Shanxi halts colliery approval to tackle overcapacity

Shanxi Province in north China will approve no new coal mines for the next five years to tackle excess capacity.

In line with a guideline, published on Monday, for the next three years there will be a moratorium on upgrades to collieries with an annual capacity of under five million tonnes that intend to become open-cast mines.

Shanxi is China's major coal producer, but weak demand and constantly increasing supply has led to closure of many mines.

A mere 960 million tonnes of coal were produced in Shanxi in 2013, far below its production capacity of 1.36 billion tonnes, according to government figures.