China became a net coal importer as imports exceeded exports by 2.89 million tons in the first quarter, says a report issued by the National Development & Reform Commission on Monday. From January to March, coal exports slumped 32 percent to 11.4 million tons while imports surged 61 percent to 14.3 million tons, figures from the General Administration of Customs show. In 2006, the government abolished export tax rebates on coal and imposed export tariffs, while cutting import duties in an effort to curb pollution and its fast-growing trade surplus. In the first quarter of last year, the country exported more coal than it imported by 7.89 million tons.

About 3.8 trillion cubic meters of natural gas deposits have been discovered in southwest China's Sichuan Basin, with verified exploitable reserves topping 600 billion cubic meters. The reserves were discovered in Dazhou, a gas-rich city in Sichuan Province. By 2010, the newly found deposits will raise the city's gas output to 24 billion cubic meters and sulphur to more than 4.3 million tons, according to a Dazhou official. China National Petroleum Corporation (CNPC), the country's biggest oil and gas producer, and Sinopec Corporation, China's largest refiner, plan to build five purification plants in Dazhou and are expected to purify a total of 74 million cubic meters of natural gas a day by 2010.

The Chinese government plans to introduce new measures on June 10 to regulate imports of natural gas in order to protect its three major gas importers from intense domestic competition. Sources with the Ministry of Commerce said on Tuesday that the move would end the chaotic competition between China's three oil and gas giants—China National Petroleum Corp, Sinopec and China National Offshore Oil Corp—in the purchase of gas, which has helped overseas exporters raise prices. The competition has been blamed on the lax import system for natural gas that is currently in place. Enterprises, at present, do not have to satisfy any conditions to obtain import permits for natural gas. After June 10, each application for an import permit will be examined and approved.

China aims to slash its energy consumption per 10,000 yuan of GDP by 20 percent by 2010 so natural gas, seen as an ideal way to meet this target, is now in huge demand nationwide. Apart from the Big Three, enterprises controlled by local governments have joined the competition for gas imports, which is contributing to a further hike in prices. According to the National Development and Reform Commission, Indonesian exporters have adjusted the price of LNG (liquefied natural gas) from 25 U.S. dollars per barrel to 38 U.S. dollars per barrel for Chinese buyers in eastern China's Fujian Province. The commission also revealed that the price of natural gas exported by Russia to China is likely to be raised to 180 US dollars per 1,000 cubic meters.

The Chinese government is close to dropping tariffs on technologies that increase energy efficiency and decrease pollution in an important move towards tackling global warming. Wu Yi, the Chinese vice-premier said China is agree to eliminate tariffs, some as high as 16 percent, on technology hardware and energy services as it seeks to increase the efficiency of its power-generating plants and, in turn, reduce the production of harmful emissions.