The Project Summary

Name: 10 furnaces with the capacity of 12500kva Industrial Silicon Project
Construction: silicon raw owe processing system, industrial silicon metallurgical production lines and auxiliary equipment
Capacity: annual production 50,000 ton chemical industrial silicon
Operation: 300 days a year; GB2881-91 technical criteria
Site: Pengshui County, Chongqing Municipality, P. R. China

Benefits
- The total reserve in Pengshui County has identified to be 160 million ton.
- Easy access: it is 270 km between Pengshui county to Chongqing Municipality, China’s youngest and largest municipality.
- Power supply: In 2002 the power generated reached 81 million KWH supplying 105.68 million kwh. In 2005 the installed capacity reached 60,000KW generating 20,000kwh.
- In order to balance the development between East and the West, the Chinese Central Government provide a wide range of incentives to encourage foreign investment and involvement in the economic development of the West. Chongqing is leading in this national campaign
- Compared to the Southern and Eastern regions in China, the West has strong advantage of up to 2/3 cheaper land and labour costs.
- China’s demand for industrial silicon has increased to over 1 million ton, more than 50% of the world’s total. The demand is increasing with the development of ICT, aerospace, machinery and chemical industry on the global scale.
- Currently among the 300 companies developing industrial silicon mines in China, the vast majority utilise the smaller furnace of 3,200-6,300 KVA, which will be gradually kicked out of the market due to the poor energy efficiency. The Project in Pengshui aims at energy efficient production line and will deal with wast in a responsible manner. It will be strongly support by the Chinese government

Investment: RMB 58.97 million yuan (£1=RMB 15 yuan)
- Construction capital: 20.5 million yuan
- Cash flow: 36.59 million
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Invest Items Capital (10,000 RMB yuan) Percentage %
Site construction 6,300 30.73
Equipment 10,500 51.22
Installation 1,100 5.37
Others 2,600 12.68
Total Investment 20.500 100

Estimate sales income: 487.59 million RMB yuan per annum (based on the currently Chinese market price)

Progress To Date:
August 2007: The project is established and approved by the government
September 207: Feasibility Study complete
September 2007: Mineral Resource Survey Report complete (by 107 Geological Team, Chongqing Geological Mineral Survey Bureau)