(Yicai Global) March 26 -- Meijin Energy, a Chinese cokemaker transitioning into a new energy company, plans to build a CNY10 billion (USD1.5 billion) industrial park for hydrogen-fueled vehicles in Zhejiang.

The Shanxi province-based firm and the Jiaxing Xiuzhou High-tech Industrial Development Zone Management Committee penned a framework agreement for the project over the weekend, Meijin said in a statement yesterday. The park will be based in the city of Jiaxing, about 100 kilometers from the center of Shanghai, and benefit from government incentives such as land, equipment subsidies and tax breaks granted by the committee.

Meijin has more coal resources than any other company in China, and the coking process generates hydrogen-rich gas as a by-product. Meijin and its competitors in coal-rich Shanxi have a combined annual coking capacity that could produce enough hydrogen to fuel 10,000 fuel cell trucks, the company once said.

It began shifting toward the hydrogen energy sector several years ago and now has control of Foshan-based Feichi Automobile Manufacturing, South China's leading producer of hydrogen-fueled buses. The firm also teamed up with an energy investment company in Guangdong province last year to form a venture capital arm focused on the hydrogen sector.

The new industrial park will span 1.3 square kilometers and Meijin hopes to lure in leading hydrogen energy firms of various types to settle there. Companies building hydrogen cars, charging stations and storage equipment are all targets.

Meijin will set up an independent local firm to run the project and partner local governments to set up an industry fund for the hydrogen energy sector, which would invest in major industrial chain projects, the statement said. It did not disclose further details.

Editor: James Boynton