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Fast recovery after earthquake -- Manufacturing resumes

Dongfang Turbine Company, the wind turbine division of Dongfang Electric, still expects to meet its target to produce 600-800 machines this year, says the company's Zhang Shying. Located relatively close to the epicentre of an earthquake that struck China's Sichuan province on May 12, killing around 70,000 people, Dongfang was one of the worst affected state-owned enterprises, with many of its operations suffering extensive mechanical and structural damage and loss of life. The company's wind turbine production facilities, however, were relatively unscathed, it says.

Dongfang Electric Machinery, a subsidiary that produces generators for its wind turbines, sustained no damage at all, says a spokeswoman for the division, which lies 300 kilometres south of the epicentre at Wenchuan. "The devastating earthquake resulted in some difficulties in purchasing materials at first, but we managed to complete production in a timely manner," she says.

By May 20 the division had resumed its shipment of generators to Dongfang Turbine, the listed company in the Dongfang empire that that produces both steam and wind turbine generators. Located in Deyang City, just 90 kilometres from the epicentre, it was hard hit, but most of the damage centred on its steam turbine production facilities. The wind turbine factory -- where Dongfang Turbine manufactures rotor blades and assembles its 1 MW and 1.5 MW units -- suffered minimal damage and resumed operation on May 17, with its first post-quake turbine coming off the production line three days later. Between May 20 and May 30 it took delivery of 22 generators from its sister company.

Last year, Dongfang Turbine won wind contracts worth around CNY 10 billion ($1.45 billion), says Zhang, who denies reports that the earthquake has caused losses amounting to CNY 7-8 billion ($1-1.6 billion) for the division. "We are still counting the economic toll," he says. "Aftershocks have prevented us from making an overall and accurate assessment."

Dongfang does not expect the group's total loss to surpass CNY 5 billion ($723.59 million). "With huge support from other companies and the government, we plan to restore eighty per cent of our production capacity in six months and build a brand new Dongfang Turbine in two years," says Zhang.

Since the earthquake, the government has provided reconstruction funding and a number of Chinese companies have announced power equipment supply contracts, covering various generation technologies including wind power, with Dongfang's orders worth more than CNY 10 billion ($1.45 billion). The first wind deal announced post quake, worth CNY 1.24 billion ($180.03 million), is for 134, 1.5 MW units to be supplied to China Energy Conservation Investment Corporation (CECIC).

CECIC's Xing Zhongqin confirms the deal, but will not say when the units are slated for delivery or where they will be installed. The company operates a combined 300 MW of wind plant in Xinjiang, Gansu, Inner Mongolia, Hebei, Fujian and Jilin.

Dongfang is also supplying China Huaneng Group with 50, 1.5 MW wind turbines, worth around CNY 500 million ($72.5 million) as part of a larger CNY 4.5 billion ($651.23 million) order for power equipment signed on May 25. Huaneng's wind projects, totalling 410 MW by the end of 2007, are mainly located in Hainan, Guangdong and Inner Mongolia.

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