MAC/20: Mines and Communities

China update

Published by MAC on 2007-05-18


China update

18th May 2007

A UN "clean" energy project is purportedly advancing in rural China, although the evidence is currently limited to only a few sites, while private sector backing for such schemes is said to be advancing further than in the United States.

On May 15th, Chinalco (aka Chalco), China's largest integrated aluminium producer, entered a joint venture with London-listed Aricom plc, to construct a 30,000-tonnes per year titanium-sponge facility in Heilongjiang. The source will be ilmenite (mineral sands) deposits at Aricom's mines across the border in eastern Russia.

The planned output would equal the country's current titanium sponge capacity, although domestic consumption is currently only two-thirds of this. Yet - just the day before - a China Nonferrous Metals Industry Association official told Interfax news service that: "The rapid growth in investment in China's titanium sponge smelting industry over recent years [represents] as blind expansion [which] will lead to resource waste, unhealthy competition and pollution, and cause China to become a global low-price titanium sponge supplier."

Could this be yet another example of corporate practice outstripping, and indeed contradicting, emergent government policies aimed at "cooling" the economy?

The Metallurgical Mines Association of China has urged domestic iron and steel producers to forage further abroad, even as it publishes a list of current and planned mine projects which show impressive (or to some, disturbing) success in Chinese companies gaining critical resources in Peru, Brazil, Vietnam, Russia (the Chita autonmous region) and, above all, in Australia.

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