Page 8, Economic Daily, June 7, 2007

Staff Reporter Sun Yong

In order to quicken the steps of transporting coal from North China to other parts of the country and promote regional balance of the strategic resource, the State Development and Investment Corporation (SDIC) has decided to list the construction of a coal transport channel as one of the key strategic projects of the company. SDIC therefore conducted a research on construction of a third channel to transport coal from North China to other parts of the country and participated in, as one of the initiators, investing in construction of the Datong-Qinhuangdao Railway expansion project – the Qian’an-Caofeidian Railway project. As the controlling shareowner, SDIC also launched the construction of the Caofeidian 50-million-ton coal dock, the Jingtang Port 30-million-ton coal dock and the Longkou Port 100,000-ton general-purpose dock. The four projects are under smooth construction.

Planned total investment in the above-mentioned four projects reaches 15 billion yuan and up to date, a total of 8.5 billion yuan of investment has been put into place. The Jingtang 30-million-ton coal dock project will be completed and put into operation in August this year; the Caofeidian 50-million-ton coal dock is expected to be completed and put into operation in April next year; the Qian’an-Caofeidian Railway project will be completed simultaneously with the Jingtang and Caofeidian projects; and the Longkou 100,000-ton general-purpose dock will be completed by the end of next year.

In China, coal resources are mainly scattered in the northwest regions of the country and coal reserves in Shanxi Province, the Inner Mongolia Autonomous Region and Shaanxi Province account for 64.1% of the country’s total and they are also the major coal production bases in the country in recent years. In 2003, Shanxi, Inner Mongolia and Shaanxi turned out a total of 709 million tons of coal, accounting for 43.5% of the country’s total coal output. In 2006, their combined coal output hit 943 million tons, accounting for 45.8% of the country’s total. Along with increasing demand for coal, Shanxi, Inner Mongolia and Shaanxi will witness their ratio of coal output in the country’s total production to increase further.
Although coal resources are mainly scattered in the northwest regions of China, coal consumers are mainly in the coastal areas of East and South East China. This production-consumption distribution structure forms the characteristics of “transporting coal from West China and North China to East China and South China”. The coal production regions of Shanxi, Inner Mongolia and Shaanxi shoulder the majority part of the tasks of transporting coal to other parts of the country and they account for over 90% of the cross-region coal transport volume.

In accordance with the location of railways and ports, origins and destinations of coal, there are three major channels for cross-region transport of coal from Shanxi, Inner Mongolia and Shaanxi, namely the north channel, the middle channel and the south channel. At present, the north channel consists of the Datong-Qinhuangdao and Shuohuang railways and the Qinhaungdao, Tianjin, Tangshan and Huanghua ports，of which the Datong-Qinhuangdao Railway and the Qinhuangdao Port are called the first coal transport channel and the Shuohuang Railway and the Huanghua Port are called the second coal transport channel; the middle channel consists of the Shitai, Hanchang and Hanji railways and the Qingdao Port; and the south channel consists of the Houyue and Longhai railways and the Rizhao, Lianyuangang ports. At present, the north channel accounts for more than 70% of the total volume of cross-region coal transport from Shanxi, Inner Mongolia and Shaanxi to other parts of the country.

Coal is a major energy resource in China, and Shanxi, Inner Mongolia and Shaanxi are the major coal producing bases. Therefore, the situation of transporting coal from north and west to east and south is expected to exist for a long period of time. In China, coal tops the country’s energy resource issues and transportation plays a crucial role.

The research group of transporting coal from north to other parts of the country under the National Development and Reform Commission believes that in the long run, the fundamental way to break the bottleneck of transporting coal from north to other parts relies on construction of the third channel. In short term, the most practical measure is to improve the coal transport capacity through renovation and expansion. Therefore, the research group suggested to construct the third transport channel as quickly as possible and in the meantime, renovate the existing coal transport facilities and open new coal loading docks at the Caofeidian Port and the Longkou Port.

Obviously, the location and conditions of the Datong-Qinhuangdao Railway indicates it has a great potential for renovation and expansion, which is a shortcut to ease the shortage of transport capacity. Against such a background, the Ministry of Railway has decided to improve the standard of the Datong-Qinhuangdao Railway and carry out renovation to increase its annual transport capacity from 150 million tons in 2004 to 400 million tons 10 years later.