BEIJING, July 23 A project operated by China's
largest coal miner, Shenhua Group, has reduced groundwater
levels in a region of Inner Mongolia and discharged high levels
of toxic wastewater, environmental campaign group Greenpeace
said on Tuesday.
The report, the first by Greenpeace to single out and
publicly challenge one of China's powerful state-owned
companies, comes as the country's new leadership steps up its
focus on pollution amid growing protests over environmental
China recently cancelled plans to build a $6 billion uranium
processing plant after hundreds of protestors took to the
streets.. Other petrochemical projects have also
been cancelled after mass demonstrations.
Shenhua's coal-to-liquid pilot close to Ordos city is one of
three such projects operating in China. It has drained more than
50 million tonnes of groundwater from the Haolebaoji region
since 2006, Greenpeace said in the report.
"We are taking these allegations very seriously and we will
start our own investigations into the project to ensure that it
meets all environment-related regulations," a spokeswoman from
Shenhua Group said.
"We will release our own environmental report on the project
after the investigation."
The Greenpeace investigation, which the group said was based
on 11 field trips to the Shenhua project from March to July this
year, found high levels of toxic chemicals in discharged
wastewater. It said many other carcinogenic compounds were
identified in sediment samples.
"Shenhua claims its coal-to-liquid project has 'low water
consumption' and 'zero discharge'. Our investigation proves
these claims are false," Greenpeace East Asia campaigner Deng
"Shenhua's practices are violating Chinese water resource
principles and laws controlling industrial waste water
Shenhua's coal-to-liquid project has a production capacity
of 1.08 million tonnes a year, with plans to expand to 5 million
Plans to scale up the project would see its water use triple
to 41 million tonnes by 2017, according to Greenpeace.
Coal-to-liquid technology turns the traditional fuel into
petrochemicals. The process has long been controversial due to
its high water and energy needs but with slowing growth of coal
power generation, China's coal companies are seeking new
markets. More than 100 coal chemical projects are currently
waiting for approval, said Li Yan, Greenpeace climate and energy
"This is why we chose to stand out against a big iconic
project like Shenhua coal-to-liquid at this time as it's still
possible that some major decisions can be shifted because of
The Ordos city government has also claimed damage caused by
Shenhua's coal-to-liquid project in two notices published on its
website, pointing to reduced groundwater levels, irrigation
problems, and a lack of safe drinking water for residents. It
cited petitions from residents and warned of the threat to
social harmony, recommending the relocation of farmers and
compensation for water losses.
(Reporting By Dominique Patton; Additional reporting by Fayen
Wong; Editing by Michael Urquhart)