More Chinese gas firms allowed to tie up with foreign firms

More “state-designated” companies are allowed, from Monday, to set up ventures with foreign partners to explore methane trapped in coal seams, the China Daily said, citing a revised rule by the State Council, or Cabinet.

In the past, China United Coal-bed Methane Corp was the only company allowed to do so according to a 2001 version of the rule, the report said.

Analysts said the move would speed up the development of the industry as more funds and advanced technology would enter into China’s coal-bed methane exploration and production, the report said.

“To further tap coal-bed methane, the state will bring a few new players into the field to test the water,” said Sun Maoyuan, general manager of China United Coal-bed Methane Corp.

“But our potential competitors simply do not boast as big reserves as us, and it will take time for them to develop.”

The company has recently won official approval to produce 500 million cubic meters (17.5 billion cubic feet) of gas annually with Asia American Gas Inc in north China’s Shanxi province, the newspaper said.

China has 37 trillion cubic meters in coal-bed methane reserves, the third largest in the world after Russia and Canada, it said.

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