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Property and Equipment and Construction in Progress
 6 Months Ended
Jun. 30, 2019
Receivables, Long-term Contracts or Programs [Abstract]  
PROPERTY AND EQUIPMENT AND CONSTRUCTION IN PROGRESS

8. PROPERTY AND EQUIPMENT AND CONSTRUCTION IN PROGRESS

 

Property and Equipment

 

As of June 30, 2019 and December 31, 2018, the Company had net property and equipment (after impairment provision recorded in 2018) of approximately $27.45 million, which was for the Chengli project.

 

The Chengli project finished construction, and was transferred to the Company's fixed assets at a cost of $35.24 million (without impairment provision) and ready to be put into operation as of December 31, 2018; the owner of the Chengli Project changed from Chengli to Shandong Boxing Shengli Technology Company Ltd. ("Shengli") in March 2014. On January 22, 2019, Xi'an Zhonghong completed the transfer of Chengli CDQ WHPG project as the partial repayment for the loan of RMB 188,639,400 ($27.54 million) to HYREF (see Note 12). However, because the loan was not deemed repaid (See Note 12 for explanation), the Company kept the Chengli project in its books as fixed assets for accounting purposes as of June 30, 2019.

 

Construction in Progress

 

Construction in progress was for constructing power generation systems. As of June 30, 2019 and December 31, 2018, the Company's construction in progress included:

 

   2019   2018 
Xuzhou Huayu  $-   $23,778,899 
Xuzhou Tian'an   38,316,766    38,380,969 
Less: assets impairment allowance   (13,261,127)   (19,577,691)
Total  $25,055,639   $42,582,177 

 

As of December 31, 2018, the Company was committed to pay an additional $11.66 million for the Xuzhou Huayu project; however, on February 15, 2019, Zhonghong transferred the Xuzhou Huayu Project to Mr. Bai for RMB 120,000,000 ($17.52 million). Mr. Bai agreed that as consideration for the transfer of the Xuzhou Huayu Project to him (Note 12), he would transfer all the equity shares of his wholly owned company, Xi'an Hanneng, to HYREF as repayment for the loan made by Xi'an Zhonghong to HYREF.

 

As of June 30, 2019, the Company was committed to pay an additional $4.04 million for the Xuzhou Tian'an project.