New reform moves for coal sector

China will stop companies from developing new coal mines with a capacity under 300,000 tons a year, and offer financial support for coal firms that seek to exploit shale gas.

The National Energy Administration released new reform measures yesterday to upgrade China's coal industry as part of efforts to sharply reduce damage to the environment.

Coal mines under a capacity of 90,000 tons a year will be gradually closed across the country and the government will encourage the relatively developed regions to give up coal mines that produce under 300,000 tons a year.

The country will in principle curb the exploitation of new coal mines in eastern provinces such as Shandong and Hebei while new projects in the western region will mainly serve power stations and chemical factories.

Companies seeking to tap shale gas will get state financial help such as tax reduction and capital injection, according to the NEA.

The NEA said it would take a tougher stand on illegal overproduction and has demanded coal factories raise the safety standards in mining.