Ukraine – which has the world’s sixth largest coal reserves at some 34 billion economically minable tonnes – has historically struggled to advance its coal mining and power generation technologies until rising public demand for electricity prompted increased domestic and foreign investment in the country’s coal sector.

China’s official state media outlet Xinhua quoted Ukraine Prime Minister Mykola Azarov on the subject when he spoke Tuesday at a meeting with China Development Bank vice president Li Jiping.

“The substitution of expensive imported gas with coal is a strategic issue for us,” he said.

“We are interested in the Chinese technology of coal gasification and coal-water fuel production.”

Xinhua reported that the China Development Bank is ready to set up a $US3.7 billion credit line to help Ukraine switch its power plants from gas to coal after a signed protocol of cooperation between Beijing and Kiev opened the door for funding of the technology.

Ukrainian President Viktor Yanukovych is expected to discuss new large-scale coal gasification projects this November after successful implementation of preliminary projects.