(EnergyAsia, February 27, Friday) — Puda Coal Inc, a US-listed supplier of high grade metallurgical coking coal used in steel manufacturing, said it has signed a letter of intent with a local county government in China’s Shanxi province to consolidate the county’s six coal mines and build a coal power plant.

The county will apply for project approval from the Shanxi provincial government for consolidation of the coal mines. Upon receiving the approval, Puda Coal said it will work with the county to consolidate and restructure the six coal mines. The company will also work with the county to construct a 2×135 MW coal power plant.

Liping Zhu, CEO and President of Puda Coal, said: “We look forward to the opportunity to leverage our experience in the coal industry to consolidate and fully utilize the mines and to construct a coal gangue power plant to help serve China’s increasing demand for energy.”

Through its subsidiaries, Puda Coal supplies premium grade coking coal to the steel making industry in China for use in making coke. The company currently possesses 3.5 million metric tons of annual coking coal cleaning capacity.

Shanxi Province provides up to a quarter of China’s coal output and supplies nearly 50% of China’s coke.