US$10bn project to turn coal into diesel

China, with 12% of the world's known coal reserves, unveiled plans to spend as much as $10 billion on a project to turn coal into diesel fuel. The 10-year project, which requires an extensive feasibility study first, was announced after coal giants Shenhua Group Corp and Ningxia Coal Industry Co. signed contracts with Royal Dutch/Shell and Sasol Ltd to get to work on a preliminary study. The latest project would cost RMB60bn (US$7.2 billion), a Shenhua spokesman told Bloomberg. That amount comes on top of RMB24.5bn already committed to building a coal-to-liquid plant in Inner Mongolia.