French engineering group Alstom announced a big strategic development on a global scale with Chinese partner SEC, in the field of coal-fired power generation, on Thursday.

Alstom and Shanghai Electric Group (SEC) are to create a joint venture for their global activities in supplying boilers for such power generating facilities, the company said.

Many experts see new, so-called "clean", technologies for coal-fired power generation as a solution to energy provision, and China is particularly dependent on coal-fired power generation, having big resources of coal.

The two groups see the new venture becoming the world leader in its field since sales by the two groups in this sector totalled about 2.5 billion euros ($3.64 billion) last year, Alstom said.

The venture, to be equally owned by each side, will be called Alstom-Shanghai Electric Boilers Co and will be registered in Shanghai.

Alstom said that demand for coal-fired power stations was particularly strong in emerging economies.

Alstom's chief executive Patrick Kron said that the creation of the venture marked "the first global project, on a world scale, tied up by Alstom with a Chinese partner."

It would be "an essential factor in developing our positions in China, the biggest market in the world, and in strengthening our global presence in coal-fired, turnkey power stations," he said.

The deal follows the signing in September of a draft agreement between Alstom and Chinese partners CNR and SEC to create a strategic partnership, mainly in the field of transportation. Alstom builds high-speed TGV trains.

The two groups are to develop two existing joint operations set up in 1999 between Alstom and SEC, Shanghai Alstom Transport Co. (SATCO) and Shanghai Alstom Transport Electrical Equipment (SATEE).

Alstom, which signed a strategic agreement with the Chinese government in the field of rail transportation and has won big contracts for the metro in Shanghai, already works with SEC on rolling stock.