Ningdong Energy and Chemical Industry Base is positioning coal-to-chemicals as a strategic alternative to oil-based production, with the hub emerging as a key player in China's energy security push.

The base, located in central-eastern Ningxia Hui autonomous region, spans a planned area of 4,450 square kilometers (with a core zone of about 800 square kilometers) across two prefecture-level cities and five counties.

It forms part of the Yinchuan metropolitan area and serves as a national key development zone, a major coal production base, a coal-fired power base under the west-to-east power transmission program, and a demonstration zone for modern coal-to-chemicals and circular economy.

Together with Yulin in Shaanxi and Ordos in Inner Mongolia, it forms the "golden triangle" of China's energy and chemical industry.

The base's modern coal-to-chemicals sector has been designated a national advanced manufacturing cluster. Coal-to-liquids output exceeded 4.6 million tonnes, maintaining the largest single-unit scale in China, with the complete technology set winning a first prize in the National Science and Technology Progress Awards and the "Shenning gasifier" earning a China Patent Gold Award. Coal-based olefin capacity reached 4.2 million tonnes, more than one-fifth of the national total.

The base has also built China's most promising high-performance fiber production site, with spandex capacity of 227,000 tonnes ranking third nationwide and earning the title "China Spandex Valley", while para-aramid capacity of 16,500 tonnes ranks first in the country.

In 2025, the base's gross industrial output remained above 200 billion yuan, with value-added output from industrial enterprises above designated size rising 11% year on year, contributing more than 50% to Ningxia's overall industrial growth. It was ranked fourth among competitive chemical industrial parks during the 14th "Five-Year Plan" period.

This year, Middle East conflicts have disrupted the global crude oil market, with insufficient supply and rising prices weighing heavily on the downstream petrochemical industry, further highlighting the advantages of coal-to-chemicals.

Ningxia Baofeng Energy Group Co., Ltd., a flagship enterprise at the base and a leading domestic coal-to-olefins producer, has built a modern coal-to-chemicals circular industrial cluster while expanding overseas and accelerating its green technology transition. The recent media tour focused primarily on enterprises within the base, including Baofeng Energy.

Baofeng Energy operates two major bases — one in Ningdong, Ningxia and another in Ordos, Inner Mongolia. The company uses coal and green hydrogen as feedstock to produce high-end polyolefin materials, reducing China's olefin imports by 6 million tonnes annually and making it a major global polyolefin supplier.

Liu Yuanguan, president of Baofeng Energy, said in an interview that China consumes about 700 million tonnes of crude oil annually, of which 500 million tonnes are imported, putting the country's import dependency above 70%. Polyolefins and other chemical products are hydrocarbons that can be produced from both crude oil and coal, he said.

Based on Baofeng Energy's annual polyolefin output, producing the same volume from crude oil would require 30 million tonnes of oil, or 6% of China's annual crude imports. Coal-to-olefins costs are significantly lower than oil-based production, giving it a clear cost advantage. As core technologies and key equipment for coal-to-chemicals achieve domestic breakthroughs, the sector's advantages in technology and product quality will become increasingly prominent.

The company's high-end products are exported to Belt and Road partner countries including Kazakhstan and Turkey, helping stabilize regional industrial chains. Baofeng Energy has also partnered with research institutes and leading enterprises on 23 domestic technology and equipment items that have reached internationally advanced levels, injecting momentum into China-Arab economic cooperation and the green energy transition.

Baofeng Energy's first-half 2026 report showed revenue of about 30.2 billion yuan, up 32% year on year, and net profit attributable to shareholders of 9.7 billion yuan, up 70% year on year.

Ningxia Coal Industry Co., Ltd., also based at the hub, has abandoned the traditional approach of simply mining and selling coal at low prices, instead leveraging integrated production, sales, research and application to convert coal into fuels, waxes and chemical materials.

The company has invested 5.46 billion yuan in research over the past decade, tackling 37 major domestic technology tasks with a 99% localization rate for key equipment, and has built the world's largest single-unit coal-to-liquids project.

By building a full industrial chain spanning coal, oil, chemicals, new materials, carbon utilization and new energy integration, Ningxia Coal's coal-to-chemicals segment has replaced coal mining as the company's top profit driver.

The company now produces 35 product types across five categories — oils, waxes, gases, materials and fine chemicals — raising the value per tonne of coal by more than seven times.

The Ningdong base also has 17.35 GW of coal-fired power capacity and 15 GW of power transmission capacity, making it a major national coal-power base safeguarding electricity supply in northern and eastern China.

It has implemented the world's largest solar-powered water electrolysis hydrogen project, with green hydrogen capacity of 28,000 tonnes ranking third nationwide, contributing significantly to China's energy security and petrochemical industry safety.