UPDATE 1-China's Lu-an Coalmine plans 35 pct '08 output rise

(Adds details on potential foreign investor, IPO)

BEIJING, April 14 (Reuters) - Major Chinese coal producer Lu-an Coalmine Group aims to expand output of the hydrocarbon by 35 percent in 2008 to feed the world's largest coal market, and has shortlisted a group of global firms as potential investors to anchor its expansion at home and abroad.

Lu-an, based in northern China's Shanxi Province, plans to churn out 50 million tonnes of coal this year, up from 37.18 million tonnes of coal in 2007, general manager Ren Runhou told Reuters on the sidelines of a coal conference in Beijing.

It aims to house annual capacity of 100 million tonnes by the end of 2015.

The firm wants to expand abroad but has shelved plans to float shares overseas for the time being because Beijing discouraged its listing abroad, Ren said without elaborating, delaying its ambition of joining larger listed rivals China Shenhua Energy Co (1088.HK) (601088.SS) and China Coal Energy (1898.HK) (601898.SS).

Lu-an is on track to start coal-to-liquids production in August, via a project with an initial-phase capacity of 160,000 tonnes per year. That will be expanded to 3 million tonnes by the end of 2010 and to 5.2 million tonnes by end-2015, Ren added.

Lu-an aims to achieve 15 million tonnes of oil production a year from that project eventually.

Last year, China's cabinet picked Shenhua, China's top coal producer, Yankuang, parent of Yanzhou Coal (1171.HK), and Lu-an to conduct coal-to-liquid projects in China. (Reporting by Nao Nakanishi and Shen Rujun; Editing by Edmund Klamann)