China to speed up restarts at small coal mines

SHANGHAI, May 27 (Reuters) - China plans to speed up the approval process for resumption of production at small coal mines to help ensure thermal coal supplies in the summer, the National Development and Reform Commission said.

The nation's top economic planning body gave no specifics on changes to the approval process or which mines would be targeted, but many small coal mines closed during unusually severe winter storms early this year due to flooding and transport problems, while others have been shut due to safety concerns.

The NDRC, in a statement on its website (www.ndrc.gov), also urged large and medium-sized mines to boost output, and called on the transportation sector to make proper plans for coal shipment.

The coal sector has been dogged by persistent transport bottlenecks, helping to push domestic coal prices to record highs.

Coal shortages have also emerged in many provinces, with 39 power plants with 6.37 gigawatts of capacity, or about 1 percent of the nation's total, forced to halt generation, the State Electricity Regulatory Commission reported last Friday.

Concerns are rising about shortages as China heads into the peak electricity demand season in the summer. Coal fuels about 80 percent of the country's power generation.

The supply concerns are potentially at odds, however, with the government's crackdown in recent years on dangerous and inefficient small mines, which are to blame for China's deadly mine safety record.

Small mines produced 38 percent of the country's coal in 2007, according to the State Administration of Coal Mine Safety.

"Ensuring thermal coal supply is the top priority," said the latest NDRC statement.

It also asked power plants to maintain enough coal stocks for at least 15 days of use during the summer.

Coal stockpiles are below a government-set minimum level of seven days' supply in several parts of the country, the electricity commission said last Friday. (Reporting by Rujun Shen; Editing by Edmund Klamann)