So far China has more or less established a policy system to promote the mining and use of coal gas (CBM). The system will fully waken the business initiatives, effectively promoting the development and utilization of coal bed methane as well as improving the safety condition of coal production.
The State Council announced “A Number of Opinions on Speeding up the Mining and Use of CBM” in 2006, proposing 16 measures and confirming the guiding principles of recovering proceeding mining and equal focus on control and utilization. A source from NDRC Bureau of Energy indicates relevant departments and local governments have been actively implementing the State Council’s planning, and the initial results are significant.
Most provinces and municipalities have formulated favourable tax and fee policies, which have been fulfilled at local enterprises. Such tax relief concessions include the following: specialized equipments and tools for prospecting and recovering CBM are exempted from import duty and import value added tax; CBM recovering enterprises will have their VAT refunded and enjoy accelerated depreciation, investment tax credit and deduction of technological upgrade fees, and a temporary zero resource tax will be carried out for the ground level recovering of CMB.
