The Chinese National Development and Reform Commission (NDRC) plans to create several super-large coal mining companies by the end of 2020 through mergers in order to streamline and modernize the sector. Each newly created company would have a production capacity averaging around 100 Mt/year so that they could compete on the global market. As of today, only six Chinese coal mining companies have a yearly output of more than 100 Mt/year, including Shenhua Group, China Coal Energy Group and Datong Coal Mine Group. There are more than 4,000 coal mines with a cumulated capacity of 3.4 Gt/year.
This strategy would be in line with the Shenhua-Guodian merger aimed at creating the world's largest utility in 2017. The rationale behind the NDRC strategy would be to apply the same strategy for the coal mining industry. The planned mergers would also help China meet its target to eliminate nearly 800 Mt of outdated capacity and add around 500 Mt of advanced production. China expects coal production to average 3.9 Gt/year by 2020.
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