
of chemical products including plastics, paints, construction materials, as
a hydrogen carrier for fuel cell applications, or as an alternative fuel.
In this application, the coal-derived methanol will also be used to produce
DME, an alternative to liquefied petroleum gas, liquid natural gas, diesel
and gasoline. The parties are also considering opportunities for power
generation applications. Formation of the JVC is subject to the
negotiation and execution of a definitive agreement and approvals from both
companies.
When completed, the Plant is expected to have a daily capacity of 10
million standard cubic meters of syngas and an annual capacity of 1 million
tons of methanol. The Plant's capacity will help support the rapidly
growing demand of Henan's industrial companies. With nearly 100 million
people, Henan is the most populous province in China and one of the
region's leading coal and aluminum production centers.
YIMA's Chairman Wu Yulu stated, "We are pleased to partner with SES and
believe the advantage of SES' U-GAS® gasification technology to convert a
wide array of low-quality coal, including high-ash fuels, into high-value
energy and chemicals in an efficient and environmentally acceptable manner
will provide our joint venture with a strong growth platform."
"This JVC is a step forward for China, as the country seeks solutions to
address its reliance on imports and offset the effects of rising oil prices
by accelerating its efforts to develop oil substitution programs that
utilize its vast deposits of coal. Using coal-derived methanol to produce
DME, and other clean fuels, can help meet China's and the world's need for
non-petroleum-based fuels and petrochemical feedstocks," concluded YIMA's
Chairman Wu Yulu.
Worldwide, SES is working to rapidly develop and commercialize alternative
energy and chemical projects, technologies and systems based on the clean
gasification of low-cost fuel sources and establishing U-GAS® as a
reliable and efficient alternative source of energy and chemical products
to manufacturers.
The Company currently is leveraging its engineering, procurement, and
project development expertise in China through two additional U-GAS® coal
gasification projects. The first facility, located in Shandong Province,
is about 75 percent complete with start-up anticipated by mid-summer of
2007 and commercial operations expected to begin by the third quarter of
this year. SES' second project, located in Inner Mongolia, is similar in
structure to the Plant in Henan -- an integrated coal gasification to
methanol to DME project. This second project is expected to break ground
by the end of this summer and be in operation by late 2008.
Among the dignitaries witnessing the signing ceremony were Madam Wu Yi,
Deputy Prime Minister of China, China's Minister of Commerce, and Sanmenxia
City Mayor Li Wenhui.
About Synthesis Energy Systems
Synthesis Energy Systems, Inc. is an energy and technology company that
deploys proprietary systems and technology to gasify low value fuels to
replace high cost energy and chemical products sold to major global
markets. The U-GAS® technology, which the Company licenses from the Gas
Technology Institute, is designed to turn waste coal products into high
value synthesis gas for use in power and chemical applications. The
technology performs this gasification without many of the harmful emissions
normally associated with coal fired energy production. SES currently has
offices in Houston, Texas and Shanghai and Beijing, China. For more
information on SES, visit www.synthesisenergy.com or call (713) 579-0600.
Forward-Looking Statements
Except for historical information contained herein, the matters discussed
in this press release contain forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section 21E
of the Securities Exchange Act of 1934, as amended that involve substantial
risks and uncertainties. When used in this press release and in any
documents incorporated by reference herein, the words "expects," "will" and
similar expressions identify certain of such forward-looking statements.
Actual results, performance, or achievements could differ materially from
those contemplated, expressed, or implied by the forward-looking statements
contained herein. These forward-looking statements are based largely on the
expectations of SES and are subject to a number of risks and uncertainties
that are subject to change based on factors which are, in many instances,
beyond SES's control. These include, but are not limited to, risks and
uncertainties associated with: our early stage of development, the limited
history and viability of our technology and our results of operation in
foreign countries. SES cautions that the foregoing factors are not
exclusive. SES assumes no obligation to update the information contained in
this press release.