Joint funding & cooperation of 1750 mm cold rolled
sheet steel project

Dalian Dongzhan GroupCo., Ltd. was established on April 2001(hereinafter called Dongzhan Company for short). Since its establishment, Dongzhan relied on the support of Beitai Company, and it has already taken shape as a comprehensive group enterprise, which based on steel trade, including international trade, domestic trade, logistics service, financial mortgage, wood and plastic industry, hotels and catering through modernized management. Dongzhan now is with the following business natures as staffs of more than 800 people, the annual trade volume of RMB15.7billion Yuan, 10 million tons of transport capacity, 1 billion Yuan of financial transaction, and the annual capacity of 300,000 square meters of wood and plastic doors and windows.
In recent years, the demands in domestic market for cold rolled steel sheet are vigorous, while the capacity is relatively insufficient. In order to grasp market opportunity, further improve products competition edge on the market and develop sheet products further processing, Dongzhan Company plans to set up a domestic advanced cold rolled sheet plate project with investors from both domestic and abroad. And bring the advantage of policies dominance of the coastal city into built the cold rolled steel sheet project with the world advanced level.
I. Construction content of the project and investment estimated
1. Construction content of the project
Beigang Group plans to build a project of cold rolled steel sheet in Dalian, a coastal city in Liaoning Province, which will form an annual capacity of 1.5 million tons rolled steel. Amongst which 0.8 million tons of cold rolled steel sheet, and 0.35 million tons of hot dip galvanized steel coils based on automobile home appliances, and 0.35 million tons of hot dip galvanized steel coils based on home appliances building materials. And we reserved 0.12 million tons coated rolled steel sheet capacity. The specification of finished products is as follows:
a. Cold rolled steel sheet
Thickness：0.3～2.0 mm
Width： 750～1600 mm
Weight： 5t～ 20t (max.)
b. Hot dip galvanized steel coils
Thickness：0.25～2.5mm
Width： 750～1600mm
Weight： 15～20t (max.)
2. Estimated investment and the profit analysis
The total investment of this project is RMB 4941.016 million Yuan , including static investment RMB 4562.526 million Yuan(including foreign exchange 264.7756million dollars), dynamic investment (loan interest in construction period) RMB 186.91 million Yuan, minimum fluid fund RMB 191.58 million Yuan.
After the project being put into operation, there shall be sales revenue of RMB 6655 million Yuan, and total net profit of RMB 380.32 million Yuan. And the internal profit margin is 10.2 %, the investment recovery is 10.4 years (Including construction period).There shall be significant economic benefits.
II. Selection of the techniques and equipments of the project
The project adopts the most advanced technology of acid Pickling and rolling machinery. The main equipment types include acid pickling and rolling line, hot-dip galvanizing line, color-coating, bell type annealing furnace, single-stand skin pass mill, cross cutting line, recoiling and coil splitting line, sheet steel packaging line, coil steel packaging line and so on. The key equipments of the project shall be imported from abroad, and others shall be supported by domestic manufacturers.
III. Market analysis
As for productivity, according to an undercount, the accumulated consumption of the cold rolled steel sheet was 17.17 million tons in 2004 in China, while the total domestic capacity was only 10.58 million tons, which hold 61.6% of the domestic cold rolled steel sheet market, and the rest relies on import, so there is a bright future for the market. As for the specification of the products, most of the cold rolled steel sheet in China is with thickness of over 1.0 mm. At present, there are only few manufacturer may offer the cold rolled steel sheet with thickness of less than 0.5 mm, and the capacity is only about 0.7 million tons, which could not meet the domestic demand. Especially the output of the automobile industry increasing fast, and also with the increasing consumption of the galvanized steel sheets and tin steel sheet and color-coating sheets, the demands for high quality and thin cold rolled steel sheet increases fast. Amongst the thin cold rolled steel sheet imported, there are 8.0891 million tons of cold rolled steel sheet with thickness of less than 1mm, which occupies 83.85 % of all the cold rolled steel sheet imported.
It can be said that, products of cold rolled steel strip project of Dongzhan Company is marketable goods, which will have a tremendous market in the future.
V. The project advantage
1. The policy advantage
The state council has proposed for the strategy of revitalizing the northeast provinces old industrial bases, which offers serials of policies for the state-owned enterprises in northeast provinces. And this project was also concerned and supported by the Liaoning provincial government, Dalian municipal government, and some other financial institutions.
2. The human resource advantage
Dongzhan Company has a strong management team, which is with high efficiency, and rich experiences of enterprise building and management, and it will provide excellent management human resource for the projects. Additionally, Beitai Company, the parent company of Dongzhan Company has many experiences of steel industry for several decades, and it has grasped many skills in the steel manufacturing, and it cultivated a huge team of management and technical human resources, which shall provide many comprehensive staffs with strong technology ability, skills and knowledge.
3. Project advantage
Northeast provinces are the old national industrial base, while there are insufficient high quality and high level of cold rolled steel sheet and further processing cold rolled steel strip there. Therefore, there is a bright future for the market if a set of high initiation and high level cold rolled steel strip and further processing cold rolled steel strip line can be built, so as to manufacture the cold rolled steel strip products being eagerly demanded by market.
4. The raw material advantages
The hot rolling coil steel needed for the project is supported by the 1780mm hot rolling steel factory being built by Beitai Company, which will ensure the raw material resource.
5. Transportation advantage
The address of the project was at the costal city of Dalian, where is located in coastal areas and owns the advantage of the geography and transportations, and the materials shall be transported by the sea shipping directly to the port, and the products shall also directly ship to Shanghai, Guangdong, Tianjin and other costal industrial city by sea shipping or be imported overseas. Additionally, there are advantage of the regional highway and the railway shipping facilities, where is the best geographical situation.
6. Outstanding sales net work
As for the sales of the products and the services after the deals, Dongzhan Company has established fine relationships with many steel consumption clients, after the project being completely and being put into operation, we shall utilize the existed sales net work, and occupy the Market ASAP.
VI. Pattern of Cooperation
According to Company Law, Joint Venture Law, Cooperative Enterprise Law as well as relevant laws and rules & regulations, both partners can legally found joint venture and cooperative enterprises. Investors can invest with cash and equipment and hold joint ventures. Partners can also cooperate with us in the form of finance leasing and compensation trade. The detailed cooperation program and investment value will be determined through mutual consultation.

Joint-funding & Cooperation of Hot-rolled Pickled and Hot Dip Galvanized Steel Sheet

Beiying Iron & Steel Company (hereinafter short for Beiying company) is located in Beitai Town, Benxi City, Liaoning province. The company boasts unique iron mine resources, and complete iron & steel production system, including mine, sintering, coking, power generation, iron making, steel making and steel rolling. It’s a large-scale production base of quality iron & steel products in Northeastern China. At present, it has formed annual production capacity: 8 million tons of pig iron, 8 million tons of concast steel billets, 6.5 million tons of finished steel. Major products: pig iron, concast billets, slab, rectangular billets, spiral steel, wire rods, medium-width steel strip etc. All it’s products are made of ginseng iron, and high quality. Until 2012, Beiying company’s annual production capacity will reach 10 million tons of iron, steel, and rod.
In recent years, the strong support of increasing demand of automobiles, home appliances and other related downstream industries, moreover high market demand of Galvanization Sheet, and market prices relatively stable at a high price, and the inadequate of Galvanization Sheet’s capacity, all of these provide Galvanization Sheet a broad market space for. In order to grasp the market opportunity, BeiYing company intends to cooperate with foreign and domestic investors, bring the advantage of BeiYing company into built the Hot-rolled Pickled and Galvanization Steel Sheet projects with the world's advanced level.
Ⅰ. Construction content of the project and investment estimated
1. Construction content of the project
The annual production capacity of Hot-rolled Pickled Steel Sheet and Galvanization Sheet project is 80 tons, Amongst which 0.35million tons Hot-rolled Pickled Steel Sheet, and 0.45million tons Galvanization Steel Sheet. Specification of finishing products is as followed:
a. Hot-rolled Pickled Steel Sheet:
Thickness: 1.2-6.0mm
Width: 850-1600mm
b. Hot-rolled Galvanization Steel Sheet:
Thickness: 1.2-4.0mm
Width: 850-1600mm
2. Estimation of the project
The total investment of this project is RMB 603.8941 million Yuan, including static investment RMB 549.8961 million Yuan, dynamic investment (loan interest in construction period) RMB 23.191 million Yuan, minimum fluid fund RMB 30.807 million Yuan，the construction period is 18 months.
After calculation, after the project reaches the designed capacity, the annual average sales revenue will reach RMB 3.300855 billion Yuan, and annual average sales profit RMB88.312 million Yuan. After-tax profits 59.169million Yuan, After-tax internal rate of return is 12%. The recovery period for total investment is 9.3 years. The loans maturity is 7.1years (including construction period).
Ⅱ. Selection of the techniques and equipments of the project
The main equipment of this works includes a push-and-pull pickling machinery, a hot galvanizing machinery and a mill roller equipment plant etc. BeiYing company intends to adopt the technology and process which are researched and developed by the powerfully domestic manufacturers, and a small number of key equipment properly. Moreover the machinery suppliers assume overall responsibility for technology. Accordingly, BeiYing company intends to adopt hydrochloric acid-wash process turbulent shallow groove for the pickling machinery, and uses a push-pull pickling machinery in accordance with requirement of the scale of production, products, organizational flexibility and limiting investment. In accordance with the position of hot galvanized products and the characteristic of Galvanization plate, BeiYing company intends to adopts modified Sendzimir process as the mainly process of hot-rolled galvanized steel strip machinery.
Ⅲ. Market analysis
1. Pickling steel sheet market analysis
With the gradual and steady development of China's economic construction, every walk of life’s requests are increasingly for the type and specification of steel. Pickling is a developing variety of steel, the current market demand mainly concentrated in automobiles, compressors, machinery, spare parts processing, fans and motorcycle industry and steel furniture, hardware accessories, shelves and counters and various shapes stamping parts. With technological advances, hot pickling plate has been applied to home appliances, containers, and the electrical control cabinet and other industries. The industries which use hot plates instead of cold-rolled plates pickling have a rapid development.
At present, many enterprises requests to the high-performance and low-cost of steel. With the advances on rolling technology and process, the performance of hot rolled sheet is closing to cold-rolled plates’. Pickling sheet has a high ratio of performance and price, that ratio is between cold-rolling plate and hot-rolling plate’s, so Pickling sheet has a good market prospect.
The utilizing of Pickling sheet just takes its first step in various industries. The professional pickling production only started from the Pickling line which produced by BaoSteel company in September 2001. So far, only BaoSteel company and HanDan Iron and Steel company own the pickling line, it means that the market of Pickling sheet is waiting for tapped.
2．Hot Galvanized steel sheet market analysis
Galvanized sheet mainly used for construction, light industry, automobile, agriculture, animal husbandry, fishery and commercial etc. In 2005, Galvanized sheet consumption was 8.69 million tons, an increase of 8.3% comparing with the same periods before. Although the growth of China's output of Galvanized sheet was so fast, it still failed to meet the demand. In 2005, the domestic market share of Galvanized reached 54.7%, it still had wild space for development.
Ⅳ. Advantage
1. Policy advantage
Hot-rolled Pickled and more than 250,000 tons of Galvanization Steel Sheet were encouraged by the state industrial policy. Therefore, the construction of Hot-rolled Pickled and Galvanization Steel Sheet project meet the state iron and steel industry development policy.
2. Talents advantage
Beigang group has a strong, united, and efficient leadership team with rich experiences in enterprise construction and business management. Additionally, Beigang has tens of years of experience in iron & steel making, master much technical know-how in aspect of iron & steel making, and bring up a lot of talents on production, management and technology.
3. Raw materials advantage
After the 4million tons 1780 continuously hot-roll Strip Steel Project of BeiGang Group finished, it is not only providing the finished hot-roll steel coil for market, but also providing raw materials coil of further processing . Therefore, the supply of raw materials is very ample for Hot-rolled Pickled and Galvanization Steel Sheet project.
Ⅴ. Modes of joint-funding & cooperation
According to Company Law, Joint Venture Law, Cooperative Enterprise Law as well as relevant laws and rules & regulations, both partners can legally found joint venture and cooperative enterprises. Investors can invest with cash and equipment and hold joint ventures. Partners can also cooperate with us in the form of finance leasing and compensation trade. The detailed cooperation program and investment value will be determined through mutual consultation.

Joint Funding & Cooperation of 900 Cold-rolled Strip Steel Project

Dalian Dongzhan Group Co., Ltd. (hereinafter short for Dongzhan Company) was established in April, 2001. It belongs to business & trade part of Beitai Iron & Steel Group Company, and a comprehensive enterprise group integrating domestic & foreign trade, logistics, financial pawn and wood products processing on the basis of business &trade and logistics of Beitai Iron & Steel Group Company. At present, it has a total employee of over 600. The annual business revenue is RMB 20 billion yuan. The annual transportation capacity is 100 thousand tons. The pawn business revenue is RMB 1 billion yuan. The annual productivity of wood window is 300 thousand m2.
In recent years, the domestic consumption of cold-rolled sheet is on the rise year by year. However, the total supply is insufficient. The production growth lags behind consumption growth. The demand on thin-specifications sheet is big and mainly relies on imports. In order to grasp the market opportunity, Dongzhan Company intends to cooperate with foreign and domestic investors, bring the advantage on policies and geographical environment of coastal cities into full play and build 900 cold-rolled steel sheet project with domestically advanced level.
1. Project construction content
The project intends to pickling machinery set, reversible cold rolling machinery bell-top annealing furnace machinery, leveling machinery, recoiling machinery and etc. The annual productivity of steel coiling is 170 thousand tons.
The product specifications is: thickness 0.2~1.5mm, breadth 450~700mm.
Steel varieties: carbon structure steel, quality carbon structure steel, low alloy steel and etc.
Typical steel grade: CQ(40%), DQ（30%）, DDQ（20%）, St37, St44, HSLA, 05CuPCrNi（10%）
The product is produced according to GB708 and other standards. The production can also be done according to internationally advanced standard upon customers’ or market demand.
2. Production process and main equipment
(1) Production process
As raw materials, hot-rolled coiling is pickled through pickling machinery, which aims at oxidized layer. Then it’s rolled reciprocally in cold rolling machinery for 3~7 times to a certain thickness. It’s then annealed in annealing furnaces in order to remove processing stress and finished in leveling machinery. For thin strip steel, it will be finished in straightening machinery. Then the product is edge-cropped, recoiled, packed and delivered.
(2) Main equipment
① Pickling machinery adopts push-and-pull hydrochloric acid tandem pickling equipment
②Cold rolling mill adopts six high single stand HC reversible rolling mill. The roll breadth is 900mm. It has two stands.
③Annealing furnace adopts gas circulating bell-top annealing furnace. Decomposed gas from ammonia is used as protection gas.
④Leveling machinery adopts single- stand four-high irreversible leveling equipment.
3. Market analysis
In recent years, the consumption of cold rolled sheet is on the rise year by year, whereas, the supply is insufficient. The production growth lags behind consumption growth. The demand on thin-specifications sheet is big and mainly relies on imports. The proportion of deep processed steel sheet is too low.
According to prediction of authoritative department, in the field of production energy, the production energy of domestic cold rolling mill will reach 42.74 million tons. The total consumption of cold-rolled sheet will reach 53.2 million tons. There is still gap of 10.5 million tons and the market prospect is bright. In terms of specifications, for domestically produced cold rolled steel sheet, the majority of thickness is over 1.0mm. At present, only several enterprises can supply cold rolled sheet with under 0.5mm thickness, which cannot meet the domestic market demand. We can say, the cold rolled sheet project products of Dongzhan Company are the right products for market need. The market prospect is very bright.
4. Investment estimation and efficiency analysis
The total investment of the project is RMB 0.55613 billion yuan, among which the fixed assets investment is RMB 0.52485 billion yuan, interest in construction period RMB 9.21 million yuan and minimum fluid fund RMB 22.08 million yuan.
After the project is put into production, the annual sales revenue will reach RMB 0.884 billion yuan, the annual sales cost RMB 0.70409 billion yuan, annual sales profit RMB 0.14619 billion yuan, annual value added taxation RMB 33.72 million yuan and income tax RMB 48.24 million yuan. The annual total tax and fees can reach RMB 81.96 million yuan. The internal rate of return is 21.94%. The recovery period for total investment is 5.55 years. The loan payoff period is 4.16 years.
5. Project advantage
(1) Market advantage
Northeastern China is China’s old iron & steel industrial base. However, its capacity of high-quality and high-level cold-rolled and deep processed products is very poor. Therefore, there will be bright market prospect to build a cold-rolled and deep processed production line with high startup and high level to produce cold rolled products, which are in urgent need on the market.
(2) Policies on urban construction and geographical transportation advantage
The factory site is located in the coastal city-Dalian, which is of convenient geographical location and transportation facilities. Raw materials can be directly delivered to seaport by sea transportation. The finished products can be directly delivered to coastal cities, such as Shanghai, Guangdong, Tianjin, or exported by sea transportation. In addition, the highway and railway transportation facilities in coastal and seaport regions are also very convenient and enjoy unique geographical advantage.
Meanwhile, as the most open coastal city in Northeastern China, Dalian city provides many preferential policies for investors.
(3) Excellent sales network
In terms of product sales and post sales service, Dongzhan Company built excellent demand & supply relations with many steel users. After the project is finished and put into production, product sales can quickly win market by virtue of the existing sales network.
(4) Stable supply of raw materials
All hot rolled coiling needed for the project come from Dongzhan’s parent company, i.e., Beigang’s existing hot rolled medium strip production line. Both partners signed an agreement, which guarantee stable supply of raw materials.
6. Mode of cooperation
According to Company Law, Joint Venture Law, Cooperative Enterprise Law as well as relevant laws and rules & regulations, both partners can legally found joint venture and cooperative enterprises. Investors can invest with cash and equipment and hold joint ventures. Partners can also cooperate with us in the form of finance leasing and compensation trade. The detailed cooperation program and investment value will be determined through mutual consultation.

Joint funding & cooperation of utilizing steel slag to process Sialite powder

Sialite is a new-type building gelatination material. The project aims to fully use blast furnace steel slag produced in the process of iron making, which is energy saving and friendly to environment. In comparison with traditional cement process, the process of Sialite powder has the characteristics of firing free, low-cost raw materials, low production cost, high strength and etc. The new process will become development direction for production of building materials and has bright market prospect.
1. Project content
(1) Production scale
The annual production of Sialite powder is 2 million tons. Fineness is 4900 bores/ cm2. The annual production of blast furnace slag is 1.904 million tons( calculated according to 12% hydration).
(2) Project process
The construction period is one year. In the second year, the project will be put into production and reach the designed capacity.
(3) Main process & equipment
The main process & equipment is in light of the principle of setting footing in China. The main process & equipment, including crusher, baking machine, powder grinding machine, powder dressing machine, packaging machine, can realize imports substitution.
(4) Investment estimation and economic appraisal
The total investment is RMB 169 million yuan. The loan interest in construction period is RMB 3.6 million yuan.
After the project is put into production, the annual sales revenue will reach RMB 400 million yuan, annual average after-tax profit RMB 50.7 million yuan, the after-tax internal rate of return 33.41% and after-tax investment recovery period 4.08 years( including construction period).
(5) Energy consumption
The electricity comes from No.2 transformer substation. Industrial water, daily life water and coal for heating come from Beigang Iron Making Plant through relevant piping network.
2. Project advantage
(1) Policy advantage
Chinese government put forward the strategic goals for revitalizing the old industrial base in northeastern China and provides a series of favorable policies for state-owned enterprises in the three provinces of northeastern China.
The state council promulgated No.369 decree for encouraging clean production and provides favorable policies for newly-emerged industries and products with comprehensive utilization of steel slag.
(2) Advantage on raw materials
Beigang can provide ample supply of the raw materials of blast furnace slag and coal powder. For heating of mineral slag baking machine, we can use blast furnace gas from Beigang Iron Making Plant or remaining heat of blast furnace hot wind.
(3) Economic and environment-friendly efficiency
The project production uses industrial slag, which are energy saving and friendly to environment, reflecting the mainstream of clean materials and green technologies. Meanwhile, the low-cost industrial slag and coal powder provide huge space for added value, and bring handsome economic efficiency for enterprise.
(4) Product property and cost advantage
In comparison with traditional cement, Sialite products has advantage of water-proof and moisture-proof free, manually controllable solidification time and high strength. Meanwhile, in comparison with cement, the production cost of Sialite products is 30~50% lower, comprehensive energy consumption 60~70% lower, and infrastructure investment 50~60% lower.
(5) Complete public auxiliary facilities
The factory site is located to the north of Beigang Iron Making Plant. The factory covers an area of nearly 100 thousand m2. The electricity comes from No.2 transformer substation. Industrial water, daily life water and coal for heating come from Beigang Iron Making Plant through relevant piping network.
3. Mode of joint funding and cooperation
Beigang will use the existing land, public facilities and fund as its investment. Cooperation partner can invest in the form of fund, technologies, equipment and etc., and legally establish joint venture. The detailed cooperation program and investment can be determined through mutual consultation. The cooperation partners participate in the business according to their respective investment proportion, enjoy the profit distribution and assume corresponding risks.

Joint Funding & Cooperation of High-strength Low Tensile Pre-stress
Steel Wire

With the increasing requirements on steel grades and quality for China's infrastructure, the demand on pre-stress steel products increases apparently. The market demand on pre-stress and steel twist wires will reach 1.45 million tons per year before 2015. Its application scope is being widened rapidly in such fields as pre-stress steel structure, railway and highway bridges, urban crossroads, TV towers, nuclear power plant, concrete pipes, water conservancy and pre-stress concrete standard fittings, especially in the field of high-rise residential buildings with more demands. The market prospect is prosperous. Beigang Group now has advanced high-speed wire production line and steel-making facilities. Beigang relies on its condition on raw materials and aims to build production lines of high-strength low tensile pre-stress steel wire. Ⅰ.Content 1. Main products, output and specifications The project aims to adopt advanced process for building production lines of pre-stress steel wire and steel twist, which can annually produce 60 thousand tons of steel wire and steel twist wires.
Varieties specifications Annual output(tons)
PC steel wire Φ4.8mm andΦ5.0mm 10000
Φ6.0mm 12000
Φ7.0mm 5000
Other specifications 3000
PC steel twist wire Φ12.5mm 10000
Φ15.6mm 15000
Φ17.1mm 5000
2. Production process The process includes the raw materials preparations before drawing, intermediate and final heat treatment, steel wire drawing and steel wire coating. 3. Main equipment The main equipment includes mechanical deoxidizing, electrolytic pickling, boronising machine, 6/900 continuous drawing machine (DC shift), tensile strength tempering machine, inspection equipment etc. 4. The total investment is US$23.6 million, among which static investment is US$19.16 million, the loan interests US$ 0.83 million, the minimum fluid fund US$3.61 million. Upon reaching the full production capacity, it's estimated that annual sales income can reach US$41.22 million, average after-tax profit US$3.11 million and average income tax US$ 1.53 million. The internal rate of return for the full investment is 26%, investment recovery period 6.5 years. Therefore, the project has prosperous economic benefits. Ⅱ. Advantage 1. Chinese government put forward the strategic goals For revitalizing the old industrial base in northeastern China and provides a series of favorable policies for state-owned enterprises in the three provinces of northeastern China. Pre-stress steel twist wire belongs to new-type high-strength steel products for buildings and is one of the energy-saving materials widely spread by Chinese government. 2. The advanced high speed wire products and steel making facilities in Beigang Group can fully guarantee the supply of raw materials of pre-stress steel twist wires. 3. The water consumption for production is 321 tons per hour. The consumed water is recycled and reused, and 4% of new water is replenished; the total consumption of compressed air is 900m3/h with 0.4-0.7Mpa of air pressure; the electricity for production is 7470 KW (380V, three-phase four-line power supply). The project can rely on the existing auxiliary public facilities. 4. Beigang has tens of years of experience in iron & steel making, masters much technical know-how in aspect of iron & steel making and bring up a lot of staffs in production, management and technology. 5. The project aims to be built in Pingshan District Industrial Park of Benxi City, Liaoning Province, China, which enjoys convenient geographical location. The project occupies a land area of 10,000m2. Ⅲ. Mode of joint funding and cooperation
Beigang will input the existing land, public facilities, fund as the investment. The cooperation partner will input fund (technologies, equipment) as the investment and legally establish a joint venture. The detailed cooperation plan and investment amount can be determined through consultation after studying its feasibility by both parties. The cooperation partners participate in the business according to their respective investment proportion, enjoy the profit distribution and assume corresponding risks. They can also cooperate in the form of financing lease, compensation trade etc.

Joint Funding & Cooperation of Cold-bent Shape Steel Project

Cold-bent shape steel is a kind of shape steel with profiled-structure section, which is of the characteristics of light weight, high strength and energy saving, and widely used in industries, such as building, transportation, mechanical, household electric appliance etc. Cold-bent shape steel is not only of the characteristics of reasonable sectional structure, diversified varieties and specifications, accurate dimensions, but also embodies the unique requirements of the modern era on materials, i.e., light weight, rationalization and functionality. Meanwhile, it can be a save of time in construction. At present, it's a high-efficiency economical material highly spread by Chinese government. The development of cold-bent shape steel replaces traditional building materials. It is of the characteristics of erosion-resistance, light weight, high strength, energy saving, temperature keeping, sound isolation, easy to construction and etc. Additionally, it can also be designed and manufactured according to customers' unique requirements, and have strong competition edge. The development of cold-bent shape steel aims to utilize the strip steel produced by Beigang, realize products extension and increase the products' added value. Ⅰ.Content 1. Production scale and scope Upon completion of the project, it can produce 50 thousand tons of cold-bent shape steel. Product scope: square pipe 50*50*1.0-500*500*14, rectangular pipe 40*20*1.0-600*400*14, channel steel 50*30*3.0-500*300*14, angle steel 50*50*4.0-300*300*14, rippled plate, fence on expressway and other shape steel with special section. 2. Main equipment The project aims to utilize the existing domestic technologies and equipment, newly build a 1800*14 longitudinal shearing machinery, two roller bending profiling machinery. The auxiliary equipment are gantry crane, overhead crane, transformer, air compressor, water pump, electronic balance, etc. 3. Investment estimation and economic analysis The total investment is about US$6.63 million, among which equipment investment is US$3.84 million, investment in civil engineering about US$1.94 million, investment in installation US$0.11 million, other investment US$0.73 million. After reaching the full capacity, the total output value can amount to US$26.51 million, profit & tax US$4.46 million, annual net profit US$1.2 million. 4. Location and energy consumption The project occupies a land area of 20,000m2. The factory can be located in Benxi Economic Development Zone, Liaoning Province, China. The water consumption is about 2m3/h, compressed air consumption about 5m3/min and electricity consumption about 1000KWh. Ⅱ. Advantage 1. Chinese government put forward the strategic goals for revitalizing the old industrial base in northeastern China and provides a series of favorable policies for state-owned enterprises in the three provinces of northeastern China. 2. The development of cold-bent shape steel can realize products extension and increase the products' added value. 3. The main raw material is strip steel, which can be mainly supplied by Beigang. In response to the market change, the raw materials can also use the narrow strip steel produced by Fugang and Linggang as well as the hot-rolled coiling. Additionally, the project of 1780mm hot-rolled coiling to be invested by Beigang also secures the supply of raw materials. 4. Beigang has tens of years of experience in iron & steel making, master much technical know-how in aspect of iron & steel making, and bring up a lot of staff on production, management and technology. Ⅲ. Mode of joint funding and cooperation Beigang will input the existing land, public facilities, fund as the investment. The cooperation partner will input funds, technologies and equipment as the investment and legally establish a joint venture. The detailed cooperation plan and investment amount can be determined through consultation after studying its feasibility by both parties. The cooperation partners participate in the business according to their respective investment proportion, enjoy the profit distribution and assume corresponding risks. They can also cooperate in the form of financing lease, compensation trade etc.

Joint funding & cooperation of benzol refining projects

Benzol is an intermediate product, whose use is very limited, and can only be used as solvent. But refined coked benzene, coked methyl benzene and coked dimethyl benzene are important raw materials for organic chemical, medicine and pesticide industry. It has a broad market prospect in both foreign and domestic market. At present, the prices of refined benzene product increase steadily. The refined benzene has a huge market potential. With the full execution of strategy for revitalizing the old industrial base in northeastern China, in response to the market need, Beigang will newly build the benzol refining projects, which will enrich Beigang’s product varieties and improve economic efficiency.
1.Project content
(1) Production scale
The annual production of benzol is 40 thousand tons. Upon completion of the project, the annual production of pure benzene is 28.31 thousand tons, toluene 5282 tons, dimethyl benzene 1254 tons, solvent oil 2800 tons and remnant oil 1200 tons.
(2) Main process
The project uses pickling to purify benzol, which is a widely used process, and have strongpoint of mature process, reliable technology, simple process and low one-time investment.
(3) Project progress
The construction period is 1.5 years. It takes two years to reach designed capacity after the project is finished and put into production. The output reaches 90 percent in the first year and reaches 100 percent in the second year.
(4) Investment estimation and economic appraisal
The total investment of this project is RMB 42.56 million yuan, among which static investment is RMB 36.88 million yuan, loan interest in construction period RMB 1.35 million yuan and minimum fluid fund RMB 4.33 million yuan.
The total investment in environmental protection is RMB 1.85 million yuan, accounting for 5% of static investment.
After the project is put into production, the annual sales revenue can reach RMB 192.38 million yuan, profits RMB 22.94 million yuan, internal rate of return 29.41%. The recovery period for total investment( including construction period) is 5.28 years.
2. Project advantage
(1) Project advantage
Chinese government has put forward the strategic objective of revitalizing the old industrial base in northeastern China and offers a series of favorable policies for state-owned enterprises in Northeast China.
(2) At present, Beigang Coke Plant has 8 coke ovens with over 40 thousand tons of benzol annually. The resources of benzol are abundant, which guarantees the supply of raw materials.
(3) The project is intended to be built in Beigang’s new area and covers an area of 25000m2. The project site has complete railway and highway transportation systems. The electricity needed for the project comes from transformer substation in Beigang’s new area. Water, steam, compressed air and coke oven gas can be connected to Beigang’s existing pipe network. (4) The project product has bright market prospect, which guarantees efficiency. 3.Mode of joint funding & cooperation
Beigang will input land, public auxiliary facilities as its investment. Cooperation partner will input fund, equipment and etc. as their investment and legally establish a joint venture. The detailed cooperation plan and investment amount can be determined through consultation. The cooperation partners participate in management, enjoy profit distribution and assume corresponding risks according to their respective investment proportion. They can also cooperate in the form of financing, leasing, compensation trade and etc.

Joint Funding & Cooperation of Second-phase Project of Wooden & Plastic Door and Window

The integrated timber is a highly world-welcome product with high added value and is the ideal material for manufacturing wooden & window, solid wooden furniture and exterior decoration, which has prosperous market prospect. In the international market, the products are sold very well. Because of competitive price of integrated timber produced in China, the product has strong market competition edge in Japan, South Korea, Hong Kong, Taiwan and etc. and the demand increases steadily year by year. In China, with the emerging of high-grade wooden & plastic door and window, the demand on timber will increase year by year. In addition, the demand on integrated timber for producing furniture and decoration materials is also huge home and abroad. For the recent years, the industries of furniture and solid wooden window in China starts to use integrated timber on a large scale. It's now highly welcome by real estate developers and becomes one of the main commercial products in furniture market. Beigang Group intends to build a integrated timber production line of 30000m3 with strong market competition edge, which will become a new economic growth point for the enterprise. Ⅰ. Content 1. Production scale The project intends to build a integrated timber production line of 30000 m3, including grade A integrated timber for window frame with annual production of 20000m3, and grade A and B integrated materials for window frame with annual production of 10000m3. 2. Main equipment The core equipment adopt integrated timber production line from Germany. Drying kiln and other auxiliary equipment were purchased in China. 3. Investment estimation and economic analysis The total investment is about US$7.75 million, among which static investment is US$6.93 million, loan interest in construction period US$0.13 million, the minimum fluid fund US$0.7 million. It's estimated that the annual sales income is US$20.96 million, net profit US$3.93 million. The after-tax internal rate of return is 55% and investment recovery period 2.76 years (including construction 1 year). The project has excellent economic benefit with certain strong anti-risk capacity. 4. Auxiliary public facilities The electric installation capacity is 285KW (excluding log processing, board processing, absorption and air compressing equipment). The water consumption in supplying steam for drying kiln is 2 tons per hour. The heating temperature is 18-20℃ in storehouse of dried timber and glue coating process. Ⅱ. Advantage 1. Policy advantage The project is in conformity with state industrial policies and energy saving policies as well as the requirements on industrial structure in Benxi old industrial base. 2. Market advantage Integrated timber products have unique advantage in the huge building market with abundant resources of raw materials. Its high performance makes it the most preferred materials for high-grade solid wooden door & window, high-grade furniture and exterior decoration. In recent years, it's widely used in the industries of furniture and solid wooden door& window. 3. Advantage on raw material The main raw materials are timber. The northeastern China has abundant resources, which can guarantee supply. High-grade timber can be imported. The rest of the raw materials can be supplied by other provinces. 4. Advantage on location conditions The project intends to be built in eastern part of Benxi Economic Development Zone and covers a land area of 129000m2. The factory area neighbors 304 national highway, Shendan expressway, Shendan railway, therefore, transportation is very convenient. In addition, the infrastructure, including water supply, power supply, heat supply, telecommunication, road and etc., provides excellent external conditions for the project. Meanwhile, the project can also utilize the factory buildings of the first phase project of wood & plastic. Ⅲ.Mode of joint funding and cooperation Beigang will input the existing land, public facilities, fund as the investment. The cooperation partner will input funds, technologies and equipment as the investment and legally establish a joint venture. The detailed cooperation plan and investment amount can be determined through consultation after studying its feasibility by both parties. The cooperation partners participate in the business according to their respective investment proportion, enjoy the profit distribution and assume corresponding risks. They can also cooperate in the form of financing lease, compensation trade etc.

Joint funding & cooperation of big logistics project

With China’ entry into WTO, imports & exports volume grows quickly, which makes marine transportation un-precedentedly prosperous. According to prediction, for domestic and international marine market, the next few years are important period featuring increased demand and marine transportation volume. However, the growth of bulk transportation and container transportation lags behind. With policies for revitalizing the old industrial base in Northeastern China, in response to market demand, Dalian Dongzhan Group Co., Ltd. (hereinafter short for Dongzhan Company), sincerely invites foreign and domestic investors for cooperation and investment. In light of principle of reciprocity and mutual benefit, we jointly construct Dongzhan Company. The project aims to fully bring respective advantage into full play and bring benefits for cooperation partners.
1. Project content
(1) Basic content
Through integration of logistics resources, Dongzhan Company aims to build one of the largest comprehensive iron & steel logistics enterprises in China with independent automobile transportation, marine transportation, complete seaport storage chain, advanced processing & delivery system and excellent management team, integrating land transportation, storage, marine transportation, processing and sales. The logistics industrial chain that Dongzhan Company intends to construct includes four links:
①Land transportation
To establish independent automobile transportation team, to conduct land transportation business of Beigang to Baiyuquan seaport and Beigang to Dandong seaport. Meanwhile, to provide short-journey automobile transportation from the two seaports to the provincial and ambient regions so as to prolong the logistics industrial chain.
②Upstream seaport storage & delivery
to build upstream seaport layout with Baiyuquan seaport as the mainstay and Dandong seaport as the assistant; to construct logistics storage warehouse in Baiyuquan and Dandong seaports in order to provide storage, unload, delivery, third-party storage and forwarding business; to cooperate with Seaport authorities to construct wharf.
③Marine transportation
To establish a self-owned shipping team through purchasing, time charter and voyage charter; to monopolize transportation business of building materials from Baiyuquan to Shanghai as well as Baiyuquan to Guangzhou and etc. ; meanwhile, to develop voyage of Dandong-to-Shanghai, Ningbo, Qingdao, Yantai, Jiangyin and etc.
④Downstream seaport processing and delivery
To conduct processing and delivery business in such downstream seaport as Shanghai and Guangzhou, as well as such end sales market as Shandong and Tianjin; to prolong logistics industrial chain, to switch from the original single sales mode, i.e., directed towards middleman, to comprehensive service mode, i.e., directed towards end customers, middleman and processing businessman, integrating iron & steel products storage, deep processing, delivery and sales.
Through investment in the four logistics links, to prolong and perfect the whole logistics chain; meanwhile, to integrate resources, to realize reasonable running of materials and information flux, to improve efficiency and increase benefits.
(2) Investment estimation and economic appraisal
The total investment of the project is RMB 117 million yuan. It includes:
①Seaport storage
A. Liaoning Xingyuan Logistics Company
The total investment of Liaoning Xingyuan Logistics Company is RMB 50 million yuan, annual storage capacity 1.7 million tons. According to profit calculation of 4.5 yuan/ton, it’s predicted that the annual net profit will reach 5.1 million yuan, and internal rate of return is 15.3%.
B. Dandong seaport project
The total investment of Dandong seaport project is RMB 30 million yuan, annual storage capacity 1.7 million tons. According to profit calculation of 3 yuan/ton, it’s predicted that the annual net profit will reach 5.1 million yuan, and internal rate of return is 17%.
②Ocean shipping
The total investment for purchasing 15000-ton ships is RMB 35 million yuan. Dongzhan Group guarantees the shipping capacity. It’s predicted that the annual net profit will reach 3 million yuan, and internal rate of return is 8.57%.
③Processing & delivery
Dongzhan Company and Shanghai Seaport jointly invest RMB 2 million yuan to found Shanghai Jinyuan Metallic Material Co., Ltd in order to conduct steel processing business. The annual processing capacity is about 0.2 million tons, annual net profit 0.4 million yuan and internal rate of return 20%.
2. Project advantage
(1) Policy advantage
The policies for revitalizing strategy in Northeastern China provide taxation preferential policies in the field of equipment manufacture, metallurgy, shipbuilding and etc. For fixed assets investment, it also provides policy support of reducing depreciation period. Meanwhile, the Central Government definitely proposes to construct Dalian into an international shipping center in Northeastern Asia. Liaoning province and Dalian city also issue Decision on Speeding Construction of Dalian International Shipping Center by Liaoning Province and Suggestions on Construction of International Shipping Center in Northeastern Asia, and enact relevant policies in order to encourage investment for construction of seaports in Dalian and ambient regions and vigorously develop shipping logistics.
(2) Resources advantage
①Hardware advantage
Dongzhan Company and Yingkou Seaport Authority jointly invest to found Liaoning Xingyuan Logistics Co., Ltd., and have 100 thousand m2 of storage land in seaport area. Dongzhan Company and Shanghai Seaport Authority jointly found Shanghai Jinyuan Metallic Material Co., Ltd to conduct processing business of steel sheet and strip steel. Meanwhile, Dongzhan Company now has 4 ships of 15 thousand tons for time charter.
②Advantage on supply of goods
Dongzhan Company has stable supply of goods, which provides guarantee for development of big logistics project.
(3) Market advantage
With China’ entry into WTO, imports & exports volume grow quickly, which makes marine transportation un-precedentedly prosperous. The latest statistics show that in the first season of 2004, the imports and exports throughput in China’s main seaports exceeds 0.2 billion tons, a 114% rise than that in the corresponding period last year. According to prediction, for domestic and international marine market, the next few years are important period featuring increased demand and marine transportation volume. However, the growth of bulk transportation and container transportation lags behind.
(4) Rich experience in logistics business and personnel advantage
Dongzhan Company accumulated rich experience in land transportation, storage & sourcing, marine transportation and etc. Dongzhan Company boasts advanced management team and stable customer source as well as perfect market network.
3. Mode of joint funding & cooperation
(1) Equity cooperation
Both partners input cash or land, transportation vehicle, processing equipment and other fixed assets as investment to jointly found joint ventures. They can jointly assume risks and share profits in proportion to their investment. Cooperation partners and Dongzhan Company can jointly establish a unified logistics company in charge of the whole logistics project. They also can establish joint ventures for single or several projects. The project of single investment includes:
①investment in upstream seaport
To invest in upstream Baiyuquan, Dandong and other seaports; to purchase land for storage conducting storage, forwarding and sales business.
②Marine transportation project
To establish shipping company, purchase ships and conduct marine transportation business, which effectively link upstream seaports and downstream steel market.
③Storage and processing project in end market
To establish joint venture, invest in steel storage and processing project in downstream main steel consumption regions, to purchase or rent processing equipment, land, factory building and other resources, to conduct storage & processing business in combination with the actual conditions of local deep processing market.
(2)Business cooperation
Cooperation partners and Dongzhan Company can sign cooperation agreement for business cooperation, defining respective rights and liabilities. Both parties can conduct business and realize win-win through resources complementation.