Does CNOOC's Repeated Launch of Coal Chemical Count as "Brain Head"?

In the increasingly prominent Chinese coal chemical industry with overcapacity, CNOOC Group once again fell. The signing ceremony for the contract for the construction of the 3052 fertilizer project with investment of over 3 billion yuan by CNOOC Huahe Company was held in Beijing. The project uses coal as raw material, uses GE's coal-water slurry gasification technology and low-pressure synthesis process carbonic anhydride gas extraction technology, and has an annual production capacity of 300,000 tons of synthetic ammonia and 520,000 tons of large-granule urea. (July 16 "First Financial Daily")

CNOOC's project is contrary to the country's industrial policy. In other words, it is a repeated construction project. It is not time for this project of CNOOC. Because the industry's production capacity has long been in a serious surplus.

In March 2011, the National Development and Reform Commission issued the “Circular on Regulating the Orderly Development of the Coal Chemical Industry”, requiring all localities to further strengthen the examination and approval management of coal chemical projects, without delegating examination and approval authority, slicing into zero, and non-compliance approval. The notice also pointed out that some companies take the advantage of coal resources in the name of developing coal chemical industry. The blind arrangement of the project results in a lot of redundant construction.

In recent years, with the economic slowdown at home and abroad, the drawbacks of overcapacity in coal chemical industry have been exposed more fully. According to the data, 18 new synthetic ammonia and urea projects will be put into operation in China in 2012, with a total production capacity of 5.64 million tons of synthetic ammonia and 8.73 million tons of urea.

Now many state-owned enterprises are pursuing the national energy strategy in the name of the banner, so that coal chemical projects in China everywhere. But behind this, huge potential risks and environmental costs have been ignored. Take CNOOC's coal chemical project as an example. The project takes the “coal-synthetic ammonia-urea” route, and similar projects are already the worst-hit areas in the coal chemical industry. Domestic urea production has a low operating rate and parallel capacity expansion.

In fact, driven by profits, some state-owned enterprises have lost their way and have embarked on the same road. The inability of enterprises to invest in self-restraint has made many industries seem to reproduce the classic old ways of Chinese traditional industries: First, interest is driven up, followed by disorderly and chaotic industry. Finally, each company tastes vicious competition in the market.

The arbitrariness of state-owned enterprises' investment decisions is too great, and the waste of funds is staggering. The most important waste is the waste of repetitive investments. In contrast, the decision-making error rate of large and medium-sized Japanese companies is about 0.28%. The average decision-making error rate of large and medium-sized companies in developed countries is about 3% on average. However, the failure rate of decision-making in Chinese state-owned enterprises is relatively high. many.

It was the imperfections in the decision-making process that led a small number of leaders of state-owned enterprises to frequently make “brain head” decision-making projects in the planning of investment projects, and these projects were all based on non-scientific decision-making, often with The huge consumption of resources and huge waste of funds.

A scientific and rational engineering project should be investigated and analyzed to predict the development prospects, and there is sufficient evidence to meet the needs of production development. However, the frequent occurrence of “braking head” project in state-owned enterprises is due to the lack of laws and regulations, and it is very easy for a few leaders of state-owned enterprises to make decisions based on their own subjective decisions.

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