Hong Kong listed company conference questioned by Greenpeace demanding the end of water grabs

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Press release - 2013-08-26
Hong Kong - Today, the Shenhua Group (HKG 1088) 2013 Interim Results Conference was questioned by activists from Greenpeace, an international environmental NGO, who submitted to company board members an open letter and report titled Thirsty Coal — An Investigation into the Over-Extraction of Groundwater and Illegal Discharge of Wastewater by Shenhua Group's Ordos Coal-to-Liquid Demonstration Project (herein after referred to as the Shenhua Report), and demanded Shenhua Group respond to the accusation that its Coal-to-Liquid (CTL) Project in Erdos has devastated the local ecological environment.

At the press conference of the Shenhua Group posting their first half of 2013 results, activists from Greenpeace questioned company representatives, highlighting the withdrawal of a large amount of underground water in Ordos by Shenhua’s CTL project. Such excessive withdrawals have led to severe ecological degradation in the Haolebaoji, thus depriving thousands of local farmers and herdsmen of their livelihoods. Greenpeace activists in the meeting demanded Shenhua Group instantly stop the devastation of Haolebaoji, Erdos. 

“As the largest coal mining enterprise in the world, Shenhua Group has always praised itself as an ‘environmentally-friendly enterprise’. However, the results of our 11 field research trips completely contrast claims made by Shenhua that they ‘have shouldered due social responsibilities’,” says Li Yan, Climate and Energy Campaign Manager of Greenpeace. “This CTL project poses great risks to water resources. The project has devastated the ecological environment in Erdos, yet Shenhua still have plans for further expansion. As a listed company, it is highly inadvisable Shenhua continue ignoring resources and environmental risks.”

On July 23, the Shenhua Report was released by Greenpeace, and attracted the attention of the government, domestic and foreign media, and the public. It was reported the Ministry of Environmental Protection embarked on an investigation in response. After the Report was released, Shenhua Group submitted a statement 'An Explanation of Water Resource Exploitation and its Ecological Impact', as well 'An Explanation of Wastewater Discharge'.

In these two statements, Shenhua Group admitted for the first time that illegal emission and underground water withdrawal has impacted local vegetation. However, it still failed to provide a convincing explanation and clarification on many key problems relating to water withdrawal, such as falling underground water levels, the shrinking of surface water, grassland desertification, and the hardship placed on farmers and herdsmen.

Additionally, an expansion of Shenhua Group’s phase one CTL project has already been initiated, with estimates placing the projected water withdrawal amount at three times that of the present. In the Statement to Greenpeace, Shenhua claimed that it was carrying out a retrospective environmental assessment on the first production line, and that the results of this is to be released this year.

“While we appreciate the cooperative attitude of Shenhua Group, their response fails to address the heart of the problem, and does not appreciate the severity of the ecological crisis that has hit this area. Shenhua is still pumping out water in the farming and pastoral area of Haolebaoji, where underground water resources are already scarce,” emphasizes Li Yan.

“The ecological environment there is extremely fragile. Therefore Shenhua should immediately halt this destruction of the local environment, and take precautions to prevent further damage.”

At the conference Greenpeace activists reiterated its demands made during the initial report release: Shenhua Group should stop the ongoing damage of farming and pastoral areas in Haolebaoji; and as soon as possible publish the results of the re-evaluation environmental impact report of CTL projects in Ordos examining water resources and the environment. Finally, it should reconsider its expansion plans and make “water-based coal production” a core principle. 

Li Yan adds, “Water-based coal production should be the fundamental principle of the coal industry working in areas with water shortages. However, this principle has not been complied with. The CTL project in Ordos is instead stealing the water of local residents and the grasslands. And this has resulted in a crisis that threatens both the ecology and human livelihoods. It should stand as a warning sign for the entire coal industry.”

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Media Contact:

Li Yan, Climate and Energy Campaign manager, Greenpeace
 +86 13911251485

Yu Chong, Media Officer (Beijing), Greenpeace
 +86 13810784274

Sandy Zeng, Communications Officer (Hong Kong), Greenpeace
 +852 91331415

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