Shanxi 2010 coal output to grow

15:29, March 08, 2010      

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China's Shanxi Province, the country's top coal producer, expects its coal output to rise by up to 30 percent in 2010, the province's Party boss said Saturday.

"The coal orders we have received have exceeded 700 million tons. We expect to produce 700 million to 800 million tons," said Zhang Baoshun, the Party secretary of the province.

The figure is higher than an earlier estimate of 600700 million tons. Shanxi produced 615 million tons of coal in 2009, about 20 percent of China's total, the Xinhua News Agency said earlier.

This year China is targeting national coal output of 3.15 billion tons, a 3.3 percent increase, the country's economic planning ministry, the National Development and Reform Commission, said in its annual economic plan Friday.

That growth rate is slower than most analysts' demand forecasts and the NDRC's expectation that electricity output, most of which is coalpowered, will rise 6.6 percent this year.

Shanxi launched a consolidation push in the coal industry last year during the economic slowdown, causing its annual coal output to fall about 5 percent.

The Shanxi consolidation drive, which aimed to close small, dangerous and inefficient mines, was a major factor in turning China into a net importer of coal last year, with a tripling of import volumes, mostly from Australia, Indonesia and Vietnam.

China is heavily dependent on coal for power generation, but the government wants to cut back on the dirty fuel, with hydropower, wind, nuclear and gas playing larger roles. Those energy sources, costlier than coal, could make quicker strides if consolidation pushes up coal prices by cutting supply or raising safety standards and production costs.

The head of one of China's top five power firms, China Power Investment Corp, said Friday he wanted a hike in electricity prices to reflect the rising cost of coal.

Source: Global Times
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