China, the world's biggest consumer of coal, says demand and supply of the fuel will "generally balance" by 2010 as producers boost capacity to meet growing energy needs.

The nation's annual demand for coal will be about 3 billion metric tons within the next three years, close to projected production capacity, Wang Xianzheng, chairman of the China Coal Industry Association, said at a conference in Beijing yesterday.

China produced 2.54 billion tons of coal last year, representing an annual increase of 10 percent over the past seven years, Wang said, Bloomberg News reported.

Capacity for another 1.1 billion tons a year is being added, while the government aims to cut small-mine capacity to less than 700 million tons a year by 2010, from the current one billion tons, he said.

"Despite the balance, regional or sporadic shortages or surpluses of certain kinds of coal products are likely," Wang said.

The current overall supply of thermal coal to power plants is adequate and shortages are "regional."

Closure of small mines will not affect supplies, he said.

(Shanghai Daily May 25,2008)