Hainan Dongfang Henghe Energy Selects SES' Technology for Its Coal
Gasification Project in China
Henghe and SES Enter into Exclusive Period for License Negotiation While
Project Approvals are Obtained
HOUSTON, April 9, 2013
HOUSTON, April 9, 2013 /PRNewswire/ --Hainan Dongfang Henghe Energy
Development Company Ltd., ("Henghe"), based in Hainan Province, China, has
selected Synthesis Energy Systems, Inc. ("SES) (Nasdaq: SYMX) for a large
scale, 10 billion RMB (US$1.6 billion) coal waste to synthetic natural gas
("SNG") project in Jiangxi Province, China.
The Jiangxi Province project will be designed to convert coal mining wastes
into two billion normal cubic meters of SNG per year, and is expected to be
built in multiple phases. Both companies have agreed to work together
exclusively for this project over the next 12 months to complete commercial
agreements for licensing SES' technology as well as equipment supply and
service agreements. During this period, Henghe will manage development of the
project including obtaining necessary government approvals.
Ms. Li Jinmei, chairwoman of Henghe, stated, "We have confidence in SES'
technology as we see SES' Yima project begin operations. We believe the SES
technology is a good technology for China and is well suited for our Jiangxi
project because of its ability to cleanly and cost effectively convert our low
quality coal and waste coal for SNG production. We look forward to advancing
this project with SES and beginning construction sometime in 2014."
"Our track record of technology success in China, buoyed by the recent
start-up of our Yima Joint Venture plant, has resulted in a significant uptick
in inquiries from industrial companies and project developers looking to
utilize our coal gasification technology," said Robert Rigdon, president and
CEO of SES. "The Jiangxi project with Henghe is an ideal large-scale
commercial application of our technology for the conversion of very low
quality and low cost fuels into high-value products like synthetic natural
gas. We expect the project to require multiple SES gasifier systems and we
look forward to finalizing the commercial arrangements for our technology and
About Synthesis Energy Systems, Inc.
SES provides technology, equipment and engineering services for the conversion
of low rank, low cost coal and biomass feedstocks into energy and chemical
products. Its strategy is to create value through providing technology and
equipment in regions where low rank coals and biomass feedstocks can be
profitably converted into high value products through its proprietary U-GAS^®
fluidized bed gasification technology, which SES licenses from the Gas
Technology Institute. U-GAS^® gasifies coal cost effectively, without many of
the harmful emissions normally associated with coal combustion plants. The
primary advantages of U-GAS^® relative to other gasification technologies are
(a) greater fuel flexibility provided by the ability of SES to use all ranks
of coal (including low rank, high ash and high moisture coals, which are
significantly cheaper than higher grade coals), many coal waste products and
biomass feed stocks; and (b) the ability of SES to operate efficiently on a
smaller scale, which enables the construction of plants more quickly, at a
lower capital cost, and, in many cases, in closer proximity to coal sources.
SES currently has offices in Houston, Texas, and Shanghai, China. For more
information on SES and SRS, visit www.synthesisenergy.com or call (713)
About Hainan Dongfang Henghe Energy Development Company, Ltd.
Henghe is a limited liability company established in Dongfang City, Hainan
Province, China, with registered capital of Rmb 200 million. It has crude oil
depot operations and international intermediary trade as its main business.
Henghe maintains a variety of resources, social relations, upstream and
downstream clients and long-term connections.
SES Forward-Looking Statements
This press release includes "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. All statements other than
statements of historical fact are forward-looking statements. Forward-looking
statements are subject to certain risks, trends and uncertainties that could
cause actual results to differ materially from those projected. Among those
risks, trends and uncertainties are the early stage of development of SES, its
estimate of the sufficiency of existing capital sources, its ability to
successfully develop its licensing business, its ability to raise additional
capital to fund cash requirements for future investments and operations
including its China platform initiative, its ability to reduce operating
costs, the limited history and viability of its technology, commodity prices
and the availability and terms of financing opportunities, its results of
operations in foreign countries, its ability to diversify, its ability to
complete the restructuring of the ZZ Joint Venture, its ability to obtain the
necessary approvals and permits for its future projects, the estimated
timetables for achieving mechanical completion and commencing commercial
operations for the Yima project as well as the ability of the Yima project to
produce revenues and earnings, the sufficiency of internal controls and
procedures, its ability to effect the proposed ZJX/China Energy transaction
based on its ongoing discussions with ZJX and China Energy, its ability to
grow its business and generate revenues and earnings as a result of its
proposed China and India platform initiatives and its relationship with
Crystal Vision Energy, as well as its joint venture with Midas Resource
Partners. Although SES believes that in making such forward-looking statements
its expectations are based upon reasonable assumptions, such statements may be
influenced by factors that could cause actual outcomes and results to be
materially different from those projected. SES cannot assure you that the
assumptions upon which these statements are based will prove to have been
Important Notice from SES
In connection with the proposed ZJX/China Energy transaction, SES has filed a
preliminary proxy statement, and intends to file a definitive proxy statement,
with the SEC and intends to mail the definitive proxy statement to the
stockholders of SES. SES and its directors and officers may be deemed to be
participants in the solicitation of proxies from the stockholders of SES in
connection with the transaction. Information about the transaction is set
forth in the preliminary proxy statement filed, and will be set forth in the
definitive proxy statement to be filed by SES with the SEC.
You may obtain the preliminary statement and, when available, the definitive
proxy statement, for free by visiting EDGAR on the SEC website at www.sec.gov.
Investors should read the definitive proxy statement carefully before making
any voting or investment decision because that document will contain important
SOURCE Synthesis Energy Systems, Inc.
Contact: Synthesis Energy Systems, Inc., Kevin Kelly, Chief Accounting
Officer, (713) 579-0600, Kevin.Kelly@synthesisenergy.com, MBS Value Partners,
LLC, Matthew D. Haines, Managing Director, (212) 710-9686,
Matt.Haines@mbsvalue.com, Feintuch Communications (Media), Richard Anderson,
Senior Managing Director, (718) 986-1596, SES@feintuchpr.com
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