September 7, 2010 (Chinavestor) China, the world's largest consumer of coal, will get more of the energy source from Russia in exchange for a $6 billion loan, according to the China Coal Transportation and Distribution Association. The association said Russia will boost coal shipments to China to at least 15 million metric tons annually in the next five years and more than 20 million tons in the following 20 years.
China has been looking to gain access to more coal as its domestic energy needs continue to swell. Yanzhou Coal (NYSE:YZC), China's fourth-largest coal producer, said it will pay $682.1 million to buy a majority stake in Mongolia's Inner Mongolia Haosheng Coal Mining.
China depends on coal to fuel 80% of its power plants. Imports from Russia surged 15-fold to 11.78 million tons in 2009, accounting for about 10% of total overseas purchases, according to Bloomberg News. Coal purchases from neighboring Russia cost an average of $87 a ton in 2009 compared with $111 a ton paid for cargoes from Australia, Bloomberg reported. China became a net importer of coal for the first time last year.