UPDATE 1-Huaneng Power aims to end coal price fight

* Retreats from bid to cut contract coal price by 50 yuan/t

* Wants '09 price at last year's 504 yuan/t

* Sees miners and power firms resolving price issue soon (Adds details, quotes)

By Sui-Lee Wee

HONG KONG, April 2 (Reuters) - Huaneng Power International Inc (0902.HK), China's largest electricity provider, has retreated from its bid to cut contract coal prices, in an effort to speed talks between the country's coal miners and power generators, the company's chairman said on Thursday.

Huaneng (HNP.N) (600011.SS), which initially asked for a cut of 50 yuan per tonne in contract coal prices, and other major power firms have been in a price dispute for months with Chinese coal miners, who insist on a price rise.

"Our bottomline is that we want the coal price to remain at last year's level," Chairman Cao Peixi said, referring to the contract coal price set between China's miners and power producers.

The contract coal price was at 504 yuan per tonne in 2008.

"My feeling is that we are getting closer to a resolution. Negotiations will be quicker from here on," Cao told reporters.

The outlook for power producers is clouded by uncertainty over annual coal prices in 2009 and the high coal costs last year had sent Huaneng to a record second-half loss. [ID:nSP488441]

Huaneng plans to a total of 33 billion yuan ($4.83 billion) in capital expenditures in 2009, up from 28 billion a year ago.

But it has no plans to raise equity and any fundraising will come from issuing debt or bank loans, Chief Accountant Zhou Hui said.

Huaneng will import 6 million to 7 million tonnes of coal in 2009, up from 5 million last year. About 2 million to 3 million tonnes of this will come from Indonesia, Australia and Vietnam, President Liu Guoyue said.

Imported thermal coal is now cheaper than that in the domestic market.

About 60 percent of Huaneng's coal is signed at contract prices with the country's coal miners -- led by industry giant China Shenhua Group, the parent of China Shenhua Energy (1088.HK) (601088.SS) -- while the rest is bought from the spot market.

The firm expects to use 80 million tonnes of coal in 2009.

Many coal-fired power plants in China racked up losses last year because they cannot pass on the rise in coal prices to customers since the state sets power tariffs.

Spot thermal coal prices in China -- which struck record highs of more than 1,000 yuan a tonne last July -- have fallen back but are still more than a fifth higher than last year's contract price, eroding profitability for electricity providers. Thermal coal prices now hover around 550-565 yuan per tonne. ($1=6.833 Yuan) (Editing by Clarence Fernandez)