YINCHUAN -- The world's biggest single coal-to-liquid (CTL) project went into production Wednesday in Northwest China's Ningxia Hui autonomous region.

The project, undertaken by a subsidiary of the state-owned Shenhua Group, consists of homegrown technology, equipment and materials, breaking the longtime foreign monopoly in CTL core technology.

China has rich coal resources but lacks oil and gas. Currently more than 60 percent of its oil is imported.

The project drew an investment of about 55 billion yuan ($7.9 billion). It is able to turn more than 20 million tonnes of coal to 4 million tonnes of oil products annually, including 2.7 million tonnes of diesel, 980,000 tonnes of naphtha petroleum and 340,000 tonnes of liquefied gas, according to Yao Min, deputy general manager of Shenhua Ningxia Coal Industry Group Co Ltd.

Byproducts include 200,000 tonnes of sulfur, 75,000 tonnes of mixed alcohol and 145,000 tonnes of ammonium sulphate, Yao said.

"If the oil products are promoted in first-tier cities like Beijing and Shanghai, they will help reduce car emissions and tackle the problem of smog," Yao added.