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China's state planner issues draft rules for coal production reserve system

BEIJING (Reuters) - China will establish a coal production reserve system by 2027 to stabilise prices and ensure sufficient coal supply, according to draft rules issued by the state planner for public comment on Wednesday.

The draft did not give details on exactly how the system would work, but said the aim was to have 300 million metric tons of "dispatchable" annual coal production by 2030.

China previously set a goal to have coal reserves equivalent to 15% of its annual consumption, which is currently at mines, ports, power plants and some designated storage areas.

The notice by the National Development and Reform Commission also said the system would involve new mining projects, which must have at least 3 million tons of production capacity a year.

The mines, which have to apply for approval, must also be able to dispatch output when the government deems spot prices to have exceeded a "reasonable" range or when supplies are tight.

The notice comes amid a renewed push by China to guarantee energy supplies following a crippling domestic coal and power shortage in 2021, as well as a European energy crisis last year in the aftermath of Russia's invasion of Ukraine, which sent prices of natural gas soaring.

(Reporting by Andrew Hayley and Colleen Howe; Editing by Tom Hogue and Miral Fahmy)