The enormous Ordos Basin in Northwest and North China, nicknamed the "energy bank for the 21st century", is on the brink of a coal rush.

Since the 1980s, Chinese geologists and engineers have reported a variety of new energy resources in the 370,000-sq- km basin, which covers Shaanxi, Shanxi and Gansu provinces and Ningxia Hui and Inner Mongolia autonomous regions. It is roughly the size of Japan and accounts for 4 percent of China's territory.

The basin contains over 35 percent of China's energy resources. It contains estimated reserves of 8.59 billion tons of oil, 10.7 trillion cu m of natural gas and 3.98 trillion tons of coal, along with uranium and underground water supplies.

The latest development is a coal exploration project by the National Development and Reform Commission (NDRC) in a bid to ease China's energy crisis and ensure a long-term fuel supply.

The International Energy Agency predicted that China's energy demand will climb by 2.7 percent annually to 2030, when annual demand will reach 3.19 billion tons of standard coal.

Huang Shengchu, president of Research Center for Coal Information, says the Ordos Basin has helped shore up the nation's energy supply and the regional economy, especially when it comes to coal.

Six of 13 major national coal mines are in the Ordos Basin.

In the past, coal resources of Ordos Basin weren't being fully exploited due to small mines with low efficiency, Huang says.

However, some smaller mines with an annual capacity of about 200,000 tons have been transformed into larger operations with annual outputs of 1 million to 3 million tons, Huang adds.

Compared with the annual output of China's largest coal producer, Shanxi province at 600 million tons in 2007, the entire Ordos Basin produced roughly 160 million tons in the same period. But Ordos Basin is likely to soon overtake Shanxi province as the country's top coal producer, Huang predicts.

Huang stresses that officials should pay attention to environmental protection in the basin, especially when it comes to preventing over-exploration and strip mining.

"The economic benefits to the local economy by previous exploration at Ordos Basin have been seen, for example in the fast pace of modernization at cities like the (Inner Mongolian) city of Ordos," Huang says.

"More changes are expected to happen," Huang adds.

The push for more coal will have a huge impact on neighboring Shaanxi province as well, says one Shaanxi official.

"All new (coal) exploitation plans are under discussion at present," says Wang Jianping, officer of Shaanxi Provincial Development and Reform Commission. "About 90 percent of Shaanxi's energy resources are located in the Ordos Basin portion of the province, so appropriate exploration is key to the economy and deserves a lot of consideration," says Wang.

Rich natural resources

Ordos is not only abundant in coal, but also in other natural resources crucial to China's economic development.

The basin has reserves of 8.95 billion tons of oil, including recoverable reserves of 2.4 billion tons.

A total of 36 oilfields have been discovered in the basin, including Xifeng oilfield, the largest found in the past 10 years, that has reserves of 400 million tons.

The annual oil output of Ordos Basin is expected to exceed 20 million tons by 2020.

Its 10.7 trillion cu m natural gas reserves account for 28.8 percent of China's total natural gas reserves.

Four of five 100 billion cu m gas fields in China are located in Ordos Basin and the output of natural gas is expected to reach 40 billion to 50 billion cu m per year in 10 years.

Ordos also contains an estimated 10.5 billion cu m of underground water.

(China Daily 03/03/2008 page4)