In a bid to better equip large-scale coal mines to improve safety and ensure continuity of fuel supplies a national energy program has been unveiled.

The National Development and Reform Commission said 13 designated national production bases are being planned for coal rich autonomous regions and provinces such as Shanxi, Shaanxi and Inner Mongolia.

The production capacities of the areas, which have about 500 mines, are expected to reach 1.3 billion tons in the future. This is nearly 60 percent of China's total production last year.

"The government aims to ensure some of the bases each produce at least 100 million tons every year to safeguard China's energy supply," said the commission's spokesman when announcing the program.

The bases include the Shenfu-Dongsheng coal zone which is located along the boundary between Shaanxi Province and the Inner Mongolia Autonomous Region in north China. It became China's first 100-million-ton coal production base last year.

Huang Shengchu, president of the China Coal Information Institute, told China Daily yesterday that the country faces demanding challenges in streamlining its coal industry and closing down small and potentially dangerous mines. "The measures for setting up large-scale bases will help relieve the pressure," said Huang.

He said the program aimed to improve the technical standards of the mines and their efficiency in utilizing resources.

Foreign investors, he suggested, especially multinationals, should be allowed to enter the coal mining industry to help improve mining safety in the country.

"At least one or two bases out of the national resource should be open to overseas investors," he added.

He observed that foreign mining companies were well qualified in safety management and this would help reduce the number of accidents. "We can also gather some experience in co-operatively mining coal with other resource-rich countries," added Huang.

Zhao Tiechui, vice-administrator of the State Administration of Work Safety, recently warned of excessive coal production in China.

China would be able to produce 2.75 billion tons of coal annually after the new facilities are  operational in the next few years. In 2005 approximately 2.15 billion tons of coal was mined which met the country's demands.

Previous forecasts by a team in the administration predicted China's coal demand would be between 2.5-2.6 billion tons in 2010 due to the country's massive energy-saving campaign.

Coal accounted for 76 percent of China's energy use in 2005. According to the team that level is likely to rise to 80 percent after 2010.

"The current supply-demand situation has left us enough room to shut down poorly-equipped small coal mines," said Zhao.

In the middle of 2005 China had 24,000 small coal mines with annual production capacities ranging from 10,000-30,000 tons. They account for 70 percent of the total number of coal mines in the country.

As part of the safety campaign China plans to shut down 12,900 small pits before 2007. 

(China Daily May 8, 2006)