China National Petroleum Corp (CNPC), the parent of PetroChina, will give up its 50 pct stake in China United Coalbed Methane Corp (CUCBM), the official China Securities Journal reported.

Sun Maoyuan, general manager of CUCBM, was quoted as saying that a stake transfer is underway. No details were provided.

CUCBM, the former monoply coalbed methane producer, was set up as a 50-50 venture by China Coal Group and CNPC in 1996.

The central government decided earlier last year to allow other "designated companies" to sign deals with foreign firms to explore for CBM in a move to promote the development of the clean fuel.

CNPC, among others, is expected to win a license for CBM exploration, the paper said.

China holds around 30 trln cubic meters in reserves of coalbed methane, the world's third largest after Russia and Canada, but the use of the fuel is still in its early stages.

China's CBM Development Plan targets production of 10 bln cubic meters of CBM between 2006 and 2010.