Beijing (AsiaNews/Agencies) - Beijing has set an official industry policy for the first time on supporting coal companies investing in overseas resources, as part of efforts to enhance the nation's long-term energy security, the National Development and Reform Commission said yesterday.

Experts say coal will be the principal source of energy in the country through to 2020. This makes Beijing vulnerable to the recent and repeated price hikes in the cost of coal, despite the fact that the country has the world's third-largest coal reserves of 114.5 billion tonnes or 12.6 per cent of the global total at the end of last year. However, on a per capita basis, it amounted to only 60 per cent of the world average, it has only 10 per cent of the global per capita oil reserves, 5 per cent of global per capita natural gas reserves.

Among the listed companies, only Yanzhou Coal Mining, which faced declining output in its home province of Shandong, has clinched an overseas investment. In late 2004, it bought a 90 per cent stake in the Austar mine in Queensland. It spent more than 1.5 billion Yuan to restore the mine which was damaged by a fire.

China Shenhua Energy, the nation's largest coal producer, has been in talks for more than three years to form a consortium to invest in a large coking coal project in Mongolia to feed steel industry demands. Shenhua is also exploring opportunities to buy into coal firms or mines in Indonesia and Australia. China Coal Energy, the second-largest producer, is also looking at investing in the two major coal exporters in Asia.