China Shenhua Energy Company, the nation's top coal producer, said Tuesday that China has begun to implement plans to create its first national strategic coal reserve, the Jinghua Times reported.

A series of brutal snow storms in 2008 severely affected the production and transport of coal for generating electricity, and as a result, many provinces had power supply problems. Plans to create the new reserve are part of an effort to avoid similar problems.

Zhang Xiwu, Shenhua's chairman, said that Shenhua is now selecting sites and the total planned reserve will be around 30 million tons.

A coal market analyst with the China Coal Trade and Development Association, Li Chaolin, said, a reserve of 20 to 30 million tons is still big enough to stabilize the market when it faces a short term shortage of coal, even though the country's national demand is much, much larger than that.

(chinadaily.com.cn September 2, 2009)