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Foreword
Mineral resources
are an important part of natural resources, and an important material
foundation for the development of human society. Great achievements have
been obtained in the survey and development of China’s mineral resources
in the past five decades since the founding of New China. A great number
of mineral resources have been verified, and a fairly complete system for
the supply of mineral products has been established, providing an
important guarantee for the sustained, rapid and healthy development of
the Chinese economy. At present, over 92% of the country’s primary energy,
80% of the industrial raw and processed materials and more than 70% of the
agricultural means of production come from mineral resources.
China attaches great importance to sustainable
development and the rational utilization of mineral resources, and has
made sustainable development a national strategy and the protection of
resources an important part of this strategy. Immediately following the UN
Environmental and Development Conference in 1992, the Chinese government
took the lead in formulating the “China Agenda 21 — the White Paper on
China’s Population, Environment and Development in the 21st Century.” It
approved and implemented the “National Program on Mineral Resources” in
April 2001, and, in January 2003, began to implement “China’s Program of
Action for Sustainable Development in the Early 21st Century.”
To build a well-off society in an all-round way is
China’s objective in the first 20 years of the new century. China will
depend mainly on the exploitation of its own mineral resources to
guarantee the needs of its modernization program. The Chinese government
encourages the exploration and exploitation of the mineral resources in
market demand, especially the dominant resources in the western regions,
to increase its domestic capability of mineral resources supply. At the
same time, it is an important government policy to import foreign capital
and technology to exploit the country’s mineral resources, make use of
foreign markets and foreign mineral resources, and help Chinese mining
enterprises and mineral products enter the international market. The
Chinese government holds that to have foreign mining companies enter China
and Chinese mining enterprises enter other countries to make different
countries mutually complementary in resources is of great significance for
the common prosperity and healthy development of world mineral resources
prospecting and exploitation.
I. The
Present Situation of Mineral Resources and Their Exploration and
Exploitation
China has discovered 171
varieties of minerals, and 158 of them with proved reserves. There are 10
energy-related minerals, including oil, natural gas, coal, uranium and
geotherm; 54 metallic minerals, including iron, manganese, copper,
aluminum, lead and zinc; 91 non-metallic minerals, including graphite,
phosphorus, sulfur and sylvite; and 3 liquid minerals, including
groundwater, and mineral water. There are nearly 18,000 mineral deposits
in China, including more than 7,000 big and medium-sized ones.
The basic characteristics of China’s mineral
resources are:
— The total quantity of the resources is fairly big
and there is a fairly complete variety of minerals. China has found a
rather complete variety of mineral resources, and a fair abundance of
mineral resources in total quantity. Large reserves have been verified of
major minerals, such as coal, iron, copper, aluminum, lead and zinc. The
country enjoys obvious advantages in the world in the resources of coal,
rare earths, tungsten, tin, molybdenum, antimony, titanium, gypsum,
bentonite, mirabilite, magnesite, barite, fluorspar, talc and graphite.
There are abundant geothermal and mineral water resources, and the quality
of the groundwater is good on the whole.
— The per-capita quantity of the resources is
small, and there is an imbalance between supply and demand for some of the
resources. The huge population and the low per-capita quantity of mineral
resources are a basic national condition in China. The per-capita quantity
of mineral resources held by the Chinese people is at a comparatively low
level by global standards. There are acute shortages of diamonds,
platinum, chromite and sylvite.
— Superior mineral ores exist side by side with
inferior ones. There are both high-quality ores and those of low grade and
complex constituents. The quality is fairly high for tungsten, tin, rare
earths, molybdenum, antimony, talc, magnesite and graphite, while in the
case of iron, manganese, aluminum, copper and phosphorus there is an
excess of low-grade ores, paragenous and associated ores and those
refractory for dressing and smelting.
— The resources with a low degree of geological
control account for a greater proportion of the verified reserves of the
mineral resources. In the structure of the verified reserves of the
resources, there are more resources, but less reserves or basic reserves;
more resource reserves with poor economic workability or with uncertain
economic significance, but less resource reserves with ideal economic
workability; more controlled and deduced resource reserves, and less
verified resource reserves.
— The conditions for mineralization are good, and
there are good prospects for finding more mineral resources. There is a
big potential for finding more oil, natural gas, gold and copper. The
deeper formations and outlying areas of the old mining areas and the
western regions are the major substitute areas of mineral
resources.
China was one of the first countries in the world
to develop its own mineral resources. After the founding of New China, the
Chinese government made great efforts to strengthen geological work, and
explicitly demanded that this work should go ahead of the economic
construction. It formulated the strategic principle for “the development
of the mining industry” and made specific arrangements for the exploration
and development of mineral resources in all its five-year plans. Great
progress has been made in the exploration and exploitation of mineral
resources, so that China has gradually become a major country in mineral
resources and the mining industry. Mineral resources prospecting and
exploitation have supplied large quantities of energy and raw and
processed materials for economic construction; provided important sources
of revenue; accelerated the development of regional economies, especially
economic development in regions inhabited by the ethnic minorities as well
as remote and border areas; promoted the rise and growth of mining cities
(townships) with mineral resources exploitation as their pillar industry;
and solved the problem of employment for large numbers of local people,
thus making a major contribution to socio-economic development in the
country.
— A large number of mineral resources have been
discovered and ascertained. The discovery and construction of a large
batch of oil and gas fields, represented by the Daqing Oilfield, has
turned China from an oil-poor country into one of major oil-producing
countries in the world. China has discovered or expanded a number of major
mineral deposits, including the rare-earth metal mine in Bayun Obo, the
Dexing Copper Mine, the Jinchuan Nickel Mine, the Shizhuyuan Tungsten
Mine, the Luanchuan Molybdenum Mine, the Ashile Copper Mine, the Jiaojia
Gold Mine, the Yulong Copper Mine, the Dachang Tin Mine, the lead-zinc
mines at Changba and Lanping, the Dongsheng-Shenmu Coalfield, the
Zijinshan Copper-Gold Mine and the Yangbajain Geothermal Field. It has
also discovered and ascertained a number of major sources of groundwater
supply. Parts of the western regions have gradually revealed good
prospects for finding mineral resources. New resources have been found in
the outlying areas or deeper strata of some of the existing mines. A
succession of achievements has been made in the new round of large-scale
land and resources survey. The surveys of mineral resources over the past
50 years and more have turned China from a country with uncertainty on
mineral resources to a country rich in mineral resources, from a country
with little-known groundwater resources to a country with groundwater
playing a key role in the national water supply. At the same time, China
has fostered a large contingent of geological surveyors with a fine
tradition and working style, and strong technical forces, who have made
important contributions to economic construction in China.
— The scale of mineral resources exploitation has
expanded rapidly. In 1949, China had just over 300 properly developed
mines, producing annually about 120,000 tons of crude oil, 32 million tons
of coal, 160,000 tons of steel, 13,000 tons of non-ferrous metals, 10,000
tons of pyrite and less than 100,000 tons of phosphorus. Over the past 50
years or more, China has evolved a large supply system for energy, mineral
products and other raw and processed materials, with the successful
construction of large petroleum-producing bases such as Daqing, Shengli
and Liaohe; large coal-mining centers such as Datong, Yanzhou,
Pingdingshan, Huainan, Huaibei and Junggar; large iron and steel
production bases such as Shanghai, Anshan, Wuhan and Panzhihua; large
non-ferrous metal refining bases such as Baiyin, Jinchuan, Tongling,
Dexing and Gejiu; and large chemical mining centers such as Kaiyang,
Kunyang and Yunfu. The mushrooming of mining cities has accelerated
urbanization in the country. At present, China’s output and consumption of
mineral products rank among the biggest in the world. In 2002, China had
489 large mines, 1,025 medium-sized ones, and well over 140,000 small ones
and sand and clay quarries, employing a total of 9.07 million people, with
the output value of the mining industry coming to 454.2 billion yuan. It
produced 167 million tons of crude oil and 32.7 billion cu m of natural
gas. The amount of mineral ores, and sand and clay excavated totaled 4.849
billion tons, including 1.38 billion tons of raw coal, 231 million tons of
iron ore, and 23.01 million tons of phosphorus ore; while the output of 10
non-ferrous metals totaled 10.12 million tons. The output of raw coal,
steel, 10 non-ferrous metals and cement ranks first in the world; the
output of phosphorus ore and pyrite ranks second and third, respectively,
and that of crude oil takes the fifth place. The state-owned mining
enterprises form the pillar of mineral resources exploitation in China,
and also the stable supply base for its energy and raw and processed
materials industries. The crude oil, natural gas and 36% of the output of
other mineral ores come from 7,679 state-owned mining enterprises. The
state-owned mining enterprises have not only laid the foundation for
industrial and agricultural development, but also made important
contributions to the improvement of the people’s living standards and the
growth of the comprehensive national strength. Since the mid-1980s, other
types of mining enterprises have also witnessed rapid development. There
are now 140,000 non-state-owned mining enterprises, including 132
established with investment from Hong Kong, Macao and Taiwan businesses,
and 160 with foreign investment.
— The level of mineral resources protection and
rational utilization has been gradually raised. In the past 50-odd years,
China has made great progress in its use of geo-physical exploration,
geo-chemical exploration, remote-sensing, drilling and tunneling
technologies, laboratory test and computer technology for mineral
resources prospecting. It has raised the scientific and technological
level of its mineral resources exploration. Notable results have been
obtained in the multipurpose use and recovery of mineral resources, and
the rate of resources utilization has been gradually increased. At
present, the recovery rate of scrap steel in China is 40%, and the
comprehensive recovery rate of scrap non-ferrous metals is 27.70%.
Supplies of practically all platinum-group and scattered elements have
come from the multipurpose use of mineral resources. Nearly one third of
the raw materials for sulfuric acid are also recovered in the production
of non-ferrous metals. Some of the coal mining enterprises produce the
coal-associated gas, oil shale, kaolin and high-alumina clay for
multipurpose development, and process and utilize coal gangue and flyash,
reaping good economic results and environmental benefits.
— Foreign trade in mineral products has grown fast.
China’s total volume of imports and exports of mineral products, energy
and raw and processed materials came to US$111.1 billion in 2002,
accounting for 18% of China’s total volume of imports and exports. Mineral
products that were imported in large quantities included crude oil, iron
ore, manganese ore, fine copper ore and potash fertilizer. Meanwhile,
China exported large quantities of lead, zinc, tungsten, tin, antimony,
rare earths, magnesite, fluorspar, barite, talc, and graphite, and other
leading mineral products. China’s cooperation with other countries in the
field of mineral resources is expanding constantly. Through prospecting
for offshore oil and gas resources in cooperation with foreign companies,
a number of new oil and gas fields have been discovered, and the offshore
oil and gas output has grown year by year. Prospecting for and
exploitation of oil and gas resources in other countries have reached a
certain scale. Prospecting for and exploitation of hard rock mineral
resources in other countries have also begun. Relations of cooperation in
long-term research and development in the field of coal bed methane have
been established with some countries.
However, there are still some contradictions and
problems in mineral resources survey and development in China.
They are
mainly:
— The contradiction between the fast economic
growth and the huge consumption of some mineral resources. There is a
fairly large gap between the supply and demand in oil, high-grade iron,
high-grade copper, fine-quality bauxite, chromite and sylvite. The degree
of difficulty in looking for mineral resources by geological means in the
eastern regions has increased, and the increase range of proved reserves
there has slowed down. The production in some mines has entered the middle
or late phase, and their reserves and output are decreasing year by
year.
— Serious waste and environmental pollution still
exist in the exploitation and utilization of mineral resources. The
overall arrangements of the mining areas are not satisfactory, and the
prospecting and mining technologies are backward, and there is still
serious waste in the consumption of resources. The protection of the
environment of the mines calls for further improvement.
— Mineral resources exploration and exploitation
are imbalanced between regions. The western regions and the outlying parts
of the central regions abound in resources, but their natural conditions
are poor, their ecological systems are weak, and the work of geological
survey and assessment remains at a low level, thus restricting the
development of the resources.
— The degree of market-oriented exploration and
development of mineral resources is not high. The market-oriented systems
regarding the rights of prospecting for and extracting of minerals should
be further improved. Management of mineral resources should be further
improved and standardized. The scope of international exchange and
cooperation in the field of mineral resources should be further
broadened.
II. Targets and
Principles for Mineral Resources Protection and Rational Utilization
In the first 20 years of the 21st century,
China will build a well-off society in an all-round way, so the total
demand for mineral resources will continue to increase. China will
strengthen its survey, prospecting, exploitation, planning, management,
protection and rational utilization of mineral resources, implement the
strategy of sustainable development, take a new road to industrialization,
and strive to increase the ability of the mineral resources to guarantee
its socio-economic development. China will continue to increase the
economic returns, social benefits and environmental benefits of the
mineral resources to the full by implementing an effective policy
concerning mineral resources in accordance with the requirements of
surveying and exploiting mineral resources in an orderly way and with
compensation, striking a balance between supply and demand, optimizing
composition, and seeking intensive development and high efficiency.
China’s general targets for the protection and
rational utilization of its mineral resources in the early 21st century
are:
— To increase the ability of the mineral resources
to guarantee the building of a well-off society in an all-round way. We
shall raise the effective input into mineral resources prospecting and
exploitation, increase the range and depth of prospecting and
exploitation, strengthen the protection of mineral resources, and increase
their supply. We shall open still wider to the outside world and take an
active part in international cooperation. We shall also establish a
reserve system for strategic resources, lay up necessary reserves of
mineral resources vital to the national economy and the people’s
livelihood, and ensure the safety of the country’s economy as well as the
sustained and safe supply of mineral commodities.
— To promote the improvement of the ecological
environment of the mines. We shall reduce and control pollution and damage
to the environment of the mineral resources caused in the production links
of mining, dressing and smelting or refining and bring about a benign
cycle in the exploitation of mineral resources and protection of the
ecological environment; improve the laws and regulations for environmental
protection in mining areas, and exercise still stricter examination and
supervision over the law enforcement concerning the control of the
ecological environment of the mines; and increase publicity and education
to raise the awareness of the mining enterprises and the whole society
regarding the importance of resources environmental protection.
— To create a development environment for fair
competition. In light of the requirements for establishing a socialist
market economic system and the operation law governing mineral resources
exploration and exploitation, we shall further improve the laws and
regulations concerning the management of mineral resources; adjust and
perfect the policy on mineral resources; improve the investment
environment; provide excellent information service; and create an open,
orderly, sound and unified market environment in which all market subjects
can compete on an equal footing.
To attain the above targets, China will continue to
adhere to the following principles:
— Persisting in the strategy of sustainable
development. We shall implement the measures for protecting resources and
correctly handle the relations between economic development and resources
protection; exploit resources in the course of protection and protect them
in the course of exploitation; strengthen mineral resources prospecting;
exploit mineral resources in a rational way and economize on their
utilization; strive to increase efficiency in the utilization of
resources; and open a new road to industrialization featuring high
sci-tech content, good economic returns, low resources consumption, less
environmental pollution, and full play to the advantages of human
resources.
— Adhering to the orientation of reform toward
establishing a market economic system. Under the guidance of the state
industrial policy and plan, we shall give full play to the basic role of
the market in the allocation of mineral resources, and establish a
mechanism for optimum resources allocation combining government macro
control with market operation. We shall strengthen control over the total
quantity of mineral resources exploitation, foster and standardize the
prospecting and mining rights market, promote the diversification of
mineral resources exploration, exploitation and investment and the
standardization of business operation, and earnestly safeguard the
legitimate rights and interests of the state owners and the holders of
exploration and mining rights.
— Persisting in balanced development between
regional mineral resources prospecting and exploitation and environmental
protection. We shall work out unified plans and correctly handle the
relations between eastern and western regions, between well-developed and
less-developed regions, between prospecting and exploitation, between
state-owned mining enterprises and non-state-owned mining enterprises, and
between scale exploitation and excavation by small mines. We shall further
implement the strategy of large-scale development of the western regions,
accelerate exploration and exploitation of mineral resources in the
western regions, especially the dominant minerals and minerals in short
supply at home, support mining towns and old mines in their search for
substitute resources, and promote the balanced development of regional
economies and the healthy development of mineral resources prospecting and
exploitation. We shall persist in combining mineral resources exploitation
with attention to the interests of the regions inhabited by ethnic
minorities, and strengthen the protection, restoration and control of the
mining environment on the principle of putting prevention first and
combining prevention with control.
— Persisting in widened opening-up and cooperation
with other countries. We shall improve the investment environment,
encourage and attract foreign investors to prospect for and exploit
mineral resources in China. We shall promote international cooperation in
mineral resources, and make such cooperation mutually complementary and
beneficial in accordance with the rules of the WTO and international
convention.
— Persisting in making sci-tech progress and
innovations. We shall implement the strategy of rejuvenating the nation by
reliance on science and technology; strengthen efforts in tackling key
technological problems and popularizing and applying technological
achievements in the investigation and assessment of mineral resources and
their prospecting and exploitation and multipurpose use and in the
prevention and control of environmental pollution in mining areas;
strengthen the R & D of high and new technologies involved in the
development of new energy sources, new material technologies and marine
mineral resources; and improve basic research on new theories, new methods
and new technologies. We shall improve the quality of the workers; train a
contingent of sci-tech personnel with mastery of advanced scientific
theories and the ability to make innovations in mineral resources
prospecting and exploitation; and promote the transformation of the
prospecting and exploitation from a traditional industry to a modern
industry, from a labor-intensive industry to a technology-intensive
industry, and from extensive management to intensive management.
— Persisting in managing mineral resources strictly
according to law. We shall improve the legal system, endeavor to promote
administration according to law, and exercise stricter supervision and
control over mineral resources prospecting and exploitation. We shall
rectify and standardize the rules for mineral resources management, and
strive to advance mineral resources protection and rational utilization
along legal, standardized and scientific lines.
III.
Increasing the Domestic Capability of Mineral Resources
Supply
China relies mainly on the development
of its own mineral resources and other natural resources to develop its
economy. In the course of building a well-off society in an all-round way,
China will first of all increase its domestic capability of mineral
resources supply. China still has big potentials for mineral resources
prospecting and exploitation. It has discovered more than 200,000 mineral
deposits and mineralized formations throughout the country. So far, only
some 20,000 of them have been explored and assessed. Since the 1980s,
72,000 mineralization abnormalities have been discovered, 25,000 of which
have been checked, resulting in the discovery of 217 mineral deposits. The
unchecked ones hold good prospects for mineral findings. The geological
work is still at a low level in the vast western regions and the outlying
zones in the eastern regions and the maritime areas under Chinese
jurisdiction, and there are many unknown areas. All these show the
directions for the work of prospecting for and exploiting domestic mineral
resources in China in the future.
The Chinese government, in accordance with the
requirement for the establishment of the socialist market economic system,
has deepened the reform of the system for mineral resources exploration,
and carried out the public and basic geological surveys and evaluation and
the strategic exploration of mineral resources on the one hand and the
commercial exploration of mineral resources on the other separately. In
1998, China set up the China Geological Survey, which organized a new
round of large-scale survey of the land and resources, and initiated a
basic exploration plan, a mineral resources prospecting and evaluation
project and a resources survey and utilization technological development
project, with the emphasis on the basic geological survey and the
evaluation of the prospects for mineral resources in regions with a low
level of geological work, especially the exploration and evaluation of the
mineral resources potentials in the western regions and the exploration
and evaluation of mineral resources in short supply, so as to provide a
scientific basis for the planning work regarding mineral resources and
administrative decisions by the government, and to furnish basic
geological information regarding mineral resources for commercial
prospecting. The strategic prospecting for mineral resources with
government investment has attracted investment into commercial
prospecting, and a number of areas with prospects of mineralization have
become hot spots for commercial investment.
The Chinese government encourages and gives active
guidance to the commercial prospecting that meets planning requirements,
gears to market demands and focuses on economic results. It encourages
commercial prospecting in central and western regions, remote and border
regions and regions inhabited by ethnic minorities, as well as other
economically less-developed regions with resources potentials. It
encourages mining enterprises to carry out commercial geological
prospecting in the outlying areas or the deeper formations of old mines
with both market and resources potentials, and to find new substitute
resources. It encourages investors to acquire exploration and mining
rights, through fair competition, to sites of mineral deposits founded
after prospecting with government investment. It encourages commercial
prospecting for oil, natural gas, coal gas, coal with low ash and low
sulfur contents, and fine-quality manganese, chromium, copper, aluminum,
gold, silver, nickel, cobalt, metals of the platinum group, and sylvite.
It also encourages the development of geothermal, mineral water and
groundwater resources, in a scientific, economical and rational way, while
encouraging the use of good-quality water for better purposes, and the
prevention and control of pollution.
China will take the following measures to increase
the domestic capability of mineral resources supply:
— Strengthen the exploration and exploitation of
energy mineral resources. China has an abundance of coal resources, and
there will be no major changes in the position of coal as China’s main
energy source in the near future. However, the energy structure with coal
as its main source causes serious air pollution, and some adjustments must
be made to it. China will make full use of its coal and hydro power
resources, and develop cleaning technologies for coal, including coal
washing, dressing, liquefying and gasifying technologies. The scale of
coal production in the eastern regions will be stabilized, stress will be
laid on the development of the coal resources in Shanxi and Shaanxi
provinces and the Inner Mongolia Autonomous Region, the coal resources in
southwest China will be exploited in a rational way, and the coal
resources in Xinjiang, Gansu, Ningxia and Qinghai will be exploited in an
appropriate way. Greater efforts will be made to exploit coal bed methane.
China boasts fairly rich oil resources, which, however, are insufficient
to meet the demand. To solve the problem of insufficient oil and gas
supply, China will first exploit and utilize its domestic oil and natural
gas resources. Abundant petroleum resources have been discovered in the
western regions. The Tarim and Junggar basins in Xinjiang, the Ordos Basin
on the borders of Shaanxi, Gansu, Ningxia, Inner Mongolia and Shanxi, and
the Qadam Basin in Qinghai all show great potentials for development.
Important discoveries have also been made in the Bohai Sea area. In
exploration and exploitation of oil resources, emphasis will be placed on
prospecting work in the old oilfields on the basis of exploiting the
deeper formations in the eastern regions, developing the oilfields in the
western regions and accelerating the exploration of offshore oil and gas
resources; at the same time, efforts will be exerted to make new
discoveries in the new formations and regions to increase the verified oil
reserves and maintain a rational rate of self-sufficiency in oil. In
exploration and exploitation of natural gas resources, emphasis will be
placed on the Tarim, Ordos and Qadam basins, and the Sichuan-Chongqing
region along the west-east gas pipeline, as well as the East China Sea
Basin, to increase the reserves, raise the output and gradually improve
China’s energy structure.
— Strive for a rational distribution of regional
geological exploration and exploitation of mineral resources. The
comparative advantages of the mineral resources in the western regions are
conspicuous, and their distribution is concentrated, thus providing the
resources foundation for the formation of dominant pillar industries. Of
the country’s 158 minerals with proved reserves, 138 are found in the
western regions. The more than 30 minerals found in the western regions,
including coal, oil and gas, sylvite, chromite, rare earths, phosphorus,
nickel, vanadium, manganese, copper, aluminum and zinc, have comparative
resources advantages in the country. With the implementation of the
western development strategy, the accelerated construction of
infrastructure facilities and ecological protection will help to connect
quickly the resources and the resource-related products of the western
regions with the domestic and international markets, thereby greatly
improving the conditions for the exploitation of mineral resources and the
entry of mineral commodities into the market. The Chinese government
encourages the commercial exploration of mineral resources, including oil,
natural gas, coal gas, high-grade coal, copper, gold, high-grade
manganese, sylvite and groundwater in the western regions, with emphasis
on the resource-rich areas, to promote the rational exploitation and deep
processing of oil, natural gas, non-ferrous metals, sylvite, phosphorus
and other mineral resources in the western regions and accelerate the
change from resources advantage to economic advantage. In the central and
eastern regions, emphasis will be placed on tapping the potentials of the
mineral resources, strengthening their multipurpose use and expanding
their processing industrial chain. Exploration of tungsten, tin, antimony,
lead, zinc and rare earth resources will be started in accordance with the
targets of the adjustment of the national industrial structure. Full play
will be given to the advantages of the central and eastern regions in
regional position and technologies in the exploitation of non-metallic
minerals, so as to raise the level of deep processing and the degree of
intensive utilization of non-metallic minerals, open new fields for their
application and increase the market competitiveness of the products. At
the same time, we will start the work of looking for substitute resources
in existing mines in the central and eastern regions. Maritime areas under
Chinese jurisdiction abound in mineral resources. The Chinese government
will continue to strengthen the prospecting and exploitation of oil and
gas resources in these areas and conduct research into other mineral
resources, and take an active part in the international activities of
seabed mineral resources research, prospecting and exploitation.
— Accelerate the structural adjustment of mineral
resources exploitation and utilization. The degree of intensiveness and
modernization of mineral resources exploitation in China is still somewhat
low, and it is necessary to optimize the structure, innovate technologies
and improve management in this regard. China will speed up the structural
adjustment of mineral resources exploitation and utilization, increase
productive capacity and raise efficiency. Through technological
transformation of mining enterprises and improvement of their management
mechanism, the Chinese government encourages the active introduction of
clean production, and the application of mature and high and new
technologies in mineral resources prospecting and exploitation, so as to
raise the level of prospecting and exploitation. We shall introduce scale
exploitation, raise the level of intensiveness and eliminate backward and
scattered mining capacity. Mining enterprises which operate without
licenses, cause environmental pollution, waste resources or do not have
the proper conditions for safe operation shall be closed down in
accordance with the law. Through market and policy guidance, we shall
develop mining enterprise groups with international competitiveness. We
shall continue to support and assist non-state-owned mining enterprises in
their development.
— Raise the level of multipurpose utilization of
mineral resources. Of China’s proved mineral resources, there are fairly
large quantities of low-grade resources which are still difficult of
utilization under the present technological and economic conditions. The
exploitation and utilization of these resources is an important way to
solve the shortage of mineral resources supply. The Chinese government
encourages the accelerated conversion of resources with poor economic
workability into resources of economic workability by strengthening the
construction of the necessary infrastructure facilities in the
resource-rich regions, improving the external conditions for the
construction of mines, using high and new technologies, and reducing the
cost of exploitation. To achieve multipurpose utilization of the country’s
resources is one of China’s important technological and economic policies
on mineral resources prospecting and exploitation. China carries out
comprehensive prospecting, overall evaluation, comprehensive exploitation
and multipurpose utilization of mineral resources. It encourages and
supports mining enterprises to exploit and utilize low-grade refractory
resources, and encourages and supports them to develop and use substitute
or secondary resources to increase the sources of resources supply and
reduce production costs. It encourages mining enterprises to pool efforts
to tackle difficult sci-tech problems and pursue technological
transformation for the multipurpose utilization of the “three wastes”
(waste slag, waste gas and waste liquid). It also encourages the recycling
of scrap metals and secondary resources, as well as the active
exploitation of non-traditional mineral resources. China issued the
“Interim Provisions Concerning Certain Questions on the Multipurpose
Utilization of Resources” in 1985, promulgated the “Opinions on Making
Further Multipurpose Utilization of Resources,” and published the
“Catalogue of Resources for Multipurpose Utilization” in 1996. It has
adopted preferential policies for the multipurpose utilization of mineral
resources in the fields of enterprise income tax and value-added tax, and
it encourages mining enterprises to raise the level of the multipurpose
resources utilization by reliance on scientific and technological progress
and innovations.
— Save energy and reduce consumption. China
encourages the development of technologies for deep-processing of mineral
products, new energy sources and new material technologies as well as
technologies and technical processes that save energy, materials and
water, reduce consumption and raise the efficiency of resources
utilization. We shall develop renewable sources of energy and nuclear
power, increase the use of clean coal and CBM, and reduce the proportion
of coal directly burned. We shall develop new metals, new non-metals and
substitutes for conventional mineral materials and reduce the dependence
of an economic society on conventional mineral materials.
— Establish a system for the reserves of strategic
mineral resources. China will put the major strategic resources in the
reserves order by stages and in groups, on the basis of the present
situation concerning the supply and demand of mineral resources, as well
as its national strength.
— Solve step by step the problem of substitute
resources in old mines. Some of the large and medium-sized state-owned
mines in China have entered their middle or late stages, and have
insufficient substitute resources. Some old mining enterprises can no
longer continue their operations because their resources are exhausted.
The Chinese government will increase its policy support for them by
formulating rational financial and tax policies in line with the
characteristics of mineral resources prospecting and exploitation, to
create good external conditions for their survival and development. We
shall encourage large old mines to look for substitute resources so as to
prolong their service life.
IV.
Widening the Opening of, and Cooperation in, Mineral Resources Exploration
and Exploitation
China will carry out its
policy of opening to the outside world unswervingly. It will take an
active part in international cooperation in the field of mineral resources
to promote the exchange of domestic and foreign resources, capital,
information, technology and markets on the basis of reciprocity and mutual
benefit.
China implements the policy of encouraging foreign
businesses to invest in mineral resources prospecting and exploitation in
the country. China encourages domestic mining enterprises to cooperate
with international mining companies, draw on advanced international
experience, import advanced technology and operate in accordance with
international practices. China began to open its oil industry to the
outside world in 1982 by using foreign capital and technology to prospect
and exploit oil and gas resources. As a result, the range of exploitation
has been extended, and the output of crude oil has risen by big margins.
Now, China has begun to participate in the exploitation of petroleum
resources outside the country. The Chinese government has already taken or
will take a number of new measures to further improve the environment for
foreign investment, widen the opening-up and strengthen international
cooperation.
— Giving further encouragement to foreign
businesses to invest in China. China issued the “Opinions on Further
Encouraging Foreign Investment at Present” in August 1999, the revised
“Directory of Industries for Foreign Investment” in March 2002, and the
“Catalogue of Dominant Industries for Foreign Investment in the Central
and Western Regions” in June 2000. It clearly emphasizes that greater
financial support will be extended to enterprises with foreign investment;
encourages those enterprises to make technical innovations and increase
domestic purchases; encourages foreign investors to invest in the central
and western regions; and further improves the management and services for
enterprises with foreign investment.
— Further improving cooperation with foreign
companies in prospecting and exploiting oil and gas resources. In the
field of oil and gas resources, the Chinese government has always adopted
the pattern of cooperation with foreign companies through one “window”
based on product-sharing contracts, and this has been widely endorsed by
foreign oil companies. China issued the revised “Regulations on the
Exploitation of Offshore Oil Resources in Cooperation with Foreign
Enterprises” and the “Regulations on the Exploitation of Onshore Oil
Resources in Cooperation with Foreign Enterprises” in September
2001.
— Encouraging foreign businesses to make investment
in exploration and exploitation of other mineral resources. China issued
the “Opinions on Further Encouraging Foreign Businesses to Make Investment
in Exploring and Exploiting Mineral Resources Other Than Oil and Gas” in
October 2000, thus further opening the prospecting and mining rights
market to allow foreign businesses to start prospecting ventures with
exclusive capital or in cooperation with Chinese partners, and guarantees
their legal priority rights in exploiting the mineral resources of
workable economic value in the zones explored. The prospecting and mining
rights obtained by foreign businesses with such investment can be
transferred according to law. Foreign businesses which invest in
exploiting and recovering paragenous (associated) minerals, utilizing
tailings, raising the rate of multipurpose utilization and exploration and
exploitation of mineral resources in the western regions shall be entitled
to reduction of or exemption from mineral resources compensation fees
under a preferential policy. Foreign businesses which make exclusive
investment or set up joint ventures or cooperate with Chinese enterprises
in exploiting mineral resources, the exploitation of which is encouraged
in the “Directory of Industries for Foreign Investment,” shall be exempted
from mineral resources compensation fees for five years. It is stipulated
that governments at all levels shall not start joint ventures or enter
into cooperation with foreign investors in running mines, and in no way
should they make irrational economic demands on foreign investors, make
irrational inspections, requisition donations arbitrarily or collect
charges other than those stipulated in the laws and regulations.
— Further improving the environment for investment
in exploring and exploiting domestic mineral resources. The Chinese
government sticks to the protocol on its accession to the WTO and other
relevant commitments by annulling the administrative statutes and
departmental rules incompatible with the WTO rules and gives national
treatment to foreign investors in prospecting and exploitation. The
Central Government shall guarantee the consistent implementation of the
policies, laws and regulations of the state regarding mineral resources
exploration and exploitation in all parts of the country, and standardize
the behavior of governments at all levels in exercising management over
foreign investment in running mines. China has revised the rules for the
management of geological data according to the WTO’s principle of
transparency, broadened the scope of geological data to be released to the
public, and established an open information service system on mineral
resources to ensure the availability of public geological data for foreign
investors. It has clarified, simplified and standardized the approval
procedure for foreign investment in mineral resources prospecting and
exploitation.
— Changing the import mechanism and operation mode.
In the course of taking the new road to industrialization and attracting
foreign investors to make investment in mineral resources prospecting and
exploitation, efforts will be made to shift from laying emphasis on
importing funds only to placing equal emphasis on importing funds,
technology, modern management and people with expertise, from the mere
emphasis on bringing in foreign funds in prospecting and exploitation to
the establishment of joint ventures and cooperation in the development of
services and trade in the mining industry, and from dependence chiefly on
foreign loans and direct foreign investment to the direct use of the
international mining capital market.
China will continue to strive for mutual supplement
with other countries in mineral commodities and promote the development of
foreign trade in mineral products by expanding its international trade in
mineral commodities according to the principle of reciprocity and mutual
benefit. The Chinese government shall formulate a unified policy on the
import and export of mineral products in accordance with the WTO rules and
its commitments on its accession to the WTO, coordinate, in a unified way,
the export of its dominant mineral products and the import of mineral
products in short supply, adjust the import and export mix of mineral
products, improve the economic results, and encourage the export of
deep-processed mineral products with high added value and the import of
primary mineral products. Direct import of mineral products will remain
the chief way by which China utilizes foreign mineral resources for a
fairly long time to come. The Chinese government shall gradually change
the situation in which the proportion of the spot trade in mineral
commodities, including crude oil, is too big at present, encourage the
signing of long-term supply contracts with foreign companies, and import
minerals from diversified sources. With regard to mineral resources in
which China has advantages, such as tungsten, tin, antimony, rare earths,
fluorspar and barite, the government will improve the export structure,
increase the added value of the export products, standardize the order of
export business, and actively urge the trade intermediary organizations to
improve trade coordination and self-discipline, and promote the healthy
development of the trade in domestic and foreign mineral products.
The Chinese government encourages domestic
enterprises to take part in international cooperation in the sphere of
mineral resources, and in exploration, exploitation and utilization of
foreign mineral resources. It will promote and protect investments in
mineral resources prospecting and exploitation outside China, and
standardize the investment and business operation behavior in accordance
with international practices. It will actively develop cooperation with
foreign companies in geological survey and mineral resources prospecting
and exploitation, and promote bilateral and multilateral exchanges and
cooperation in the relevant scientific and technological
fields.
V.
Achieving the Coordinated Development of Mineral Resources Exploitation
and Environmental Protection
Mineral resources
prospecting and exploitation will change and affect the ecological
environment around the mining areas. The Chinese government attaches great
importance to environmental protection and the prevention and control of
pollution in the course of exploiting and utilizing mineral resources, and
strives for simultaneous development in mineral resources exploitation and
environmental protection and pollution control. Environmental protection,
pollution control and land rehabilitation in mining areas are explicitly
stipulated in laws and regulations China has published and implemented.
The Chinese government will continue to improve environmental protection
in mining areas, and strengthen the work in the following aspects:
— Continuing to adhere to the principle of placing equal stress on the
exploitation and utilization of mineral resources and the protection of
the ecological environment, by putting prevention first and combining
prevention with control. We shall strictly adhere to the system of
environmental impact evaluation reporting, the system of land
rehabilitation and the system of collecting fees for pollutant discharge
in mining areas. We shall strictly adhere to the system whereby the
construction of mines goes hand in hand with the designing, constructing
and commissioning of environmental protection facilities. Active guidance
will be given to enterprises in organizing clean and safe production in
the course of mineral resources prospecting and exploitation.
— Restricting the exploitation of mineral resources that produce
considerable negative impacts on the ecological environment. Strict
control will be enforced on prospecting and exploitation in national
conservation and other areas where the ecological conditions are weak.
Mineral resources exploitation is forbidden in national conservation,
important scenic areas and important geological protection areas, and
mineral resources exploitation in ecological protection areas is strictly
restricted. We shall strictly prohibit coking, metal refining and
smelting, sulfur and vanadium refineries with indigenous methods. We shall
restrict the building or rebuilding of mines producing coal with a sulfur
content exceeding 1.5%, and prohibit the building of mines producing coal
with a sulfur content exceeding 3%. We shall restrict the exploitation of
mineral resources in areas liable to geological disasters, and prohibit
the exploitation of mineral resources in areas with real danger from
geological disasters. Unauthorized exploitation of mineral resources
within a given distance on both sides of railway lines and major highways
is forbidden.
— Evaluating the impact on the ecological environment before starting a
new mineral resources exploitation project. Measures shall be taken to
protect the ecological environment, avoid or reduce adverse effects or
damage caused to the air, water, farmland, grasslands, forests and seas. A
program for the exploitation and utilization of mineral resources shall
include a plan for the protection of water and soil, a plan for land
rehabilitation, a plan for the prevention and control of geological
disasters in mining areas and an evaluation report on geological
environmental impacts. These documents shall be submitted for approval as
stipulated. We shall exercise stricter supervision and management over the
control of the “three wastes” in mines, and strictly control the discharge
of waste gas in accordance with the criteria stipulated by the state. We
shall strengthen the control of poisonous and harmful waste water and
other pollutants produced in mines, and offenders shall be severely dealt
with.
— Strengthening the investigation and monitoring of the environment and
the prevention and control of disasters in mining areas. The government
shall organize nationwide investigations and evaluations of the ecological
environment in mining areas. Mining enterprises shall strengthen
investigation, monitoring, forecasting and early warning of disasters
possibly induced in the course of the development of mines, promptly take
effective measures to prevent and control them, and submit monitoring
reports to the competent departments of the local governments. An
information network shall be established and emergency anti-disaster plans
shall be worked out to prevent sudden disasters at the maximum.
— Setting up a multi-source investment mechanism for environmental
protection in mining areas. We shall establish an agreement-honoring
system for environmental protection and land rehabilitation in mining
areas, and adopt government guidance and market operation to ensure the
effective restoration and improvement of the environment there. With
regard to abandoned mines and old mines, the state will strengthen the
restoration and improvement of the ecological environment on the basis of
demonstration projects, and encourage investment in this regard from
society at large. We shall set up an investment mechanism for
environmental control in mines still in production, with the mining
enterprises playing the leading role. The enterprises shall provide the
funds for environmental protection in new mines.
VI. Improving the Management of
Mineral Resources
In the past five decades and more
since the founding of the People’s Republic, China has gradually improved
the management of its mineral resources, putting it on legal, standardized
and scientific tracks.
— Enacting and gradually improving the laws and regulations on mineral
resources management. China has put in place a legal system for its
mineral resources, consisting of the “Mineral Resources Law” and other
relevant laws and regulations, with the Constitution as its foundation.
Since 1982, China has successively promulgated the “Mineral Resources
Law,” “Land Administration Law,” “Coal Law,” “Law on Safety in Mines,”
“Environmental Protection Law,” “Marine Environmental Protection Law” and
“Law on the Use and Management of Sea Areas.” The Chinese government has
also issued more than 20 supplementary statutes and regulations, including
the “Detailed Rules for the Implementation of the Mineral Resources Law,”
“Regulations on the Exploitation of Offshore Oil Resources in Cooperation
with Foreign Enterprises,” “Regulations on the Exploitation of Onshore Oil
Resources by Foreign Enterprises,” “Measures Governing the Registration
and Management of Areas for Surveying Mineral Resources,” “Measures
Governing the Registration and Management of Mineral Resources
Exploitation,” “Measures Governing Administration of the Transfer of
Prospecting and Mining Rights,” “Provisions on the Administration of the
Collection of Mineral Resources Compensation Fees,” “Interim Measures on
the Supervision and Control of Mineral Resources,” and “Regulations on the
Management of Geological Data.” The various provinces, autonomous regions
and municipalities directly under the Central Government have, in
addition, formulated relevant local statutes. These laws and regulations
have put in place China’s basic legal system for the management of its
mineral resources, and provided the legal guarantee for exercising
administration, managing mineral resources and operating mines according
to law.
— Deepening the reform of the mineral resources management system. To
constantly meet the requirements for economic restructuring, China has
reformed the mineral resources management system, changed and strengthened
government functions, and separated government functions from enterprise
and institution management. From 1950 to 1981, the former Ministry of
Geology and other relevant industrial administration departments exercised
management over the country’s mineral resources. The geological
departments chiefly performed the functions of organizing nationwide
geological survey and prospecting, managing the reserves of mineral
resources and controlling the collection and exchange of geological data,
while the relevant industrial administration departments were responsible
for the management of mineral resources exploitation. In 1982, the
Ministry of Geology changed its name to the Ministry of Geology and
Mineral Resources, and became responsible for the supervision and
management of mineral resources exploitation as well as the industrial
management of geological survey and prospecting. When the government was
reorganized in 1988 and 1993, it made further clear the four basic
functions of the Ministry of Geology and Mineral Resources — exercising
comprehensive management of mineral resources, exercising industrial
management of geological survey and prospecting, exercising supervision
and management of the rational exploitation, utilization and protection of
mineral resources, and exercising management of the monitoring, evaluation
and supervision work regarding the geological environment. The National
Mineral Resources Commission was established in January 1996 to strengthen
the centralized management function of the Central Government over mineral
resources and safeguard the rights and interests of the state as the owner
of the country’s mineral resources. The government was restructured again
in 1998, and the functions of mineral resources management belonging to
the State Planning Commission and the coal and metallurgical industrial
departments were transferred to the Ministry of Land and Resources, to
achieve the centralized management of mineral resources of the whole
country. At present, over 90% of the country’s prefectures and cities, and
more than 80% of the counties have set up land and mineral resources
administration organs.
— Strengthening the management of mineral resources planning. The plan
regarding mineral resources is the guiding document for the survey,
exploitation and utilization of the country’s mineral resources and the
basis for exercising macro control. The Chinese government is further
strengthening mineral resources planning, improving the planning system,
fixing strict planning responsibility, check-up, announcement, revision
and compilation and supervision systems, strengthening publicity work
concerning the plans, and setting up a system for ensuring the
implementation of the plans and information feedbacks, to guarantee the
fulfillment of the planned targets.
— Reforming the management system for mineral resources prospecting and
mining rights. The Constitution and the “Mineral Resources Law” of China
explicitly state that “mineral resources are owned by the state.” The
State Council exercises the state ownership of the mineral resources. At
the same time, China has reformed the management system for mineral
resources prospecting and mining rights, clearly defined the property
right attribute of the prospecting and mining rights, and established the
system of acquisition of the prospecting and mining rights with
compensation and the transfer of them according to law. China has
established a legal system whereby the holder of the prospecting right
enjoys priority in acquiring the mining right in the area explored, and
strengthened the exclusiveness of the prospecting and mining rights. It
has changed the limits of authority regarding giving approval to mineral
resources prospecting and exploitation and issuing the prospecting and
mining licenses. The prospecting and mining rights can be obtained with
compensation by such means as competition through bidding, auction and
listing. The transfer of prospecting or mining rights shall follow the
market rules, be subject to approval from government departments, and go
through the procedure for transfer according to law. The Chinese
government will continue to cultivate and standardize the prospecting and
mining rights market, and exercise stricter supervision and control over
the operation of the market in accordance with the requirements of clearly
defined ownership, complete rules, effective regulation and control, and
standard operation.
— Improving the system of compensation for the use of mineral
resources. China’s “Mineral Resources Law” clearly provides for the system
of compensation for the use of mineral resources. The Chinese government
started levying compensation fees for mineral resources from the holders
of mining rights in 1994, thus terminating the history of
compensation-free mining in China. The collection of the compensation fees
for mineral resources (fees for the use of mining areas in cooperative
development of petroleum resources offshore or onshore) embodies the
rights and interests of the state as the owner of the mineral resources,
and is conducive to establishing an economic incentive mechanism to
promote the protection and rational utilization of mineral resources. The
compensation fees for mineral resources collected by the Chinese
government are included in the state budget; they are specially managed
and used chiefly in mineral resources prospecting. Holders of mining
rights who conform to the stipulations of the laws and statutes shall have
their compensation fees remitted or reduced. The Chinese government has
stipulated that, beginning in 1998, it will collect fees for the use of
prospecting and mining rights, and the costs for the prospecting and
mining rights formed in the course of prospecting with state investment
from the holders of the prospecting and mining rights. Fees and costs for
the use of prospecting and mining rights shall be remitted or reduced for
mineral resources exploration and exploitation, which meet the
requirements, in the western regions, regions inhabited by ethnic
minorities, remote and poor regions designated by the government, and
offshore areas.
— Rectifying and standardizing the order of mineral resources
management. Good order in the mineral resources management is a
prerequisite for the protection and rational utilization of mineral
resources. Since the “Mineral Resources Law” was promulgated in 1986,
Chinese legislative organs have organized examinations on law enforcement
on many occasions. Since 1995, the Chinese government has rectified the
order of mineral resources management on a large scale throughout the
country, resulting in some improvement in the order of mineral resources
management. The Chinese government will continue to intensify supervision
over the enforcement of the law, rectify and standardize the order of
mineral resources management, strengthen supervision over production
safety, safeguard the rights and interests of the state as the owner of
mineral resources and the legitimate rights and interests of the holders
of prospecting and mining rights.
— Improving the services of the government departments. It is necessary
to improve the style of service and make the appropriate administrative
affairs known in accordance with the requirements of being open,
transparent, standardized and highly efficient. Mineral resources
administrative departments at all levels shall announce to the general
public on their work system, matters for approval, important documents,
standards and time limits, and subject themselves to public supervision.
They shall establish systems for internal joint hearings, handling
procedures or documents at windows, and ascertaining administrative
responsibilities. They shall establish a communiqué system, release
information on the mineral reserves and the progress in mineral resources
exploration and exploitation, and gradually make the geological data and
information known to the general public. They shall establish a system for
access to information so that the general public can promptly inquire
about the state plan, policies, laws and statutes concerning mineral
resources, and criteria for the classification of the reserves of the
resources, seek information on the registration of prospected areas, on
registration of exploitation, and rates of compensation fees for mineral
resources and ways of payment. At the same time, they shall make great
efforts to apply information technology, raise their work efficiency and
improve their services.
China is a developing country with a large population and a relative
shortage of resources. China will continue to deepen the reform, widen the
opening-up, develop the socialist market economy unswervingly, take the
road of sustainable development, and rationally use and protect its
resources. China will, as usual, take an active part in international
cooperation for the development of resources and environment protection,
and join hands with all other countries in the world in advancing boldly
to achieve the sustainable development of human society.
Information Office of the State
Council
of the People's Republic of
China
December
2003, Beijing
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