Under the first agreement, Shenhua and Shell signed a deal to carry out a joint study into the building of a facility at the Ningdong coal production base.
The study into the plant, which is expected to cost between $5 billion and $6 billion, will be completed by 2009, reported the Xinhua news agency.
The plant will use Shell’s indirect coal liquefaction technology, which turns coal to gas before liquefying it into fuels and could produce 70,000 barrels of oil per day by 2012.
Meanwhile,