Following a series of high-profile mining disasters, the government announced plans to consolidate China's massive coal mining industry into around 13 mining groups.
The move was designed to improve efficiency as well as boost safety in the world's most deadly mining industry by strengthening government regulation of the industry, officials from the National Development and Reform Commission said.
According to government figures China has around 28,000 coal mines, of which some 24,000 are small, privately-owned and poorly regulated operations.
The 13 new coal enterprise groups are expected to be set up in the coal-rich northern provinces of Shaanxi and Shanxi, and Inner Mongolia, the China Daily quoted an official with the National Development and Reform Commission as saying.
"The construction of the bases will help tap potential coal resources and alleviate energy shortages … to ensure stable supplies and safety," the newspaper said.
The announcement comes amid growing concerns that coal production is failing to keep pace with the demands of the economy. In the first 10 months of 2004, China' coal mines churned out 1.6bn tons of coal, a year-on-year increase of 19%. And yet, in spite of that growth, consumer demand in many areas continues to outpace supply.
Despite efforts to encourage the development of cleaner energy sources, coal remains the driving fuel behind the country's economic growth, accounting for around three quarters of China's energy output. According to government estimates, coal will remain the country's number one energy source for at least the next 30-50 years.
No timetable was given for the consolidation process to take place, although more detailed plans are expected to be drawn up by early in the year.