Zhao also noted a great opportunity for the development of green hydrogen.

The price of polycrystalline silicon, a major material in the production of solar panels, surged last year. However, this year the price has fallen sharply. "I expect that the hydrogen industry will embrace a good development period," he said.

In another move to decarbonize its coal-to-chemical operations, the base commenced the construction of a carbon capture, utilization and storage project, or CCUS, in May.

"Once it goes into operation, the project will have the ability to reduce carbon dioxide emissions by 3 million tons a year, which is equivalent to planting 27 million trees," said Wang Xiaohan, an official with the management committee at the base.

That reduction roughly equals the amount of carbon dioxide emissions that would be prevented by banning the use of all civilian cars in Ningxia for two years, he added.

The CCUS project will capture carbon dioxide emissions from a coal liquefaction plant in Ningdong. The greenhouse gases will then be transported to the Changqing oilfield in Ningxia, and after they have been used to recover the oil, the gases will be stored underground. The project will be constructed in three phases, with a total planned investment of more than 100 billion yuan ($137 million), according to the management committee.

The first phase of the project will go into operation next year, with the second phase opening in 2025. The base will start building the third phase during the period of the 15th Five-Year Plan (2026-30).

After the project becomes fully operational, 74.5 million tons of carbon dioxide is expected to be injected underground for storage during the operating period of 30 years, which may help raise oil output by more than 17 million tons.

"It will not only become the country's largest full-chain CCUS project, but also provide low-carbon development experiences that will be applicable to coal-to-chemical industries across the country," said Ma Cheng, a senior official with the Ningdong management committee.