The Chinese government has halted handling new applications for coal prospecting rights to prevent investment in coal mining from overheating, according to the Ministry of Land and Resources.

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The suspension lasts from February 2 this year to the end of 2008, when applications for selling prospecting rights through competitive channels like bidding will neither be handled.

However, major coal exploration projects approved by the State Council, as well as surveys of coal resources with the support of special geological funds from the central and provincial governments, can continue to set up new prospecting rights.

Sources with the ministry said the move aims to prevent an oversupply of coal in the country and keep coal production stable.

China's crude coal output reached 2.325 billion tons in 2006, up 8.1 percent year on year, according to the State Administration of Coal Mine Safety.

China's crude coal production dropped to a low of 999 million tons in 2000, and then rebounded to 1.415 billion tons in 2002 and 1.997 billion tons in 2004.

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