Question-and-Answer Session
Operator
Thank you. (Operator Instructions) Our first question today will come from the line of Ben Kalow. Please go ahead.
Unidentified Analyst
Hi, guys.
Tim Vail
Hi, Ben.
Unidentified Analyst
Could you guys give us some perspective on the size of YIMA and how financing that how them backing up the project debt diverse?
Tim Vail
YIMA, is one of the larger coal companies in the Henan Province of China in fact the second largest in that region. They've been around four almost a 100 years, substantial operations throughout that area. Just a large well-capitalized, state-owned operation. They do not release a lot of financial data, although we have a high level of confidence in their ability to be able to finance our project.
Dave Eichinger
Yeah. And Ben project size there was 500,000 tons of methanol in the first phase, anticipated CapEx loss of $350 million. We anticipate the debt package for that project to be between 50% and 60% debt, and as previously disclosed we would be 50-50 partners actually 49-51% partner in that where we own 49% of the project. They would guarantee 100% of the debt for the project.
Unidentified Analyst
And we look at some of like the debt that were used for Hai Hua?
Dave Eichinger
Exactly.
Unidentified Analyst
Okay.
Dave Eichinger
And so that, you know, currently it's kind of a statutory bank rate from the four large Chinese banks there. I think the first year of our loan in Hai Hua was 7.83% and it's 7.11%. Currently it resets on annual basis. I think those of you've been following press regarding Chinese bank activities, they're actually getting more aggressive in an effort to keep China growth going through the global down turn, and I think that in general bodes extremely well for our ability to advance projects there.
Unidentified Analyst
Okay. And then as far as Hai Hua is concerned, this $1.4 million that we had in the cost of sales is that a run rate that we should look at going forward or do you guys see that dropping?
Dave Eichinger
Yeah, really it's a partly a function of how much gas Hai Hua wants through the plant, because you know the totaling arrangement. So we nominate a capacity and then they tell us how much , how much syngas to make. But we do think that there are going to options at least to lower that number as both we operate the plant more efficiently and more aggressively source lower cost coals.
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