Ping An Bank commits first loan for carbon capture project in China

The project is valued at RMB180m ($24.8m).

Ping An Bank provided the initial loan instalment to Baotou Iron and Steel Group Co. for a carbon capture project. 

This project, valued at RMB180m ($24.8m), marks the first of its kind to cover the entire steel industry chain in China.

The carbon capture, utilization, and storage (CCUS) demonstration project, with a total capacity of 2 million tonnes, aims to significantly reduce carbon dioxide (CO2) emissions for Baotou Iron and Steel Group. 

It is projected to achieve an annual CO2 reduction of 365,300 tonnes, equivalent to the impact of planting nearly 19 million trees. 

Construction for the first phase, which involves 500,000 tonnes, began in June 2022.

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Ping An Bank provided an initial loan instalment of RMB13m ($1.8m), with subsequent loans to be disbursed in batches based on project progress as stipulated in the loan agreement.

CCUS technology is instrumental in achieving carbon neutrality as it effectively captures CO2 emissions from industrial sources and either utilises the captured CO2 or stores it in geological formations. 

This technology has immense potential for significant emission reduction in industries such as oil and gas, coal-fired electricity, and coal chemicals.

Alongside the CCUS project of Baotou Iron and Steel Group, Ping An Bank has also extended loans amounting to RMB1.6b ($220m) to Liuzhou Iron and Steel Group as of June 2023.

These loans are specifically allocated for waste steel recycling, utilisation of waste heat generated during ironmaking processes, and technological transformation and upgrading.

The aim is to facilitate the transition of traditional carbon-intensive industries and contribute to reducing carbon emissions.

(RMB1.00 = $ 0.14)