A coal sustainable development fund will stop operations on Dec 1. The fund has been running for more than seven years.

China will stop resource compensation for coal, crude oil, natural gas and mineral resources nationwide on Dec 1, 2014. The country will also stop levying price regulation funds for coal, crude oil and natural gas, according to the Ministry of Finance and the National Development and Reform Commission. It will cancel the coal sustainable development fund in Shanxi, ecological compensation for mineral products in Qinghai, and the local economic development fund for coal resources in the Xinjiang Uygur autonomous region.

In April 2006, the State Council decided to choose Shanxi as a pilot area for coal industry sustainable development. Shanxi passed and published the coal sustainable development fund collection management methods in March 2007. It aimed to develop an inner mechanism to increase the coal recovery rate. It also sought to build an ecological environment recovery mechanism and coal city transformation and key replacement industry development assistance mechanism. The fund was mainly used for cross-regional ecological environmental governance to support resource-based city transformation and major replacement industry development, and also solve social problems caused by coal mining.

Analysts pointed out that China has revoked some coal, crude oil and natural gas funds to pave the way for the coal resource tax reform, which will go into effect on Dec 1 and ensure the reform won't add a burden to coal enterprises.

Edited by Michael Thai