Synthesis Energy Systems To Turn Chinese Coal Into Natural Gas

Online, April 14, 2011 (Newswire.com) - Synthesis Energy Systems (SYMX, NASDAQ), a small Houston, U.S. company holds an important license for transforming technology that can turn cheap coal into natural gas. The technology comes at a crucial time with the future of energy uncertain. The recent explosions in Fukushima, Japan have undermined worldwide confidence in nuclear power with Germany halting production at seven power plants and the Swiss suspending plans for any new nuclear power stations. When you also consider the Libyan oil crisis and rocketing oil prices (crude oil is now over $100 per barrel), this technology couldn't have come at a better time.

China is so impressed by this technology that Synthesis Energy Systems is to see an investment of $83.5m by China Energy in return for a 43.5% stake in the company at $2.25 per share. China Energy's share will be increased to 60% over eight years gaining them ultimate control over the company. This innovative deal, allowing Chinese investors to control technology developed in the U.S. is to be used as a template for future energy investment.

Radioactive particles have been detected in China following the Fukushima explosions, which might have something to do with China's investment in alternative energy sources to nuclear power. Synthesis Energy Systems already has a plant producing methanol in China, with additional methanol and Glycol production intended at another facility. Methanol is used as a blending agent in gasoline; consequently its production is extremely important during a worldwide energy crisis.

China Energy's investment in Synthesis Energy Systems will utilise coal supplies from China and Mongolia, allowing for the more economically friendly and viable source of energy found in natural gas. The technology is particularly effective due to its ability to convert particularly low grade coals such as lignite into a more environmentally friendly form of energy.

Synthesis Energy Systems holds a ten year license for the technology along with an exclusivity deal that can be renewed. Robert Rigdon, CEO, has stated that they specialise in providing 'products and solutions to the energy and chemicals industries' and intend to continue to 'unlock the potential in challenging, low quality coals in an environmentally friendly manner.' Synthesis Energy Systems will increase their board from seven to eleven directors following this major investment from China Energy.