CUCBM in talks with potential investors to raise up to 20b yuan

State-owned China United Coalbed Methane (CUCBM), the mainland's pioneer explorer of the gas, which is increasingly seen as a clean energy source, wants to raise 10 billion to 20 billion yuan (HK$22.70 billion) in the next two to three years.

The Beijing-based firm is in talks with would-be strategic investors, chairman Sun Maoyuan told the South China Morning Post, without giving details about the potential investors.

'We need to move from a state-funded company to one with multiple sources of funding,' he said. 'To do this, we must become a profitable entity operating on market-based principles.'

He said the company had classified its projects by maturity and investment risks to facilitate discussions with potential investors.

Set up in 1996 as China's sole state-owned coalbed methane (CBM) developer with registered capital of 100 million yuan, the company enjoys exclusive rights to form CBM joint ventures with foreign companies.

To speed up development of the CBM industry, the central government issued a circular in May last year on a trial to extend those rights to large state-controlled coal miners and oil and gas producers.

PetroChina, a former shareholder of CUCBM, China Petroleum & Chemical (Sinopec) and Shanxi province coal miner Jincheng Anthracite Coal Mining Group had all applied, Xinhua reported.