A huge coalfield with 23 billion tons in reserve has been discovered in northwest China's Xinjiang Uygur Autonomous Region, the regional land resources department announced on Friday

The coalfield, about 800 meters underground, covers an area of more than 300 sq km in Shanshan County in the Turpan Basin.

The coal reserve, rich in low-sulfur steam coal, is close to the Lanzhou (Gansu's capital) - Xinjiang railway, the only rail line connecting Xinjiang to the inland cities.

It is also 800 km nearer to China's inland than the region's largest Zhundong coal production base, which could cut transportation cost by 40 yuan (5.8 U.S. dollars) per tonne.

Xinjiang, with estimated coal reserves of 1.82 trillion to 2.19 trillion tons, has 40.5 percent of China's total coal reserves. With an annual production of 50 million tons, it is the country's second largest coal producer after the northern province of Shanxi.

However, China is also a big coal consumer with a large amount of coal resources wasted every year. According to the 2007 Energy Blue Paper, while a tonne of coal was produced in China, five to 20 tons of coal resources were consumed.