Plans to develop two of the 15 large coal-bed methane capture
projects, proposed during the Second US-China Strategic Economic
Dialogue, are on the drawing board, according to China United
Coal-bed Methane Corporation (CUCMC).
Product sharing contracts had been signed on all 15 projects in
the two weeks since the dialogue and the first two were ready for
development subject to approval from China's economic planning
agency, the National Development and Reform Commission (NDRC), said
Zhang Guoliang, director of the department of international
cooperation of CUCMC.
The CUCMC is the only company in China authorized by the
government to cooperate with foreign partners in coal-bed methane
mining and development.
Eleven projects are located in north China's Shanxi Province,
with the other four in Anhui, Shaanxi, Jiangxi and Yunnan
provinces.
Chevron has invested in four projects, Greka Energy in five, Far
East Energy in three, and MidAmerican Energy Holdings, ORION Energy
International and Asian American Gas Inc. in one each.
Under the contracts, foreign investors will fund exploration.
After the projects go into production and the exploration funding
is repaid, the Chinese and foreign investors will share the
proceeds according to their investments.
Coal-bed gas is a natural product during the conversion of plant
material to coal. Utilization of the clean fuel could contribute to
the reduction of greenhouse gas emissions and help relieve China's
energy shortages.
The cooperation was mutually beneficial to China and the United
States, said Zhou Dadi, an energy expert with the NDRC.
The United States, with mature coal-bed gas development
technology, would profit from the cooperation, while China, under
increasing pressure from industrialized economies to reduce its
greenhouse gas emissions and rising energy demand, could improve
its energy supply structure, he said.
Under the National Climate Change Program, issued by the
government on Monday to address climate change, China aims to
reduce emissions of carbon dioxide by 200 million tons by
developing coal-bed methane by 2010.
The government's plan for coal-bed gas exploitation and
utilization for 2006-2010 shows China should increase its proven
reserves of coal-bed gas by 300 billion cubic meters and have an
annual output of 10 billion cubic meters by 2010.
China has issued preferential tax and financial policies to
boost the development of the coal-bed gas industry.
Zhang said US companies had invested more than US$200 million in
the preliminary prospecting phase.
(Xinhua News Agency June 7, 2007)
