issue between the exploration right of CBM and coal. In case of new mineral resources prospecting right, CBM, coal resources must be prospected, evaluated and their reserves must be determined. If the density of gas per ton in the coalbed surpasses that of the regulated standard and suffices to be developed, a CBM and coal development plan must be composed; ground surface CBM drainage is preferred. With this as their ground, Jincheng Coal Group filed a report to the Coordination Leadership Team of the Development and Reform Committee of Shanxi Province, the State Development and Reform Commission, and the People’s Congress of various levels and other departments, suggesting that as the parties authorized to implement the “integrated CBM recovery and coal mining,” the coal enterprises have the right to recover and utilize CBM/CMM.21 In 2006, the investigation team concluded that Jincheng Coal Group conducted “illegal gas drainage.” However, no sanction was actually made. Instead, it attempted to address the disputes through negotiation. In April, 2007, MLR published a Notice on Strengthening Coal and CBM Comprehensive Prospecting and Mining Management (MLR [2006]96). The Notice provides three means to
address the issue over overlapping mining rights of coal and CBM/CMM: 1) it requires the MLR and local land and recourse bureaus to carry out a thorough survey of CBM exploration and mining rights within its jurisdiction, submit a report of the blocks failing to meet the minimum prospecting investment, then MLR decides whether to reduce the amount by legal means or repeal the right; 2) the coal mining right owners who have coal mining licenses should try to apply for a CBM draining license later if they drain the CBM by means of ground surface drainage within its mining area; but no CBM draining license is required for recycling the underground gas, which is the CMM. This is the first time the MLR made a distinction between CBM and CMM; 3) in case there is overlapping of mining rights which fails to end with a co-operation agreement, the two parties should try to negotiate ways of co-operation or sign safe production agreement. Based on the principle “CBM drainage first, coal mining second,” conducting comprehensive prospecting and mining of coal and CBM; if both parties fail to reach any agreement 6 months after the notice is issued, the MLR will conduct a mediation. If both parties agree to mediation, the overlapping part excluded, one party will make compensations to the other for its investment in the excluded part. In case mediation fails, the land and natural resources bureau will act in accordance with
Figure 4: Office Building of CUCM’s Panzhuang CBM Co. in Qingshui County
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