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China has eliminated 29.4 million tons of outdated iron smelting capacity and 15.21 million tons of outdated steel smelting capacity by the end of November, the National Development and Reform Commission (NDRC) said on Thursday.

"Eliminating backward iron and steel production capacities will help the country realize its environmental protection and energy-saving goals and facilitate the industry's restructuring," said NDRC Minister Ma Kai at a national iron and steel industry conference.

After the State Council, China's cabinet, held a teleconference on energy-savings in April, the NDRC signed obligation contracts of cutting iron and steel smelting capacity with 10 provinces, autonomous regions and municipalities, included Beijing, Hebei, Shanxi, Henan, Jiangsu, Shandong, Zhejiang, Jiangxi and Xinjiang, where the country's outdated iron and steel production capacities were mostly concentrated. This involved 344 iron and steel makers.

Four provinces, namely Zhejiang, Jiangxi, Henan and Shandong, had fulfilled their targets by November.

Shanxi, which shouldered the heaviest task of iron production capacity reduction in the first batch of 10 provincial-level regions, had completed 90 percent of its 10 million-ton quota.

The NDRC, the country's top economic planner, signed the second batch of obligation contracts with 18 provinces, autonomous regions and municipalities on Thursday to eliminate 49.31 million tons of outdated iron smelting capacity and 36.1 million tons of outdated steel smelting capacity. This involved 573 enterprises and included Baosteel, the country's biggest iron and steel manufacturer.

China decided to reduce energy consumption per unit of gross domestic product (GDP) by 20 percent by 2010, and to build the country into an energy-efficient and environmentally-friendly society.

However, energy consumption per unit of GDP fell only 1.23 percent last year, less than one-third of the average annual goal of four percent.

"Although the project of shutting down those outdated iron and steel smelters has achieved tangible results, there are still arduous tasks on the way ahead," Ma said.

The NDRC launched the "Top 1,000 Enterprise Energy Efficiency Action Plan" in September. This required the country's 1,000 largest domestic enterprises in iron and steel, petrochemical and other sectors to meet global energy efficiency requirements and to save 100 million tons of standard coal by 2010.

In a similar development, water consumption for each 10,000 yuan (US$1,368) of value-added industrial output fell 8.9 percent to 154 cubic meters in 2006 compared with the previous year, the NDRC revealed.