China GengSheng Minerals Inc. (CHGS) to Build New Fracture Proppant Manufacturing Facility

By @ibtimes on

China GengSheng Minerals Inc. develops, manufactures and markets a broad range of high-tech industrial material products. These products include monolithic refractories, industrial ceramics and fracture proppants. The company currently has over 200 customers in the iron, steel, oil, glass, cement, aluminum and chemical industries in China and other countries.

The company today announced plans to construct a new fracture proppant manufacturing facility in Gongyi, Henan Province. China GengSheng’s new plant will increase its annual proppant manufacturing capacity by 60,000 metric tons to 150,000 tons. This includes 30,000 tons produced by third parties under OEM agreements.

Construction of this new facility began earlier in the second quarter, with production expected to start during the second half of the year. This new facility will include two production lines capable of manufacturing proppant materials to customer specifications. Total cost of the plant is expected to be $8.6 million, which will be fully funded through operating cash flow and the proceeds of its recent registered direct offering.

China GengSheng expects continued strong growth from its fracture proppants business and believes that now is the time to expand its business. Much of this thinking is due to the start in earnest of the unconventional gas business in China and elsewhere, using technology imported from US companies. The company’s CEO and chairman, Shunqing Zhang, said, “New technological developments and a global surge in oil and gas drilling is driving a sharp increase in demand for high-quality, cost-effective proppant materials such as ours.”

For more information on China GengSheng Minerals, please visit its website at www.genesheng.com

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