MAC: Mines and Communities

What's China been up to in the mining world?

Published by MAC on 2011-04-12
Source: People's Daily

News Summary February-March 2011

The articles published below cover several important recent developments relating to mineral ventures in and outside China - the world's largest consumer of mined materials:

  • Chinese uranium mining commences in Niger
  • China begins forays into seabed mining
  • A 3-year moratorium is paced on new coal exploration permits
  • Coal mine deaths officially fall - but more than 6 workers still die daily
  • A Chinese miner is the first to benefit under new Fiji land law
  • 10% of Chinese rice may be poisoned by cadmium, say researchers

Production starts at China's first overseas uranium mine

People's Daily

24 March 2011

China National Nuclear Corp (CNNC), the country's largest nuclear plant operator, has started trial production at its first overseas uranium mine. The move comes as China increases efforts to secure more of the metal used in nuclear power production, from overseas acquisitions.

The Azelik mine in Niger, 37.2 percent owned by CNNC, will be capable of producing 700 tons of uranium annually when it begins full operations.

The operator said earlier that it would increase annual overseas uranium capacity to 5,000 tons within 10 years to secure supplies.

Apart from Niger, CNNC is also looking for uranium mining resources in Russia, Zimbabwe, Australia, Kazakhstan, Tanzania and Zambia.

China imported 17,136 tons of uranium in 2010, more than three times the total in 2009, according to the General Administration of Customs.

Two reactors will come online in 2011, adding about 120 tons in uranium demand, said Xiao Xinjian, an expert at China's Energy Research Institute. Demand for uranium will continue to rise this year, said Xiao. Nuclear capacity may total 11.7 gigawatts (gW) by the end of 2011, according to the National Energy Administration.

China has put on hold new approvals for nuclear power projects in the wake of the crisis at the Fukushima Daiichi power plant in Japan. Even with that brake, the country's nuclear capacity is still likely to reach 40 gW by 2015 as 28 reactors are currently under construction, the largest number in the world, and indicates that demand for uranium will continue to rise.

"We must guarantee our domestic production capacity, which will constitute the major part of our supply," Sun Qin, president of CNNC, said earlier in an interview with the People's Daily Online.

China could be self-sufficient in uranium supplies by 2020 when the country's nuclear capacity is scheduled to reach 40 gW, according to estimates by industry experts. "Domestic reserves and capacity, in addition to international purchases will assure the short-term supply (by 2020)," Sun said.

China Uranium Corp, a unit of CNNC, plans to increase output to between 4,000 and 5,000 tons by 2020, the company said last year.

Chinese nuclear power operators are sticking to the "Three One-Third" formula - one third from domestic supply, one third from overseas acquisitions and another third from direct international purchases - to ensure a stable supply in the long term.

Another leading nuclear power developer, China Guangdong Nuclear Power Holding Corp, made a $1.2 billion bid for Kalahari Minerals Plc earlier this month, which could give the company access to one of the largest uranium deposits in Namibia.

Minmetals to plunge into deep-sea mining

By Zhang Qi

China Daily

17 March 2011

China Minmetals, the country's largest metals trader, said it has carried out research and development (R&D) work into deep-sea mining exploration and exploitation, a move designed to meet the country's growing demand for minerals and metals.

Changsha Research Institute of Mining and Metallurgy, a subsidiary of Minmetals as well as a key national laboratory in the development and utilization of deep-sea resources, has stepped up research in underwater mining for manganese nodules, multimetal sulphides and cobalt-rich manganese crusts, Zhou Zhongshu, president of Minmetals, told China Daily.

"China relies heavily on costly raw-material imports, and this will push the country to go for deep-sea mining to explore metals including copper, nickel, sliver and gold," he said.

"It will be profitable if we can sell deep-sea exploited raw ores priced at more than $80 per ton," he said.

Deep-sea mining takes place about 1,400 to 3,700 meters under the ocean's surface, creating sulfide deposits, containing precious metals such as silver, gold, copper, manganese, cobalt, and zinc.

The Canadian company Nautilus Minerals Inc suggests the deep ocean produces several billion tons of metals each year, including vast amounts of copper.

China filed the first application to the International Seabed Authority (ISA) for deep-sea mining in the Indian Ocean in May 2010, and it is awaiting approval.

But the country still lags behind international rivals. Nautilus Minerals and Australia's Bluewater Metals have already kicked off exploration of underwater mountain ranges in the South Pacific. Nautilus plans to start full-scale operations in 2012.

Zhou from Minmetals said the country should establish a trial ocean economic zone at home and also develop ocean mining exploration overseas.

China is focusing on exploration and exploitation of the deep sea to obtain more minerals and oils to meet the demands of a high-growth economy.

Liu Baohua, a geophysicist at China's State Oceanic Administration, said at an earlier conference that China will increase funding for R&D in deep-sea technology and list the target in the 12th Five-Year Plan (2011-2015).

Although the country hasn't started operations in deep-sea mining, it has already made progress in deepwater oil production.

China National Offshore Oil Corp, the country's largest offshore oil company, said that it will step up exploration in the South China Sea this year and plans to raise deep-sea oil production to 10 percent of global production.

Oversupply fears prompt ministry to stop issuing coal exploration permits

By Zhang Han

Global Times

28 February 2011

The Ministry of Land and Resources (MLR) will suspend the issuance of coal exploration permits for three years in a bid to reduce oversupply in the industry, an official said Sunday.

Liu Lianhe, director of the Minerals Exploration Department of the MLR told China National Radio Sunday that the move was aimed at ensuring the sustainable development of the country's coal industry.

"The coal mining exploration permits that we have issued so far amounts to a supply of 3.8 billion tons of coal a year, far exceeding the current demand for coal in the market," Liu said. "Therefore, we are temporarily suspending the issuing of exploration permits for newly discovered mines, whose supply reaches 600 million tons."

Liu said that there are currently more than 2,000 coal exploration permits covering coal reserves of over 500 billion tons. "If all the companies explore coal to their full capacity, there would be a severe oversupply, which would have a severe impact on the sustainable development of the industry," said Liu.

Liu's call reiterates an MLR circular issued on February 10 calling for a stop to new coalmines.

Only "key coalmine projects" approved by the State Council and those that have been granted special exploration funds and are approved by the MLR may seek exploration rights.

The MLR stopped issuing coal exploration permits between February 2, 2007 and December 31, 2008. The moratorium was then lifted until March 2009, when the MLR again suspended the issuance of permits.

The China Energy News reported that 400 million tons went unused last year.

However, Lin Boqiang, director of the China Center for Energy Economic Research at Xiamen University, told the Global Times Sunday that actual production might have been much less than forecast, thus leading to shortages.

"The imbalance of resources in different regions and the inefficient transportation of coal might also have contributed to the shortage," Lin said.

Coal mine deaths fall ‘but still remain high'

China Daily

26 February 2011

Colliery fatalities have dropped for the fifth consecutive year, though the death toll remains high in the world's largest coal producer, according to a leading work safety official.

Spokesman and chief engineer for the State Administration of Work Safety, Huang Yi, said in a news conference by the State Council's information office on Friday that 2,433 people died in coal mine accidents in China last year, 198 fewer than in 2009.

The figure represents an average daily death toll of more than six people.

However, the declining death toll, a 7.5-percent drop, highlights improving underground conditions amid an upgrade in safety and management, he said.

Coal mine deaths fall ‘but still remain high'

The number of coal mine accidents in 2010 also declined 13.2 percent year-on-year, the spokesman said.

According to earlier Xinhua reports, citing safety and mine officials, 4,746 people died in mine accidents in 2006; 3,786 in 2007; 3,214 in 2008 and 2,631 in 2009.

Huang said his administration closed 21,200 illegal coal mines and slashed the number of small-scale mining operations from 18,145 to 9,042 over the past five years.

The administration also oversaw a major reduction of gas levels in the mines, he said.

Moreover, Huang added, the administration will issue standards for the use of facilities in shelters, which must be built in all mines over the next three years.

"The fatality rate per million tons of coal produced decreased 73 percent in the past five years and it will further fall 28 percent over the next five years," Huang said.

Huang told China Daily the administration set the compulsory target because coal mine safety remains "the priority of priorities".

He added China can meet safety targets and "the achievement will lay a critical foundation for China to turn around its work-safety status by 2020, when safety levels will equal that of moderately developed countries".

However, Huang said challenges remain. The safety culture has not taken root and many mines ignore or pay little attention to it, he said.

China's total coal production has risen from 2.1 billion tons in 2005 to 3.2 billion tons in 2010, when it reached 45 percent of the world's total output, Director of the National Development and Reform Commission Zhang Ping said in January.

High fatality rates have plagued the industry.

Deaths per million tons of coal extracted are 30 to 50 times that of developed countries, Fang Junshi, head of the National Energy Administration's coal department said in September 2009.

Some critics even suspect the credibility of the fatality statistics, alleging lax regulation, corruption and officials' liability for accidents often result in underreporting of deaths.

After a mine explosion in Mianchi county, Henan province, in December 2010, police investigations found four bodies were deliberately hidden in the mine and seven suspects colluded to underreport nine other bodies.

The administration also vowed that one of its key tasks in 2011 is to tighten investigation procedures and severely punish those who cover up accidents, lie or delay their reports.

A total of 79,552 people died in 363,383 accidents in the country last year.

The number of fatalities was 4.4 percent down on 2009 figures and the accident rate was 4.2 percent lower, the administration reported.

By Wang Huazhong

Chinese firm to start bauxite mining in Fiji


25 February 2011

Fiji's Minister for Lands and Mineral Resources Netani Sukanaivalu on Friday issued a land lease to a Chinese mining company to explore bauxite in Nawailevu in northern Bua province.

Sukanaivalu handed over the lease documents to Executive Director of Aurum Exploration Limited, Simon Chen Bao, in a ceremony in Nawailevu that was witnessed by local villagers.

Chen Bao said he hoped the company and villagers with the support of the Fiji government would work together for the common good.

As the first company to mine bauxite in Fiji, Aurum Exploration Ltd now has legal control over the 165 acres of land which will be used for mining. The land belongs to two landowning units of Naicobo and Noro.

The occasion of the lease issuance is historic in Fiji as it's the first set of leases issued under the Land Use Decree 2010 and the Land Use Regulations 2011.

"Government's land reform initiative is also meant to address some long standing issues which include but are not limited to the need to ensure that landowners get fair returns for the use of their land and tenants get security of tenure," Sukanaivalu said.
Editor: Wang Guanqun

Heavy Metals Tainting China's Rice Bowls

By staff reporter Gong Jing


13 February 2011

Researchers say cadmium and other sewage toxins have poisoned large amounts of a Chinese staple

As much as 10 percent of China's rice may be tainted by poisonous cadmium, a heavy metal discharged in mine and industrial sewage that makes its way into rice paddies, according to agricultural researchers at a major university.

Much of this poisoned rice is consumed by farm families or sold in areas of the nation's food market beyond the reach of government safety regulators.

Following the lead of research conducted by scientists at Nanjing Agricultural University's agricultural resource and environment institute, a Caixin probe found several dozen farmers in the village of Sidi in southern China's Guangxi Autonomous Region have been troubled by a strange weakness of the legs for decades.

Health officials have declined to link the feeble leg condition to pollution, but similar conditions have been found among farmers in Zhejiang Province that the Nanjing scientists blamed on high levels of cadmium in the rice local families eat almost daily.

Rice is a staple food for 65 percent of the population in China, where annual rice farm output is about 200 million tons.

Sidi's rice paddies have been polluted by sewage from a nearby lead and zinc mine.

The Nanjing researchers, led by farm scientist Pan Genxing, took 91 samples from markets in six regions nationwide in 2007 and found elevated cadmium levels in 10 percent of the commercially sold rice.

The research attracted little attention after its publication three years ago. Pan's team followed up with another survey in 2008 focusing on several southern provinces.

They found 63 samples from markets in Jiangxi, Hunan and Guangdong provinces contained elevated cadmium levels in 60 percent of the rice, suggesting the problem is far more serious in the south than northern China.

Chen Tongbin, a research fellow at the China Academy of Sciences specializing in soil pollution and remediation, estimates heavy metals have polluted 10 percent of China's farmland. Leading the list of poisons are cadmium and arsenic.

To date, none of China's hospitals have officially recognized the weak leg condition common in some communities. But agriculture scientists have reluctantly called the phenomenon an early symptom of itai-itai disease, the name given to cadmium poisoning suffered by many in Japan after an environmental disaster in the 1970s that led to severe spine and joint pain, as well as brittle bones.

Some Chinese farmers are aware that eating the tainted rice they grow can make them sick, but they can't afford the cleaner rice sold in markets.

Many other farm families have been kept in the dark about the heavy metal hazards due to a void in government regulations in plantation and a lack of information about pollution risks, so they continue eating toxic rice. Caixin's investigation found some of this contaminated rice enters local commercial markets as well.

Chinese investment soars in Brazil: report


30 March 2011

BRASILIA - China is rapidly expanding its presence in Brazil, surpassing the United States as the South American giant's biggest biggest investor and trade partner, a report released Wednesday said.

Published ahead of a planned visit by Brazilian President Dilma Rousseff to China next month, the report said Chinese firms have announced investments of nearly $30 billion in Brazil, including $8.6 billion currently under negotiation.

The energy and mining sectors represented 90 percent of those investments, the report by the Brazil-China Business Council said.

But Chinese investors have also made direct or indirect purchases of Brazilian farm lands, especially for soy production.

China is seeking "a base for supplies of natural resources," the study said.

Brazilian exports to China have also climbed rapidly, jumping from $1 billion in 2000 to $30.7 billion last year.

These exports -- mostly in soybeans, iron ore, oil and other commodities -- helped Brazil secure an estimated $5 billion annual trade surplus with China.

Most Brazilian imports from China are manufactured products, which soared from $1.2 billion in 2000 to $25.5 billion in 2010.

The growth has been so explosive that China replaced the United States in 2009 as Brazil's biggest trade partner. From 2009 to 2010, bilateral trade increased by 52 percent.

But "until 2009, Brazil had more investments in China than China in Brazil," noted Norton Rapesta, who heads trade promotion at the Brazilian Foreign Ministry.

"Latin America is the last frontier attracting great interest from China, and Brazil is the engine of that dynamic," said Edileuza Reis, Brazil's undersecretary-general for Asian affairs at the Foreign Ministry.

Brazil hopes this economic expansion will also yield tangible benefits for the Latin American nation.

When Rousseff visits China April 10-15, she will seek a greater presence for Brazilian firms in China, secure more Chinese investment in developing Brazilian industries and reduce Chinese purchases of raw materials, as well as the diversification of Chinese exports.

"We want to include more high value-added products in trade with China, but we also need to diversify our investment in China," said Reis.

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