The Sihe longwall mine in Shanxi Province is owned by the Jincheng Anthracite Mining Group.
China’s coal mines released about 6 billion m3 of methane into the atmosphere in 2003, a gas 21 times more potent than carbon dioxide as a greenhouse gas.
Methane recovery post mining is rare in China and it is hoped the demonstration of the new technologies will catalyse development of similar approaches in China.
The methane will be drained from underground workings and produced from surface wells using modern equipment, materials, and methods. Power generation will be achieved using individual internal combustion gas engines.
The power generated will be used to provide power to the Sihe mine. Coal mine methane from other mines in the Jincheng area will also be collected for distribution to residential, commercial, and industrial consumers.
"Environmental benefits from the project will be felt not only in the surrounding area but should also be considered in the context of reduced greenhouse gas emissions," said ADB principal project specialist Edu Hassing.
The project is expected to be able to sell greenhouse gas emission reductions. ADB said the Chinese Government had reached general agreement with the World Bank's Prototype Carbon Fund for the sale of 4.5 million tons of CO2 equivalent of greenhouse gas emission reductions that will be generated by the project.
ADB said there was considerable potential for sale of additional greenhouse gas emission reductions, particularly when the Clean Development Mechanism of the Kyoto Protocol becomes effective on February 16.
By 2008 about 90,000 households and various industries and commercial establishments will be served with a minimum of 166 million cubic meters of coal mine methane per year from the project. About 410,000 people in Jincheng will directly benefit from cleaner energy.
"After the project is completed and has demonstrated that a coal mine methane-fired power plant can operate successfully in conjunction with coal mining activities, the potential for private sector participation in plant operation will be considerable," Hassing said.
"There is also a great deal of potential to build similar power plants in the future, as the demand for power and coal mine methane production are only expected to increase in the coming years."
The total cost of the project is estimated at US$237 million, of which additional loans of $20 million will come from the Japan Bank for International Cooperation and $37.86 million from the Industrial Bank of China. The Jincheng municipal government and two of the mining/industrial groups will provide equity capital totaling $61.24 million. The United States Trade and Development Agency has also provided a grant of $500,000.
