Nov. 25--Peabody Energy Corp. has an office in Beijing and is pursuing a project in inner Mongolia to help feed China's ravenous growth. Across town, rival Arch Coal Inc. is eyeing the world's largest economy from afar.

Creve Coeur-based Arch, the nation's No. 2 coal producer, has scheduled test shipments of coal from its Black Thunder mine in northeast Wyoming to China for test burns at power plants. If trials are successful, commercial deliveries could begin next year, company Vice President Deck Slone said.

Arch didn't reveal when shipments would occur or estimate how much coal it thinks it could ultimately sell. But "even being a small player could translate into significant volumes over time," Slone said.

China, the world's largest coal consumer, is expected to build dozens of new power plants, representing a significant opportunity for Arch and rivals with mines in coal-rich Wyoming and Montana.

But there are likewise sizable challenges, including an anemic global economy and strengthening U.S. dollar, which makes domestic products more expensive.

"The world has changed pretty rapidly in the past few months and what appeared to be priorities then might not be priorities now," said Paul Forward, an analyst at Stifel, Nicolaus & Co. in Washington. "Until a few months ago, the world was short of coal. But we've seen a real pullback of coal into major export markets."

Arch executives believe a market for Powder River Basin coal will develop in China, even if it's at a slower pace than seemed several months ago.

Almost 80 percent of China's electricity is generated with coal, and in 2007 the country became a net importer of the fuel, according to the Energy Information Administration, part of the U.S. Department of Energy. Even if economic growth slows to 7 percent from 9 percent in the third quarter, an additional billion tons of coal will be needed in five years -- almost as much as the U.S. consumes annually.

While China is rich in coal, it's scrambling to keep up with demand, said Slone, part of an Arch delegation that visited China recently. "Logistically for China, it's a challenge. It's a challenge to mine enough and to move it from where it's being mined to where it's needed."

There are likewise doubts about the ability of neighboring coal exporters such as Indonesia and Vietnam to fill the void given their own energy needs, infrastructure requirements and competition for coal from another fast-growing nation -- India.

The Powder River Basin, a geographic area covering 24,000 square miles in northeast Wyoming and western Montana, would seem to be an obvious place to turn.