NEWS

Opportunities and difficulties coexist in Sino-Mongolian mining cooperation

Source: www.chinamining.org         Citation: chinadaily.com.cn        Date: October 28, 2015

China and Mongolia reached eight cooperation agreements on mineral exploration ,worth over 30 million yuan ($4.73 million), at the first China-Mongolia Expo in Hohhot, Inner Mongolia autonomous region.

The meeting on mineral resources exploration is held at the first China-Mongolia Expo on Oct 24 in Hohhot, Inner Mongolia autonomous region. [Photo/nmg.gov.cn]

For instance, Inner Mongolia Mining Group signed an overall plan on joint exploration of non-ferrous metal and unconventional gas with a Mongolian mining company.

The two groups will increase cooperation in mineral prospecting, mining, and infrastructure construction, according to Hao Shen, deputy director-general of Inner Mongolia Mining Group.

Chinese and Mongolian mining industries stepped up cooperation in recent years thanks to support from top authorities on both sides.

The joint declaration on establishing a comprehensive strategic partnership signed by Chinese and Mongolian heads in August 2014 mapped out cooperation in mineral exploration, infrastructure construction and financial cooperation. The cooperation mechanisms of both countries are being improved. A mineral resources and energy cooperation committee was established, said Peng Qiming, chief-engineer of the Ministry of Land and Resources.

Peng Qiming, chief-engineer of the Ministry of Land and Resources speaks at the meetingon Oct 24. [Photo/nmg.gov.cn]

In 2014, Sino-Mongolian trade volume totaled $7.3 billion, with mineral and livestock products the main exports from Mongolia.

However, mining cooperation is held back by the current international economic environment, infrastructure conditions and business costs.

Wang Bo, vice-chairman of Inner Mongolia addresses to the meeting. [Photo/nmg.gov.cn]

China and Mongolia set high value on mining as a driver for economic development. Pushing reforms, innovation, sustainable development and cooperation is a concern shared by both countries, said chief-engineer Peng.

About CHINA MINING

Since first held in 1999, the scope and influence of CHINA MINING has grown rapidly year by year. As a global mining summit forum and exhibition, CHINA MINING Congress and Expo has become one of the world’s top mining events, and one of the world’s largest mining exploration, development and trading platforms, covering all aspects of the whole mining industry chain, including geological survey, exploration and development, mining rights trading, mining investment and financing, smelting and processing, mining techniques and equipment, mining services, etc. playing an active promotion role in creating exchange opportunities and enhancing mutual cooperation between domestic and foreign mining enterprises.

CHINA MINING Congress and Expo 2016 will be held at Meijiang Convention and Exhibition Center in Tianjin on September 24^th-27^th, 2016. We invite you to join the event and to celebrate the 18^th anniversary of CHINA MINING with us.  For more information about CHINA MINING 2016, please visit: www.chinaminingtj.org.

Mining rights policies and regulations under New Normal

—Q&A seminar by relevant departments from MLR

Source: www.mir.gov.cn    Citation: www.agkyb.com   Date: October 28, 2015

The CHINA MINING Congress and Expo 2015 held the session on special topic of “Interpretation of Mining Right Policies”. The relevant heads of Department of Mineral Development and Management, Department of Mineral Resources Reserves, Strategic Research Center of Oil and Gas Resources and Department of Cultivated Land Protection (all the above department are under Ministry of Land Resources, PRC)focused on the interpretation of new policies and new requirements of mining right management issued by Ministry of Land and Resources,PRC and promoted newly-issued measures of mining right management for the public convenience. The session also conducted interactive activities with mining right people and investors, and the heads of related departments on the spot gave answers to inquiries of the policies problems.

Q: Fluorite mine previously was the mineral with total production control. Are there any latest regulations or development trend on current fluorite mine?

Mr. Yao Huajun, Director-General of Department of Mineral Development and Management under MLR: MRL issued the “Notice on Control Index of Total Production of Highly-alumina Clay Minerals Fluorite Mine” in 2010 and firstly implemented the control management on total production of fluorite mine. The control at that year targeted at a total production of fluorite mine with 11 million tons (ore production), and now there is no longer for the implementation of total production control on fluorite mine. With regard to protective mining policy, it will be taken into consideration with our industry policy for establishment of a dynamic adjustment mechanism on a pilot basis in the future to gradually improve the examination and approval proceedings of protective mining minerals. The State Council also retained the examination and approval of protective mining minerals as an internal item in government during this approval system reform, and it is surely a hot issue. There actually are some relevant regulations on fluorite mine in other industry, but it is not the protective mining mineral any more. With the accelerating social process of post-industrialization, non-metallic minerals play an increasingly important role and Ministry of Land and Resources will also organize experts to have discussions on establishment of a dynamic adjustment involving more mineral types than fluorite mine.

Q: We faced relatively great confusion in running fluorite mine in the past and it was difficult to exactly grasp the establishment of mining right and exploration right and the regulations relevant to production quota. Please give a detail on the establishment of mining right and exploration right, and whether the relevant quota policies are similar to other minerals? Is there any special?

Mr. Bo Zhiping, Deputy Director-General of Department of Mineral Development and Management under MLR: The control management on total production of fluorite mine has been released currently. This control management has its origins at the year of 2009. Then, the economies including EU, the United State and Japan launched the proceedings against 13 raw materials in China under the framework of WTO. We chose two minerals including the fluorite mine in response to this lawsuit and started to manage total production control since 2010. China lost this lawsuit and lifted total production control.

Q: My question pertains to the policy of shale gas. If there is a requirement for drilling only a parameter well of shale gas, does it need to approved by Ministry of Land and Resources? Since there is a clear permission restriction to shale gas exploration and exploitation, what qualifications are required to the unit for application of drilling a parameter well of shale gas?

Mr. Zhao Xianliang, Director of Strategic Research Center of Oil and Gas Resources under MLR: We firstly have to be clear on a concept. Only the corresponding qualifications are required for a unit to obtain the exploration right or mining right. At present, Ministry of Land and Resources is considering setting free to the qualifications for exploration right of shale gas. The first round of bidding for exploration right of shale gas merely faced four corporations including CNPC, SINOPEC, CNOOC and Shaanxi Yanchang Petroleum Corporation. And the qualifications for application were adjusted during the second round of bidding for exploration right of shale gas. All units with qualifications of gas exploration (including coalbed methane and natural gas) are qualified. Thus, the second round of bidding for exploration right of shale gas witnessed a large amount of enterprises with coalbed methane exploration qualifications registering or participating the competitive bidding as operating representatives.

With regard to conventional oil and gas, its initial bidding pilot in Xinjiang has currently been conducted but cannot be totally cancelled since the prospecting license and mining license still require corresponding qualifications.

At present, Ministry of Land and Resources has adjusted relevant policies based on the consideration of laws and regulations and the need of reform. The open bidding for oil and gas exploration regions in Xinjiang did not make requirements on exploration qualifications, but the bid winner ought to select an exploration institution before exploration registration for a temporary qualification in Ministry of Land and Resources.

What qualifications are required for drilling the parameter well of shale gas depends on the specific behavior of drilling the parameter well. If it is merely a geological survey project, there is no need to apply the exploration right but a corresponding filing or application in local government department is required. If drilling the parameter well is purely a personal behavior, it may not be approved without any exploration qualifications.

Mr. Yu Haifeng, Director-General of Department of Mineral Resources Reserves under MLR: If the project of survey work is funded by finance, after being officially approved and replied, it can be drilled with permission of provincial departments of Ministry of Land and Resources. If the enterprise wants to drill the parameter well of shale gas with previously obtained oil and gas exploration right, it can be achieved through altering additional minerals. Except above two cases, it is the key for other enterprises to obtain the approval of provincial departments of Ministry of Land and Resources. Considering the complicated facts and different conditions, it is hard to simply decide whether it can be drilled or not.

Q: According to relevant state regulations, only the proved orefield financed by our country is allowed to charge for the mining right. In the past several years, the mining industry was in better situation and the mining enterprise did not particularly care about the assessment amount of the money paid for the mining right. However, in fact, there are many cases that the current documents or relevant materials are not very standard to fully evidence that the proved orefield is state-financed, which may cause the partial loss of state assets. Particularly, the enterprise who has obtained but not disposed the mining right has to pay for the charge with a large amount of money during alteration of mining mode. And the policies in all provinces (areas and municipalities) are different, what is the opinion of Ministry of Land and Resources on such issue?

Yu Haifeng: I have three points on this issue. First, according to our understanding in charge, the national finance investment on the geological survey project enables a valuable orefield formed or a valuable mine explored, which must reflect the right of national finance as an investor in the way of charge. However, in the practical work, all valuable orefields formed with national finance investment or vacant land without national investment in some provinces (areas and municipalities) are required payment and also called charge as long as they are remised. Therefore, a clear comprehension in the term of charge is required.

Second, we actually experienced such issues many times during the current audit and inspection tour in the field of mineral resources. Many officials in the system of Ministry of Land and Resources are arrested for involving the loss of state assets. With regard to the identification of criminal liability, both the auditing department and discipline inspection department ask for opinions of Ministry of Land and Resources. We insist on that if there is the investment based on national finance (including the central and local governments) and ore field or valuable ores are actually found, corresponding charge is surely required after the charge assessment of mining right. This system has never changed. However, the difficulty of this issue lies on whether the valuable ore field or minerals are found. It depends on the real historical materials at that time to prove whether they are drilled or conducted with heavy engineering and other works. Some surveys might happen in the 1950s and the workers in those previous projects cannot be found, which is hard to check and verify in this case and it merely depended on the current materials and numbered evidences. Charge is required if it is true, and charge is not required in the contrary situation. Of course this issue is hard to handle and it involves various interests from all parties.

Third, concerning charge assessment and its repayment, Ministry of Land and Resources is considering a number of new reform measures to relieve the pressure on enterprises for paying a large amount of charge, including installment payment or staged payment, or adjustment to payment with the varied mines income. The ultimate goal targets at resolving the issue in a way combined the consideration of actual difficulties faced by the enterprises with the protection on the authority of charge revenue. The system is under our study and has not shaped at present.

Q: There are still three questions to inquire. First, how to define the standard of “state-financed”? Second, with regard to the “state-financed”, the burden of proof should lie on the government. If the government fails to evidence the national finance investment amount and the already conducted survey on the involved valuable ore field, is it possible to consider that it is the government rather than the mining right people who cause the potential adverse effect? Third, at present, the installment payment on mining right charge is allowed within our policy. However, if the current charge is too high, a certain proportion of fund possession cost is surely charged in accordance with relevant regulations and the cost equals to the loan interest rate at the corresponding period. This is an extremely high financial cost, being the greatest financial pressure for every mine. Is there a better way to help the enterprises to resolve this problem and relieve the pressure?

Yu Haifeng: I want to talk the last question firstly. We are informed on the issue of financial cost that there is truly heavy burden on some domestic major enterprises of iron mine in this aspect and at least heavier than those in other countries around the world. The recent price of iron ore is lower and taxes and dues account for 37% of the whole income, which leads to great difficulty in continued running of the middle and small mines. Thus, it should be brought to the attention. Our preliminary idea is to work out a reasonable mechanism and adjust it with the market. In addition, a supportive policy for the enterprises is introduced in a special period, instead of blindly strict taxes or charges, to help the enterprise through this tough times.

The second question pertains to the fund possession cost. At the end of this year or so, Ministry of Land and Resources may shape an opinion on this issue and also on the previous mentioned issues—how to define the standard of “state-financed”? who will provide proof? What should do if there is a mass in explanation? —and on other issues.

Q: The latest document from Ministry of Land and Resources has mentioned the support to public entrepreneur and innovation and “land for new energy” are defined and explained in its content, with a special mention of the permission of leasing the photovoltaic land and the necessary formalities of construction land for farmland. Then, does the program of mutual supplement between agriculture and cultivation, fishery and cultivation require to go through the farmland formalities?

Mr. Yan Gang, Deputy Director-General of Department of Cultivated Land Protection under MLR: As regards photovoltaic land, our country has introduced a number of policies including growing rice and keeping fishes under the photovoltaic panel. Two groups are classified at present, the waste land which is directly access to and the cultivated land which is used in accordance with policies. In case of other new situations and new problems, it will be gradually worked out in the future.

Yao Huajun: This issues contribute great help to our work advancement, system improvement, reform deepening, services optimization and efficiency enhancement. At present, the mining industry has entered into a new development with new normal, new challenges and new opportunities, which also demands for higher way to develop and utilize the mineral resources. The transformation in development and utilization inevitably forces the birth of corresponding system and policies, even the adjustment, adaptation, supplement and improvement on higher laws and provisions. (Liu Aiying)

About CHINA MINING

Since first held in 1999, the scope and influence of CHINA MINING has grown rapidly year by year. As a global mining summit forum and exhibition, CHINA MINING Congress and Expo has become one of the world’s top mining events, and one of the world’s largest mining exploration, development and trading platforms, covering all aspects of the whole mining industry chain, including geological survey, exploration and development, mining rights trading, mining investment and financing, smelting and processing, mining techniques and equipment, mining services, etc. playing an active promotion role in creating exchange opportunities and enhancing mutual cooperation between domestic and foreign mining enterprises. For more information about CHINA MINING, please visit: www.chinaminingtj.org.

Let the geological relics "live"
--- focusing on the construction of geological parks in China

Source: www.mir.gov.cn      Citation: www.agkyb.com   Date: October 28, 2015

The lecture on special topic of Geopark and Geological Tourism Development during CHINA MINING 2015 was held at Meijiang Convention and Exhibition Center in Tianjin on October 23^rd. This was the first time to incorporate the session on “Geological Relic’s Protection and Geopark Construction” into the CHINA MINING Congress and Expo. The attendees shared experiences and achievements of geological park and geological tourism development in China.

Open a New Chapter in China Geological Park Construction

“The concept of geopark is put forward in the mid-1990s and the geopark construction aims at preserving geological relics and environment, popularizing science education and reasonably developing resources of geological relics to promote sustainable development in local society and economy, and making use of geosciences theories and methods and absorbing essence of other disciplines to serve for tourism resources survey, evaluation, planning, development, management and protection so as to advance tourism development.” Mr. Wu Zhenhan, Director of Scientific & Foreign Affairs Department under China Geological Survey and Vice-president of Chinese Academy of Geological Science, gave an introduction to the origin of geopark.

China is rich in geological relics with full range of types, as a rare country in the world. China firstly proposed that government departments led the organization and construction of national geological park and also became one of the early country with geoparks in the world. Ministry of Land and Resources held the forum on National Geological and Geomorphic Landscape Protection in Weihai of Shandong Province in 1999, with the proposal of initiating the program of national geological park. And two institutions, national geological relic and geopark leading group and its review committee, were established based on the program with a series of documents and standards.

The geological park construction in China is booming. According to the introduction from Madam Chen Xiaoning, Deputy Director-General of Geological Environment Department under Ministry of Land and Resources, there were 11 national geological parks approved in 2001 with 33 national geological parks in 2002 and 41 national geological parks in 2004… Up to now, a total of 185 national geological parks have been approved in China. In the view of distribution, our national geological parks generally spread across 31 provinces and municipals around the country. Among which, the geological parks in the western regions are well developed.

It is reported that China has started the application for world-class national geopark since the year of 2013 in order to respond to the proposal of world-class national geopark by the UNESCO. To date, there are 120 world-class geological parks across 33 countries and regions in the world, and 33 of them are in China with roughly a quarter accounted for all. A remarkable achievement has been made in our geological park construction with a unique management model, which has been praised by the UNESCO for our geological park construction playing a pioneering and motivated role.

Madam Chen Xiaoning indicated “Geological Environment Department of Ministry of Land and Resources, as the functional department for geological relic’s protection, has made continuous efforts to explore the way to preserve geological relics for many years. From constructing the simple conservation area to the geopark combined development with protection, the geological park construction is the best and effective way to protect the geological relics.

“China has taken the lead in the national geological park construction around the world and owns unique features, which has made a significant influence and played an important role in our social and economic development.” This is the evaluation from Wu Zhenhan about the role of geological park in China.

Active Exploration for New Model Across China

It is informed that Qinglan Geopark in Guangdong Province is initially slow to develop and covers a small scale of 17.16 square kilometers, mainly featuring with geomorphic water erosion. There are abundant and various geological relics and landscapes including hot spring, waterfall and green pound, and the Green Island of them is the AAAA scenic area in China.

Speaking of this geopark construction, Mr.Lin Wenfeng, county magistrate of People’s Government of Raoping County of Chaozhou City in Guangdong Province, indicated that Qinglan Geopark has consistently adhered to the principle of developing with protection and protecting with development and explored and formed a whole of feasible ideas and measures through practice.

First, innovating“protection and development”mode. A large amount of funds is required for the protection and development of a geological park. The Raoping County, the location area of Qinlan Geopark, merely owned the public financial budget of 400 million yuan in 2012, which was difficulty in covering the investment for protection and development of geological park. Facing this challenge, the government, based on the full investigation and survey, took the initiative to mobilize the leading enterprises in local tourism to be a part of the development and construction of geological park. With a cooperative model of separating the ownership and management, the ownership belongs to the local government, while the management depended on the autonomous investment of enterprises according to the principle of developing with protection and protecting with development. The enterprises were entitled to develop and utilize the geological park and assumed sole responsibility for their own management decisions, profits and losses; in addition, they were also responsible for the investment and construction of geothermal museum and other facilities for science education.

Second, strengthening government leadership and improving working mechanism. Qinglan Geopark has consistently placed protection as top priority and development as second to improve the mechanism for planning and management during the process of promoting the protection management and development utilization.

Third, promoting “protection and development” in high standards and quality. The county established the idea of building excellent a geopark during its construction, and merely spent three years, with the leadership of government and funds from enterprises, to bring the Qinglan Geopark into a large scenic area integrated the geological tourism, science popularization and research, leisure and vacation with ecotourism.

Qianglan Geopark innovated the running model of protection and development, adopted the cooperative model of separating the ownership and management, strengthened government leadership and gave a full play to the role of companies, which ultimately achieved remarkable benefits in society, ecology and economy.

Another geopark with significant progresses is exemplified by Alxa Desert Global Geopark of China. When mention of the geopark future, Madam Naren Tuya, Director of Alxa Desert Global Geopark of China,  gave full confidence on it. And she said, “Alxa Desert Global Geopark has currently entered into a new development stage and will continue to focus on the resources conservation and ecological environment construction of desert geological relics, promote the desert geoscience popularization and education and research, innovate working methods and strictly follow the standards for global geopark construction and management to explore a feasible and new management model of desert geoscience tourism conformed to the local sustainable development in society and economy so as to bring the desert geoscience tourism from Alxa into the world.”

Tianzhushan Global Geopark took advantage of its own strength to take an active part in the international cooperation and exchange to introduce its landscape and achievements in all aspects into the world. In addition, its unique features in working and achievement, which exemplify the very best in the construction, running and management of China global geological parks.

Yanqing Global Geopark, one of the geoparks in the Capital circle, is now working out a 3-year administrative outline. Mr. You Baojun, Director of Administration for Yanqing Global Geopark of China indicated that this geopark followed the construction principle of “establishment on science research, sustainable development, communication and mutual benefits”. Meanwhile, he also introduced the overall conditions of geoparks in the Capital circle. At present, Beijing totally owns 8 geoparks with 2 global geoparks including the Fangshan Global Geopark and Yanqing Global Geopark. Both of them in the mountainous area around Beijing are the ecological conservation area and also serve as the green protective screen for Beijing.

Geoscience Tourism Seizes Opportunity to Booming

The geological relic’s protection and geological park construction has aroused increasing attentions and concerns from China and the world and the geoscience tourism has also been developed and expanded in the geological park constructions.

Geoscience tourism was firstly proposed by a number of scholar in China and has shaped a science and talent-cultivation system after nearly 30-year development. Mr. Tian Mingzhong, Professor in China University of Geoscience (Beijing), considered that geoscience tourism mainly worked on the research on issues in tourism involving geography and basic disciplines and focused on promoting tourism developing to scientific tourism. In his opinion, geoscience tourism experienced four development stages.

First, the embryonic stage. The great decision of reforming and opening up in 1979 has motivated the initial development of tourism. At that time, the geoscience academy took active efforts to serve for the tourism with earth and scientific knowledge, but merely in the exploration stage. After 1985, the national geoscience tourism workshops were successively held across our country and the organizing committee of China Geoscience Tourism Research Society was founded.

Second, the initial stage. A series of academic conferences were held with the establishment of provincial organizations of geoscience tourism and the development and compiling of introduction to geoscience tourism, which played a vital role in cultivating the talents in Chinese tourism.

Third, the growing stage. The China Geoscience Tourism Research Society was established in 1992, and the 30^th International Geological Congress was held in Beijing in 1996 and introduced the geoscience tourism to more than 6000 attending geologists from over 120 countries. During this stage, China cultivated the first group of students with master and doctoral degree in geoscience tourism and accumulated theoretical knowledge and talents in geoscience tourism, which laid a foundation for our geological park system and gave the birth of the national geological parks in China.

Fourth, the pioneering stage. China started to apply and construct national geological parks, and the world-class geological parks began to born and grow in China. The China Geoscience Tourism Research Society officially renamed as the Geoscience Tourism and Geopark Research Branch of Geological Society of China in 2005, which served for the tourism in all-around way and paid more attention to serve for sound geopark development. This stage was considered as the milestone for the development of national geological parks in China.

With regard to the route design for geoscience tourism in geological park, Prof. Tian Mingzhong indicated, “it has to reflect the unique features and value of geoscience tourism in this geopark relic and guarantee the security, accessibility, science, distinctiveness, systematicness and sustainability.”

The Development Achievements and Future Direction

According to the introduction to the national geopark construction system from Madam Chen Xiaoning, above all, it is the application and review system. The national geological park carries out the review system of separating the qualification application and granting from designation approval. The application for national geological park requires that firstly the scientific significance of geological relic, secondly the value of science popularization and aesthetics of the geological relic with corresponding publicity, and thirdly a certain scale of geological relic. The procedure mainly experiences three stages including first qualification review, second planning construction and third designation approval. The application unit is reported by the local government of county, municipality and province where the geological park locates every two years, and incorporated into the national geological park planning after access to the qualification with 3-year construction period.

It is known that our geopark construction has gone on a development path for 10 years with rich experience and strengths. China worked together with the UNESCO in 2013 to conduct the training course of national geological park and geological relic’s protection in the African countries.

Madam Chen Xiaoning considered that the main progresses have been achieved in our geopark construction in four aspects. Firstly, the geological relic resources have been effectively preserved. Secondly, the geoscience popularization and research have been promoted. Thirdly, the local economic development has been greatly boosted. Fourthly, the cooperation and exchange at home and abroad have been advanced.

To be specific, geological park construction has effectively improved the preservation of geological relics, economically and intensively utilized the natural resources and provided important place for science research and science knowledge popularization so as to raise the preservation awareness of public ecological environment, develop the tourism with new connotation, build new model of geological work serving for economic society and support local economic and social development.

In the aspect of geological relic’s protection, the geological relics survey and evaluation established the geological relics database, set up the monitoring station in the conservation area, identified the class of conservation areas, strengthened the publicity and education to tourist and surrounding residents to decrease human damages, repaired and restored the landscapes of geological relics to decrease the natural weathering destruction and stipulated a number of local regulations and standards for geological relic’s protection.

It is informed that over 300 geological parks across the country has currently carried out the educational activities of geological science. The geological parks now have become the science research bases of universities and colleges and other research institutions, with over 200 science research and education bases established, over 8000 volunteers recruited, and the industry insiders publish their papers and conduct communication activities, which advances the geoscience popularization and research. All geological parks own their websites with Chinese and English versions, which has strengthened international communication and established friendly relations and cooperation. Sisterhood relations has been established among the geological parks, and up to now, there are 48 pairs of sister geoparks.

Every geological park is obliged to preserve the relic and share experience and achievements together to advance science research and improve the influence and reputation of geological park and geological relics. Build the best model for the regional sustainable development through experiences shared with each other and bring benefits to the local place to achieve common development and all-win situation. (Liu Aiying)

About CHINA MINING

Since first held in 1999, the scope and influence of CHINA MINING has grown rapidly year by year. As a global mining summit forum and exhibition, CHINA MINING Congress and Expo has become one of the world’s top mining events, and one of the world’s largest mining exploration, development and trading platforms, covering all aspects of the whole mining industry chain, including geological survey, exploration and development, mining rights trading, mining investment and financing, smelting and processing, mining techniques and equipment, mining services, etc. playing an active promotion role in creating exchange opportunities and enhancing mutual cooperation between domestic and foreign mining enterprises. For more information about CHINA MINING, please visit: www.chinaminingtj.org.

NDRC Supports international cooperation of China’s mining

Source: www.mlr.gov.cn  Citation: www.agkyb.com  Date: October 27, 2015

The National Development and Reform Commission (NDRC), Canadian Embassy in China and the Natural Resources Canada (NRCan) jointly held the tenth session of the Recommendation and Introduction to China-Canada Mining- Cooperation Promotions (China-Canada Mining Investment Forum).

During the meeting, the relevant officials from Department of Industries, Department of Foreign Capital and Overseas Investment and Department of International Cooperation under NDRC with officials from Canadian five provincial governments had in-depth exchanges of views on the current situation of international mining industry, international capacity cooperation, associate requirements of new energy in mining industry and related issues. The two sides also exchanged views on the improvement of Chinese enterprises’ power supply and infrastructure, lower taxes, labor permits and other issues.

In another related development, on the eve of conference, Mr. Li Zhongjuan, vice inspector of NDRC also had an in-depth exchange with Mr. Heidi Brock，President of Aluminum Association, focusing on the opportunities and challenges of global aluminum industry, the excess capacity of domestic electrolytic aluminum industry, tax policy of aluminum international trade, aluminium industry carbon emissions and other issues.

The relevant officials from NDRC’s Department of Industries, Department of Foreign Capital and Overseas Investment, Department of International Cooperation, the Canadian Embassy in China, NRCan, British Columbia, Newfoundland and Labrador, Saskatchewan, Quebec, and Yukon, and nearly 200 business representatives attended the meeting. (Liu Xiaohui)

About CHINA MINING

Since first held in 1999, the scope and influence of CHINA MINING has grown rapidly year by year. As a global mining summit forum and exhibition, CHINA MINING Congress and Expo has become one of the world’s top mining events, and one of the world’s largest mining exploration, development and trading platforms, covering all aspects of the whole mining industry chain, including geological survey, exploration and development, mining rights trading, mining investment and financing, smelting and processing, mining techniques and equipment, mining services, etc. playing an active promotion role in creating exchange opportunities and enhancing mutual cooperation between domestic and foreign mining enterprises. For more information about CHINA MINING, please visit: www.chinaminingtj.org.

Mr. Wang Jionghui: Global mining industry entered adjustment

Source: www.mlr.gov.cn   Citation: www.chinamining.com.cn   Date: October 27, 2015

With current global economic downturn and China`s economic development situation in the new normal, on CHINA MINING 2015, although many experts from home and abroad and scholars thought the future of the industry was very promising, and tried to shore up confidence in the global mining industry and dispel pessimism, there were a lot of people viewing this pretty carefully.

Judged from current mining situation, Mr. Wang Jionghui, general manager assistant of China Minmetals and mineral resources department general manager in the separate forum of the congress said," In CHINA MINING 2012, I made a speech about an article entitled Mining of Tomorrow , arguing that the analysis and future trends of anticipation were based on the global economic situation, and exploration development status, and mineral supply and demand, and market trend, and rigid cost changes and capital markets situation. We pointed out that the global mining industry has entered a downtrend channel, stepping into the ` winter ` season, but we just do not know if this winter is ` warm ` or ` cold `.” Wang Jionghui said, "now, we are going through a ` cold ` winter.”

From the point view of Wang Jionghui, global mining industry has experienced " a golden decade" prosperity and three consecutive downward years, entered the period of adjustment.

Crazy prices dive caused by oversupply

Mining was closely related to macroeconomic performance. China and other emerging economies were going into inadequate growth, and an interest-rate increase from the Federal Reserve was expected to strengthen and high volatility in recent capital market. All those factors currently contributed that the major mining companies and investment institutions had expressed concern about the prospects for mining, and made a pessimistic judgment of the future market in 3-5 years, thinking that the demand would fall further, prices of mineral products would continue to be downward, and extrusion capacity was further squeezed out. In this context, minerals industry would still in deep adjustment, and even some institutions considered the global financial crisis would come once again.

This view made sense, Wang Jionghui considered, the current macro environment was complex, and there were a lot of uncertainties. Global economic slowly recovered these years. United States, and India and the EU began to have a prosperous economic data, but other major economies were in the difficult period of restructuring. In particular, the situation of emerging economies is not optimistic. Russia and Brazil were into a deep recession, China`s economic restructuring and industrial restructuring were still in great pressure.

Wang Jionghui said that the recent capital market turmoil added to the concerns about crisis. Although the governments have introduced a number of stable measures, but the market confidence remains inadequate.

"Due to macro-economic downturn, the demand for metal products is reduced. The overall supply exceeds demand. Due to lack of confidence, metal mineral industry is still in the period of shock adjustment.” Wang Jionghui believed that main factors affecting metal mineral products price movement was that the demand China`s emerging economies has weakened.

China demanded the many global commodities. The consumption of iron ore, steel and other ten kinds of nonferrous metals ranked first in the world. The demand in China played an important factor in rising prices since 2000 commodities "Super-cycle". 4 trillion investments in 2009 also fully demonstrated China was supportive of metal mines products market. However, since the slowdown in economic growth in 2014, China was in the way of economic growth and industrial structure adjustment, which decreased demand for commodities, and the prices support has been decreased.

"Weak demand and oversupply make metal ore prices under pressure.” Wang Jionghui said, the decline of the commodity prices was essentially due to oversupply.

--Several large mining companies had low cost mine which continued expansion abroad, while the global demand slowdown, so excess capacity increased sharply.

--The global production capacity of copper released from demand for 122,000 tons last November to 151,000 tons of excess supply in the first half of this year, and the demand has gradually reversed;

Aluminum--the situation was different at home and abroad. The supply and demand were in a balance in the world.  With slow inventory reduction, the gap of supply was about 380,000 tons in the first half, while China was in overcapacity with sufficient inventory, the supply exceeded demand;

--The short supply of lead and zinc last year was ended. The global production of refined lead was 5.14 million and zinc were 7 million tons in the first half, with consumption of 5.12 million tons and 6.84 million tons respectively. They were currently in a state of balance between supply and demand;

--The demand of nickel in aerospace and other high-end equipment manufacturing remained strong, the oversupply has improved compared to last year, but there were high inventories;

--New minerals, tungsten, antimony, rare earth metals and other raw materials demand continues to slump with continuous oversupply.

Nevertheless, Wang Jionghui believed that current price levels were already at a low level. With the support of cost, the prices were much less likely to continue downward sharply. But it also faced some uncertainties, such as the big miners, emergency operations strategy, and so on.

"The dollar is entering into the appreciation cycles, so the dollar-denominated commodity prices will plummet.” Wang Jionghui said the historical data showed that the dollar index and commodity prices generally were in negative correlation. Since the second half of 2014, the dollar index rose from 80 to 95, appreciation of about 20%.

Wang Jionghui believed that prices of mineral products fluctuated according to financial property. Iron, copper and other commodities as a kind of financial asset, the price is also affected by investment demand, money supply and other factors. As the dollar had strengthened and the Fed to raise rates expectations was rising, investors expected commodity prices would remain in low turbulence. With gradual outflow of financial capital in commodities futures market, it turned to United States real economy and the stock market, leading to volatility in commodity prices.

"Born again" opportunity door slightly opened

Currently, numerous agencies saw that the mining is bearish, it would remain downward in the mining industry, and market pessimism spread out. However, mining was a cyclical business. Where there were peaks there were also valley. Wang Jionghui believed that recovery of global economy required support, and to judge how far the next spring of the global mining would come, the key factor was emerging economies` development and structural transformation led by China

Wang Jionghui said that although China`s economic growth had slowed but still in a period of middle high development, and still the driving force and engine for the development of the world economy. At present, China`s "three strategies”, and a series of special policies had injected new momentum to promote mining "pick up". New urbanization and industrial structure adjustment in China were in a good momentum. A variety of signs showed that, a series of investment and economic stimulus policies in almost two years had been effective, which was expected gradually to emerge in the first half of next year.

Wang Jionghui admitted, China would still maintain a strong demand for metal products. China’s industrialization and new urbanization was still in the process of medium-term development, which remained rigid demand for metal raw materials. Iron ore, steel, ten kinds of nonferrous metals consumption still ranked first in the world. Oil, natural gas and energy were in great demand. From the perspective of economic growth, GDP remained 6%~7% growths. The demand was still very impressive.

"It is estimated that in 10-20 years there will continue to be demand peaks in the future." From the perspective of downstream demand, driven by rural power grid construction and urban power grids, it was expected that demand for copper products will continue to grow rapidly in the coming years, but the new urbanization, regional integration, construction of key projects will continue to be an important support to the demand of steel. ” Wang Jionghui said.

In his view, the "three great strategies", economic restructuring and industry structure adjustment and other specific policies were not only opportunities for Chinese companies and but also the opportunities for global mining companies, which would effectively shorten the period of adjustment of mining.

First of all, China was experiencing the largest new urbanization in human history. The three strategies of the nation --"One Belt and One Road", Collaborative Development of Beijing, Tianjin and Hebe, urban agglomeration development plan of the Yangtze River economic zone and the Bohai region, would promote the coordinated development of large, medium and small cities and small towns. Meanwhile, infrastructure connectivity, industrial structure adjustment upgrading and others had a lot of space for development, which would create the new engine of China`s economic growth and restructuring upgrading.

"The integration of new urbanization integrates new energy, new technologies, new materials, making the metals and minerals industry to a new level of development. ” Wang Jionghui said that, with the exception of bulk raw materials such as copper, iron, lead, zinc, other mineral closely related to human existence, such as uranium, shale gas and other clean energy, new technologies minerals such as lithium, rare earth, minerals, potassium, phosphorus, potassium, phosphorus and other modern agricultural and water resources, would present a trend.

Secondly, China was accelerating the pace of reform to stimulate the market for the allocation of resources. A number of policies and measures had been issued one after another."This year, the State introduced `2025` made in China, ` suggestions of deepening economic system reform work ` and other a range of policies around the downstream of metal mining industry , State-owned enterprise top-down reform with top design combined with the demand for change from the bottom up, it aimed to inject new vitality into the development of enterprises. ” Wang Jionghui believed that this would create a new industrial revolution, which put forward higher requirements of traditional mining industrial structure adjustments.

Once again, the core of "One Belt and One Road” was the infrastructure and connectivity. Wang Jionghui said, as the implementation and further development of the strategy of "One Belt and One Road" in China, it would bring a lot of infrastructure needs and expand investment and economic trade cooperation space in the countries along the road. It would accelerate international cooperation capacity, and bring new impetus for development of mining industry.

Related statistics showed, "One Belt and One Road" propose would cover 4.4 billion people, with GDP more than $ 20 trillion, 63% and 29% of the world respectively.

Wang Jionghui believed that now the new trends of economic operation and new economic bright spot began gradually appear. The next few years, China`s three major strategy would enable China`s economic structure to change from investment-driven to demand-driven. This gave birth to enormous room for development and the birth of a new growth model, becoming China`s new kinetic energy.

In addition, India and other emerging economies and developed countries would also play an important role in demanding for mineral products. Wang Jionghui believed, economic growth of India boosted, and urbanization and industrialization were running step by step. Current non-ferrous metal consumption was only about one-tenth of China, and it would grow significantly in the future. China, India and neighboring countries, making the rapid development of the Asia-Pacific region play a more important role in the global economy.

Based on the reasons set out above and emerging signs, Wang Jionghui said that we were confident that, driven by Chinese economy, “Up" confidence in the mining industry would gradually recover, and downward trend would be reversed. The business would stabilize and gradually bottom out, ushering in a new period of development opportunities.

Wang Jionghui believed that specific links to industries would provide opportunities in some areas of excellent enterprises in China.

In terms of resource side, in the face of downward pressure, several major international mining companies had disposal of mining assets in order to control risk, including relatively high quality assets. For companies to global resource allocation, it was a low-cost access to high quality resources and opportunities to optimize the combination of resources. Of course, the mining company needed to focus more on differences in resource selection and configuration according to their own advantage and development strategy. In recent years, China Minmetals seized the opportunity to buy overseas assets such as the State copper mines of bath.

In terms of circulation, commodity circulation industry in China was in face of lack of  credit system , the low degree of integration of logistics, increased international giant monopoly and so on. With the capacity to reinventing itself, effort in the industry transformation was likely to achieve new breakthroughs. The development of commodity could improve circulation efficiency and gain enormous room for growth. Using of policy on reconstruction of China`s participation in the new trade order and actively developing overseas markets would have an opportunity to improve the voice of global circulation. Among those with a strong integrated strength, advantages of industrial operations, and large enterprises with better brands would have an important opportunity.

In terms of material application, new materials, intelligent equipment auto industry would achieve rapid development, and high demand for metals would continue to expand. the price of back- end processing products with high profits is rigid. China was rich in resources, but the whole industry chain is not well developed. The added value of technology and economy was low. Among those companies which had domestic resources or stronger integrated power would also usher in an important opportunity.

Mining would undergo profound change in the future

"The competition in the future, was not just a competition of product or channel, but competition of effective integrated system of resource, even concurrency conciousness beyond the competition.” Wang Jionghui said, at present, Internet, cloud computing, big data, and other innovative technology was rapidly changing the traditional business and market rules.

He said, we lived at this time of change, we could not avoid neither technically and conceptually.  Only with active of faith could we face the challenge of market environment. We should take advantage of "Internet +" and other innovation technologies to build flat efficient of organization, technology innovation platform, and financial service platform, and electric business platform, advance management, and manufacturing, and financial and trading. Therefore, we could promote the optimization cost of management, manufacturing, financing and transaction in order to improve quality and efficiency and strengthen competitiveness.

To take the Minmetals group for example, China Minmetals was a trade-oriented enterprise. In the last 10 years, through the strategic transformation and further development, it achieved two-wheeled development of resources and trade. Wang Jionghui said, in recent years, China Minmetals has actively undertaken the national strategies mission, strengthening resources and markets layout at home and abroad, speeding up structural adjustment and restructuring upgrading, initially building the chain of metal ores industrial integration and globalization.

However, Wang Jionghui admitted, although China Minmetals developed fast in recent years, but they also had some difficulties and had to solve the problems. To resolve these difficulties and problems, they had to not only rely on their own efforts, but also to learn from peer-excellent enterprise, and established a new partnership to realize win-win progress.

Wang Jionghui said that at present, China Minmetals was making bold innovation in portfolio optimization, improving cost of space, rebuilding commodities trade capacity rebuilding, industrial chain driven by innovation, and deepening internal reform of enterprises.

First, we should make clear of the responsibilities and missions, with further focusing or metallic core business and strengthening of layout differences in resources and markets at home and abroad. we should be “protector of national resources safety, innovator of resource industry, drivers for a mass circulation of transition" in order to build a world-class metal mining group.

Second, we should return to the nature of business to focus on resources and capital, and continue to get access to high quality resources, optimize the allocation of resources. We should make innovation in the development in mining content, and maximize the value of their assets. Minmetals would continue to fulfill central social responsibility, pay attention to work safety and environmental protection; They would use of new ideas, new technology, new management processes, continuously to improve the operation mode of modern production and optimize mining costs in order to control the cost which could be designed.

Third, we should control the risk, practice skills, make innovation, and increase investment in human capital. We should match the strategic vision of world-class metal ores group, deepening reform. We should rely on our own resources, strengthen external cooperation, and concentrate the outstanding scientific and technological personnel. We should increase mining and beneficiation-metallurgy technology and the research of new materials, to deep the chain of industry value and make greater contributions to the development of the metals and minerals industry.

(Li Ping) 

About CHINA MINING

Since first held in 1999, the scope and influence of CHINA MINING has grown rapidly year by year. As a global mining summit forum and exhibition, CHINA MINING Congress and Expo has become one of the world’s top mining events, and one of the world’s largest mining exploration, development and trading platforms, covering all aspects of the whole mining industry chain, including geological survey, exploration and development, mining rights trading, mining investment and financing, smelting and processing, mining techniques and equipment, mining services, etc. playing an active promotion role in creating exchange opportunities and enhancing mutual cooperation between domestic and foreign mining enterprises. For more information about CHINA MINING, please visit: www.chinaminingtj.org.

Mr. Song Xin: China becomes the leader of the world’s gold market

Source: www.mlr.gov.cn  Citation: www.agkyb.com  Date: October 27, 2015

Despite the impact on the gold industry exerted by the continued downturn in the global economy had exceeded expectation, the reporter got the latest information from the Mining Development Summit Forum of CHINA MINING 2015 that the performance of China`s gold industry in the economic winter did not show any weaknesses.

Mr. Song Xin, general manager of China National Gold Group Corp and the president of China Gold Association expressed his opinion in his speech on Oct 22^nd. He said, in recent years, with the fact that the global economic slowdown, gold prices downturn, resource constraints and increasingly fierce situation of market competition, China`s gold industry has achieved leap development of a whole industrial chain including exploration, mining, smelting, trading, design, processing, consumption and investment.

"In 2014, China`s gold output reached 451.80 tons and became the world`s largest gold producing country for 8 consecutive years. With annual gold consumption of 886.09 tons, China once again became the world`s largest gold consumer. " Song Xin said. At the end of 2014, the country had found gold reserves of 9816.03 tons, ranking second in the world.

At the same time, the integrated technique of complex ploy metallic refractory gold concentrate developed by China independently had reached the top level in the world. In the field of geological exploration, deep mining, gold purification, Jewel crafting we also made new breakthroughs. With the improvement of market function, a variety of trade category, expansion of the trade scale and increase of participants，the international influence of China’s gold industry continued to expand.

Song Xin was proud to say that, instead of a follower, China had grown into a leader in the world`s gold industry. We had already possessed the basis and conditions to move to a higher level. However, he also expressed his own concern on the future development of China`s gold industry. And to the current situation of China`s gold industry and gold companies, he put forward his own views on how to adapt to the new normal, seize new opportunities and promote new development.

Challenges and opportunities

"To figure out the challenges and opportunities in the development of the gold industry is the foundation of better formulating measures to promote scientific development." Song Xin said the current situation of the development of gold industry was still grim.

First, the world economic environment was still relatively complicated. The world economy was still in a deep adjustment period, with low growth, low inflation, low demand and high unemployment, high debt, high foam and other risk intertwined, the main economic trends and policy orientation continued to differentiated. And the uncertainty of economic environment was still significant. With prominent geopolitical factors, the global economic environment was still relatively complex. Under this kind of international circumstances, opportunities and challenges were intertwined.

Second, with downward pressure on China’s economy building and deep-seated problems in development surfacing, the health foundation of our economy was still same as usual. On the other hand, China was still in an important period of strategic opportunity during which great progress could be made in development. Our country’s development had enormous potential and huge resiliency, and we had ample room for growth. In the face of mounting downward economic pressure, we exercised targeted regulation to keep the economy growing steadily. In the past three quarters, the economic growth had met the expectations of the target, the main economic indicators had been picked up and structural adjustment had continually advanced. With the improvement of agricultural situation, the development of energy had increased. At the same time, the economic downward pressure on China’s economy had continued to mount, andsome enterprises faced a lot of difficulties in their business operation, such as the structural contradictions of the shortage of new power in economic growth and the pullback of old power.

Third, the road to gold industry growth was full of difficulties. With the dollar strength, a new normal of gold prices running low would be very common in the next few years. Since the beginning of this year, the price of gold had fallen 4.23% year-on-year; copper products prices had fell 15.31% year-on-year. Some newly built projects faced double squeeze of rising costs and declining benefits. With increasing financial, cost and benefit pressure in the gold industry was huge. Some leading gold companies had to face the difficulties, such as tight cash flow and rising debt rate.

"In the face of difficulty, we should be clearly aware of the opportunity for the development of the gold industry at the same time." Song Xin said, especially for the current economic downward pressure, the state introduced a series of new strategies and policies, so that China`s economic development presented a new trend and features.

Firstly, the development strategy of the “Belt and Road” Initiativehad built an important stage for the development of gold industry. Most countries along the“Belt and Road” Initiative were mostly emerging economies and developing countries, with a total population of about 4.4 billion people and about 21 trillion dollars of the total economy, accounting for about 63% and 29% of the world’s population and economy respectively. With the total gold reserves of 21000 tons, accounting for 41.5% of the world`s total reserves, these countries possessed abundant gold mineral resources and consumer demands. In 2014, the total national gold production of these countries was about 1116 tons, accounting for 35.6% of the world`s total output. There were six of the world`s 20 largest gold mine in this region. In the same year, the jewelry consumption amounted to 2025 tons, accounting for 82.4% of the world’s total number; the physical gold investment demand about 778 tons, accounting for 77% of the world’s total amount.

Our country owned advantages of gold exploration and mining metallurgical technology and talents that make highly complementary with the countries along the “The Belt and Road Initiative”. At the same time, the requirements of infrastructure for the development of gold resources were not high, especially in the initial period of implementation of the "Belt and Road” Initiative strategy. Under the circumstance of no electricity and transport, relying on diesel generator and a simple mining road, we had already achieved infrastructure construction and production to show a leading role. The implementation of the "Belt and Road”Initiative strategy would bring new historical opportunities for China’s gold industry.

Secondly, a series of national policies such as transformation of the mode and the adjustment of the structure had brought a broad space for the development of gold industry. Our country is still in an important period of strategic opportunity, which has a brilliant future. The implementation of effective national policies such as Internet Plus strategy, "Made in China 2025" plan, urbanization and promotion of equipment going global and international production cooperation etc. will release a huge dividends of reform. In particular, the Internet Plus strategy and Intelligent Manufacturing strategy for the gold industry would break the traditional technology and innovative marketing model to promote the industry transformation and upgrading, and create a new space.

Thirdly, the national policy supported for the gold industry continues to increase the national policy support for the gold industry continues to increase, which had created favorable conditions for the rapid development of the gold industry. The State Council continued to implement the policy of streamlining administration and delegating more powers to lower-level governments. The relevant departments and local governments had accelerated the approval rate of gold mining project, simplified the relevant procedures, and provided convenience for the construction and development of gold mines. The implementation of " Measures for the administration of the import and export of gold and gold products " had explicit declared and relaxed the eligibility restrictions of the import and export qualification of gold and gold products. All of these provided a good external environment and favorable conditions for the development of gold enterprises.

Seven measures to overcome the difficulties

"Gold is a special product with double attributes of both commodity function and currency function. Gold is not only material wealth, but also the means to store wealth. It is the material basis of modern credit money and the most faithful assets." Song Xin said that in a special state, the gold even equaled to strategic resources to resolve the crisis and keep the security.

"In the new era, with a more important mission, gold is responsible for enhancing credibility for internationalization of the RMB." Song Xin revealed that China recently released the latest data of national gold reserves for four times. Figures showed that, with an increase of 654.4 tons, China`s gold reserves reached 1708.5 tons at the end of September this year, compared with the total amount of 1054.1 tons released at the end of April 2009.

" All of these strategic layout and major initiatives are our country’s proactive steps to strengthen the credit basis of the RMB internationalization, which can be seen, the state attaches great importance to the gold reserves." Song Xin said that under the new circumstance, we should take effective measures and actively respond to international and domestic changes in the macroeconomic environment. For the purpose of promoting the sustained and healthy development of China`s gold industry, we should take the whole picture into consideration but do the job bit by bit.

Firstly, we had to take the early advantage of gold industry in the strategy of the “Belt and Road” Initiative to strengthen the joint with other countries and accelerate the pace of industry’s “going global”. Under the strategic framework of “the Belt and Road”Initiative, gold industry as the leading industry was given priority for in-depth bilateral cooperation in the field of gold exploration, mining, processing, consumption and investment. All of measures and policies had important significance to promote the healthy development of China`s gold industry, enhanced national gold control and built bulwark for national financial security. In the process of gold industry’s “going global”, gold enterprises, especially large group, should learn from each other and work together , summarize and derive the previous experience of “going global” for further development of China’s gold industry. To increase cooperation with the gold resources rich countries, we should promote the project of joint exploration and development of offshore gold resources to build a new pattern of global allocation, development and utilization of gold resources. Meanwhile, we also had to expand the development space of the gold industry from inside China to outside, the national gold control force from the domestic to the world.

Secondly, we had to continue to increase investment in scientific and technological innovation, and further expand the industrial space, focusing on further strengthening the main role of enterprise technology innovation and key role of large-scale enterprises’ innovation. Through the gold industry technology innovation strategic alliance, we would strengthen development and research on common problems encountered in the gold industry, such as new technology application for resource exploration, deep exploration technology and equipment, technology of ultra deep mining’s cooling, ventilation and rock burst, low grade refractory metallurgical resources utilization, containing cyanide tailings filling, tail slag in the comprehensive recovery of valuable elements, for the transformation of gold enterprises from single business mode to multi metal type and multiplicity operation pattern. At the same time, we also should provide technical support to extended field, including gold deep processing and jewelry processing.

Thirdly, we needed to increase the intensity of high-quality resources reservation, scientific and rational development and utilization of resources. Resources were the lifeblood of the mining enterprises, the basic prerequisite and guarantee for the development of mining enterprises. Under the circumstance of gold prices low consolidation, lower appraisals on gold resources and mining, new opportunities would be brought to transformation and upgrading of gold industry and to low cost expansion of resource and capacity integration. All of this might lead to a new round of integration and waves of mergers and acquisitions of gold industry. At the same time, we should make use of our advantages to make intra-industry development more sustainable.

Fourthly, we focused on strengthening the safety and environmental protection work to improve the performance of social responsibility. To fulfill corporate social responsibility and develop green economy was a strategic issue to gold enterprise`s own future and destiny. In the future development, the gold industry must strictly implement the New Safety and Environmental Protection Act and further improve the safety and environmental protection work to achieve the healthy and sustainable development of gold industry. We must firmly implement the instruction made by President Xi Jinping "development must not be at the expense of human life" and always insist on putting workers’ safety in the first place. We had to take strong steps to ensure the implementation of “Three Basic Principles of Safety and Environmental Protection”, increase the major risk management efforts, improve the management system of special rectification education, training, environmental protection, occupational health, emergency rescue and accountability system etc. and build long-term mechanism of safety production and environmental protection.

Fifthly, we took measures on optimizing “five rates”, cost cut and efficiency promotion and cost control, reducing the "five charges" and enhancing the core competitiveness of enterprises in mines. Faced with the challenge of the current and future period of market, the gold industry should make solid progress in self-construction, strengthen management and increase efficiency. We should take into consideration the promotion of organizational management and core competitiveness, firmly grasp the key node in the production process, dig down the efficiency index, establish and improve the system and technical standard of optimizing “five rates” and reducing the "five charges". We would ensure the implementation of fine management to each step of the mining process to constantly improve the cost control of whole industry chain and cost competitiveness of enterprise life cycle. Work had done to implement the investment philosophy of “Never give up optimizing until the last moment.” According to work thinking of “The most effective way to cut the cost to increase the profit is the saving from design” and “The biggest waste is the waste of design.” We channeled great energy into making adjustment in the structure of industry. Our goal is that “Win at the starting line with the smallest input to maximize the output and efficiency.”

Sixthly, we gave attention to talents reserve building to cultivate capable teams of managers and technicians and provide key support for the development of the industry. Enterprise competitiveness not only depended on the objective conditions, such as capital, resources, but also mainly depended on the human factor. Therefore, the training work and the mine geological prospecting had the same significance to enterprises. Gold industry should follow the principles by improving the quality of workers as the core, take various forms to strengthen the staffs’ professional ethics education, business skills, and servicequality toenhance competitiveness. We should also strengthen the training of international talents, in order to meet the needs of the “going global” strategy.

Seventhly, we took timely action to accelerate the integration of gold jewelry industry and high-tech, the transformation and upgrading of gold industry. We seized the opportunity of smart manufacturing, “Internet Plus” action, actively explored the practice of gold e-commerce to drive the innovation in product, marketing, and service mode. We also needed to associate with the companies, which possessed advanced result of technical research and application to build effective mechanism of unifying research and sharing result. We would deepen industrial reform and strengthen the integration of technology to achieve smart manufacturing of gold jewelry, promote industrial and consumption upgrading and enhance the international competitiveness of China`s gold jewelry industry. (Li Ping)

About CHINA MINING

Since first held in 1999, the scope and influence of CHINA MINING has grown rapidly year by year. As a global mining summit forum and exhibition, CHINA MINING Congress and Expo has become one of the world’s top mining events, and one of the world’s largest mining exploration, development and trading platforms, covering all aspects of the whole mining industry chain, including geological survey, exploration and development, mining rights trading, mining investment and financing, smelting and processing, mining techniques and equipment, mining services, etc. playing an active promotion role in creating exchange opportunities and enhancing mutual cooperation between domestic and foreign mining enterprises. For more information about CHINA MINING, please visit: www.chinaminingtj.org.

Silk Road Fund leverages mining enterprises “going global”

Source: www.mlr.gov.cn   Citation: www.agkyb.com  Date: October 27, 2015

The world economy was undergoing profound adjustment and its recovery lacked drive, which caused a downturn in mining investment. In the CHINA MINING Congress and Expo 2015, some professionals said that the global mining investment field had entered in a wait-and-see state. The downturn of price, rise of mining costs and slow growth of economy had affected the enterprises’ investment decisions in the field of mining.

Despite the fact that the pessimistic mood gained the upper hand during the conference, the different views from some owners of mining enterprises expressed that the next two or three years should be the best opportunity for mining investment. With the downturn of ore price, many overseas mining enterprises market value had shrunk dramatically. Due to the cash flow difficulties, they had to sell their assets at a discount. According to this situation, some nationals and local governments dominated by mining resources would launch more tax preferential policies in the trough.

From a logical angle, this view made sense. Of course, it would naturally recognize by many people in this industry. But the key question was, in the low tide of mining industry, the great scale restriction on mining enterprises financing. We all known that the present stage was a good time to overseas mining investment, but unfortunately, without enough money, perfect opportunities only equaled to helpless encounter. When ore prices strengthened again, pity for the loss of best chance was the only thing we can do.

Fortunately, it was given a new solution to the current dilemma at this conference. Mr. Si Xinbo, deputy general manager of the Silk Road Fund, said that they could provide better choices for Chinese enterprises’ overseas mining cooperation. This seemed to add a warm current to this winter of mining industry. There was no doubt that these words showed a promised future for the present Chinese enterprises.

Domestic and international influence factors for the rise and fall of the mining industry

"At present, the world economy is undergoing profound adjustment, the mining industry is facing many difficulties and challenges. Historical experience shows that the distribution, development and utilization of mining industry are closely related to the world economic pattern." Si Xinbo, deputy general manager of Silk Road Fund said. The development and changes in the international economic situation had an important impact on the rise and fall of the mining industry.

After the financial crisis in 2008, the global economic recovery had been slower than expected, and presented obvious regional differences. The first two quarters of this year, the United States, as the main driving force of global economic growth, its GDP growth rate reached over 3.7%, China had maintained a high growth rate of 7% in the first half. With the implementation of the European Central Bank bond-buying plan, investment plan and other factors, the euro zone gained more support from many countries besides Germany, France. Japan, India and Southeast Asian countries benefit from the decline of oil prices and capital costs, the growth of their economy was dramatic. The African region also attracted more foreign investment，the growth rate remained at more than 80%.

At the same time, some countries were still digesting the high debt, high unemployment and other follow-up impact of the crisis. Some countries also had to face a series of difficulties such as aging population, labor productivity growth slowed down and so on. The euro zone economy was still fragile. The economic growth of emerging markets including Asia, Latin America and the CIS countries fell significantly.

At present, the world economy was undergoing profound adjustment, its recovery lacked drive force, the influence of geopolitics and natural disaster was increasing, the there were a greater number of uncertainties at play. The potential growth factor and market risk were intertwined. This situation would make the global economy to maintain a deep adjustment of the slow growth for a period of time. The development of the global mining industry was also faced with the challenges of insufficient demand, financing obstacles and other challenges.

By the end of the first half of this year, China`s industrial added value continuously rebounded for 3 months. The whole society electricity consumption continued to rise in April, total retail sales of social consumer goods and new consumption maintained rapid growth, real estate sales improved significantly, the overall stability of employment and the income of urban and rural residents growth higher than the GDP growth rate.

"But at the same time, the domestic infrastructure construction is playing a weaker role on the steady growth of economy. Due to insufficient demand from international market, the performance of export is below expectations. The deflationary pressure can not be ignored." Si Xinbo said that downward pressure on China’s economy continued to mount, and we faced an array of interwoven difficulties and challenges.

Over the past ten years, the rapid growth of China and other emerging market economies injected a strong driving force into world economy, resulting the huge demand which had became the most important driving force for global mining boom. Si Xinbo said, under the current circumstance, China`s economy was in a critical period of changing its growth mode. The structure of its economy had been optimized, but the growth rate slowed down. The influence of China and other emerging market economies on global mining industry had been weakened.

He believed that new changes and challenges faced by global mining industry were due to the global and economic growth in the experience of the depth adjustment that the traditional momentum weakened and the new power had not been generated.

Mining investment should pay attention to “Four Major Trends"

"Although the global mining industry will continue in a period of downturn, some prospective trends have been shown in the depth of the adjustment." Si Xinbo said.

Firstly, the downturn in the global mining industry would last, yet there was no sign of improvement. The slowdown in global economic growth, coupled with oil prices dropping to 5-year low, and triggered the commodity prices decline in a row. All of these reasons pushed global mining industry fell to the most severe situation since financial crisis. It was considered that it would continue to fall in the next two years.

According to SNL data monitoring, metal price index fell to 103 points in June from 107 points in March this year. The number of global exploration projects fell to 380 in the first quarter of this year from 418 in the fourth quarter in 2014, and continuously fell to 363 in the second quarter of this year. The global mining activity index PAI reached 44.3 in June this year, near the lowest point of 40.2 during the past 3 years.     

"The growth of global mineral resource consumption has slowed significantly." Si Xinbo believed that the supply of mineral raw materials and processed products transformed from insufficient to excess. There was a common price crisis faced by mineral products, mining assets and mining companies. In the short term, without a clear turning point, the downturn would last for a period of time in the whole global mining industry.

Secondly, the expansion of the mineral geological exploration transformed from the traditional mining countries to the developing countries and regions, which possessed abundant mining resources. Mineral exploration was a process of continuous exploration and discovery. Combined with the overall downturn in the development of mining industry and cost pressures, the attraction of Canada, Australia and other traditional mining countries had significantly reduced in the proportion of global mining investment. The hot spots of mineral exploration and mining investment gradually transformed to the Latin America, Africa and other places.

For instance, in 2014, Canada became the first choice for world`s ten largest mineral exploration enterprises. At the same time, the exploration of deep sea, high altitude and polar mineral was becoming more and more popular. Under this circumstance, higher requirements were put forward to the better cooperation of the capital, technology, equipment and the whole industry chain.

"Expanding the scope of mineral exploration provides the basis and confidence for the recovery of the global mining industry." Si Xinbo said, with the global economic situation gradually improved and the integration and upgrading of the mining industry, the overall performance of the global mining industry should be improved in the next two to three years,

Thirdly, the mining area of social responsibility and environmental protection standards were increasingly stringent which heightened the technical threshold and cost pressures of mining investment cooperation. Traditional mining operations often accompanied by environmental problems. While with the change and adjustment of the global economic growth mode, the demand of changing the quality and efficiency of mineral resources development and utilization was continuously increasing.

"This means that the threshold of investment in the mining industry will be higher and the cost will increase at the same time. This situation will promote the global mining industry to develop to a new stage, which based on the mechanism for selecting the superior and eliminating the inferior. Return on investment and efficiency will be the first criterion." Si Xinbo said that in the field of investment, large multinational banks and investment institutions gradually focused on their social responsibility and environmental protection. Necessary attention should be paid on the future development of international mining development. The relevant investment cooperation also should attach importance to fulfill their social responsibility and take action on environmental protection in the framework of income and risk analysis.

Fourthly, the industrial downturn accompanied by the loose regulation, which prompted the mergence and reorganization more active in international mining areas.

"Severe market situation brings more pressure on the mining industry, but also provides more demands and opportunities for integrated restructuring." Si Xinbo said the large international mining companies preferred to use asset acquisition and restructuring to optimize the capital structure, improve the quality of operations and reduce operational risks.

SNL statistics showed that in the first quarter of this year, there were 23 deals of the global mining mergers and acquisitions and the number of second quarter is 35. The total sum of first quarter of the global mining mergers and acquisitions related to metal resources is $2.93 billion and in second quarter increased 2 times, the total sum over 6.5 billion dollars.

"In order to contain the economic downturn and improve their mining industry’s competitiveness, some mining countries take measures to amend the law, adjust taxes, speed up approval and other measures to improve their investment environment, showing a new trend of loose regulation in the mining industry." Si Xinbo believed that the change of market environment and policy background created new opportunities and space for optimizing the allocation of mining resources and investment cooperation.

Experts explain the "Silk Road Fund" functions

China`s Silk Road Fund was the adaptation of global and China`s economic growth mode transformation trend. It was dedicated to the common development, mutual benefit and win-win of all countries along the “Belt and Road initiative”.

"The situation of global economy is still not optimistic; the pressure of recession is still existing in many industries including mining. Countries need to strengthen coordination and cooperation in the fields of trade, investment and finance to be able to ride out the storm and seek common development. As an important part of economic globalization, there is no exception for China. " Si Xinbo said.

Silk Road Fund was established under the background of China’s the “Belt and Road” initiative, and the trend of global and China`s economic growth mode transformation and cooperation pattern upgrade. Si Xinbo said that the Silk Road Fund was willing to provide many better selections for Chinese enterprises overseas mining cooperation.

First, positioning of the Silk Road Fund

On November 8, 2014, President Xi Jinping delivered a key speech at a dialogue meeting on strengthening connectivity partnership and announced that China will commit 40 billion U.S. dollars to establish a Silk Road Fund, which was to finance connectivity programs in countries along the "Belt and Road". The new Silk Road Fund would be used to provide investment and financing support to carry out infrastructure, resources, industrial cooperation, financial cooperation and other projects related to connectivity for countries along the "Belt and Road". According to Xi, the goal of the new Silk Road Fund was to "break the bottleneck in Asian connectivity by building a financing platform."

Therefore, the Silk Road Fund had the following features:

Firstly, Silk Road Fund, which was to finance connectivity programs in countries along the “Belt and Road” initiative. It was aiming at promoting a more equitable and balanced model of partnership, achieving mutual benefit and win-win with other countries, providing financial support and financing platform for cooperation in a wide range of related areas and laying a solid foundation for long-term and stable development of world economy. Secondly, instead of pursuing short-term profit, it was a long-term development and investment funds. In particular, it was willing to provide financial support to the long investment cycle projects, which based on the facility, energy resources, industry and financial cooperation. Thirdly, it was mainly based on the equity investment, supporting enterprises to transform from the EPC based project contract to the identity of the shareholders to conduct the depth participation of the project, through strengthening the control of the project and improving business management to achieve real international business. Fourthly, it could be flexible to provide credit for the formation of financial support, which was conductive to the enterprise in accordance with the characteristics of the project and the transaction structure to properly arrange the optimal financing institution. Fifthly, instead of being an aid or policy funds, it was commercialized management based on market operation. Following the market rules and requirements and maintaining sustainable, it could bear its historical mission preferably.

Second, investment philosophy of Silk Road Fund

a). The Silk Road Fund’s investment operation was based on cooperative principle of developing dialogue and planning with other countries at the same time. The “Belt and Road” initiative followed the concept of peaceful cooperation, openness and tolerance, mutual learning and mutual construction. Silk Road Fund would be used to provide investment and financing support to carry out infrastructure, resources, industrial cooperation, financial cooperation and other projects related to connectivity for countries along the "Belt and Road", through cooperation to achieve common prosperity.

b). Silk Road Fund’s investment operation also insisted on the efficiency principle of pursuing long-term reasonable investment return. Built as a joint-stock company, Silk Road Fund’s related operation must be in the pursuit of long-term and reasonable return on investment, which was responsible for the investor and the foundation of equal cooperation and win-win basis with other market subjects.

c). At the same time, Silk Road Fund’s operation also adhered to the principle ofcomplementary advantages and win-win cooperation to other financial institutions at home and abroad. Silk Road Fund followedboth of Chinaand receiving country’s law and regulation, complying with the international rules of the market and the international financial order, paying attention to the green environmental protection and sustainable development, respecting other domestic and foreign financial institutions business to offer more richer choices for enterprises and projects in diversified investment and financing ways. In the blueprint for jointly promoting the healthy and stable development of the global economy, the Silk Road Fund and other domestic and foreign financial institutions had built a partnership based on complementary advantages, cooperation and win-win basis.

d). Silk Road Fund’s investment operation also insisted on the principle of providing equal opportunities to every investor. Silk Road Fund was an open and inclusive institution, welcoming both of domestic and foreign investors to participate in the project. After operating for a period of time, it also considered to open more opportunities to investor, or cooperate on a sub fund level with whether multilateral institutions or various types of industrial investment and investment institutions. Silk Road Fund would open the mind to find suitable opportunities for cooperation, and with these institutions work together for contributing to the development and prosperity of the region and to the world.

Thirdly, the investment direction of Silk Road Fund

With the purpose of jointly building business and share ideas, Silk Road Fund mainly provided support to carry out infrastructure, resources, industrial cooperation, financial cooperation and other projects related to connectivity for countries along the "Belt and Road". Si Xinbo said that except above countries, other countries and regions as long as suitable for Silk Road Fund investment projects could also be considered to provide investment and financing support. Geographic location was not considered as strict restrictions.

Si Xinbo said, the Silk Road Fund would continue to support enterprises with strength to cooperate with each other, focusing on sharing the experience, high technology and advanced production capacity of China`s industrialization and modernization, promoting the common development and prosperity of the relevant countries.

At the present stage, Silk Road Fund focused on the investment in infrastructure industries including transportation infrastructure and public facilities; energy and resources industry including oil and gas, new energy and mining development; production capacity and technical cooperation industry including large complete sets of equipment, industrial base and introduction of high technology, and financial industry cooperation for overseas mergers and acquisitions of financial and services to Chinese enterprises to go global.

Silk Road Fund escorts mining overseas expansion

“Silk Road Fund is a ship, which has set sail in the sea of “the Belt and Road” initiative; Silk Road Fund is a bond which is committed to promote the organic combination of industry and capital. Under the premise of mutual benefit and win-win, Silk Road Fund also is a good partner to jointly promote international investment and cooperation in mining industry. ”Si Xinbo said.

Firstly, the fund could play a unique role in focusing on investment of “the Belt and Road” initiative. Silk Road Fund was a special investment and financing mechanism established by China to support “the Belt and Road initiative”, focusing on providing investment and other projects related to connectivity for countries along the "Belt and Road initiative". With short decision-making chain and effective decision-making, it would conform to the trend of the global mining industry’s development; promote Chinese enterprises and countries along the route to carry out more in-depth and diversified investment and cooperation.

Secondly, the Silk Road Fund could play a role in enhancing mutual trust and investment leverage. Mining industry was typical capital-intensive industry. With high investment in geological prospecting, mining, production, processing and other aspects of the mining industry, transaction amount of mining trade and investment ranked on the top of the international trade statistics.

“Silk Road Fund as a state-backed professional investors, with a high level of credit and financial strength, was able to provide necessary capital support to mining development, mergers and acquisitions for the enterprises or projects, increase credit, promote the maturity of project, achieve financing conditions and promote the project to implement as soon as possible." Si Xinbo said, for the capital operation of mining enterprises’ mergers and acquisitions, the Silk Road Fund could play a role of the professional financial investors and become a reliable business partner.

Thirdly, Silk Road Fund could make effort to dampen economic cyclical changes and stabilize the market. The supply chain and investment environment of international mining had a very strong correlation with the economic situation of every country. With its own characteristics, investment in mining needed large amount of money, long investment cycle. And it was difficult to steer and benefit. The cyclical fluctuation in the industry was the main problem faced by investors.

“Compared to the general investment institutions, Silk Road Fund as a mid-to-long-term investment fund, its investment period attaches great importance to the long-term reasonable return and longer than usual mode. Therefore, the Silk Road Fund can across the development of the industry cycle, have higher tolerance on short-term financial volatility. It can help enterprises to deal with periodic pulse of the market ups and downs and achieve long-term and stable development. " Si Xinbo said this was the rarest financial investors to the mining industry.

Fourthly, the Silk Road Fund could play a synergistic role in a variety of investment tools for flexible combination. "Mining production and investment is usually accompanied by a more complex transaction structure. The design of investment and financing model are the two issues of crucial importance of the project`s success or failure." Si Xinbo introduced that Silk Road Fund’s main pattern of investment was equity investment. Meanwhile, it also provided all types of investment loans, debt, mezzanine capital, sub-funds and other patterns of investment. It was one of those rare investment institutions could take all types of investment tool to carry out capital investment. It would try its best to meet demands from every party to better cooperation between mining enterprises and projects investment and financing. For the purpose of achieving maximum benefits, Silk Road Fund designed plans in targeted ways and build the most reasonable structure of cooperation.

Fifthly, the Silk Road Fund also had an effect on improving the efficiency and adding value. In practice, some countries or international organizations would promote the development and utilization of mineral resources in the way of capital investment. But most of this investment was policy oriented, with the essence of assistance, it often difficult to achieve long-term sustainable.

Si Xinbo said, on the basis of complying and cooperating with every country’s development planning, Silk Road Fund adhered to market-oriented operation. The professional investment team established by Silk Road Fund had the ability to participate in mining cooperation, both as investors with high credit and financial advisor with professional quality. It helped enterprises to accurately grasp the direction of development, effectively reflect to the market signal, improve corporate governance, optimize the investment and financing plan, promote enterprises’ combination of macro development strategy and micro market efficiency, and increase the long-term value.

Sixthly, the Silk Road Fund could play a leading role in capital and industry. Mining economic development as the basic resources of economic development, with numerous upstream and downstream industries, it had long industrial chain. Silk Road Fund could play an exemplary role by virtue of its many advantages, including mid-to-long-term equity investment mode severed as main invest mode, vast areas and more flexible forms of investment.

Si Xinbo said Silk Road Fund would continuously make effort to lead and catalyze social capital and international capital to invest in mining areas under the background of the “Belt and Road”initiative. It also could help relevant enterprises to develop from the mining areas further to the upstream and downstream of the whole industry chain. Silk Road Fund would commit to find more potential and valuable investment opportunities to achieve accumulation effect of “1 plus 1 greater than 2”. (Li Ping)

About CHINA MINING

Since first held in 1999, the scope and influence of CHINA MINING has grown rapidly year by year. As a global mining summit forum and exhibition, CHINA MINING Congress and Expo has become one of the world’s top mining events, and one of the world’s largest mining exploration, development and trading platforms, covering all aspects of the whole mining industry chain, including geological survey, exploration and development, mining rights trading, mining investment and financing, smelting and processing, mining techniques and equipment, mining services, etc. playing an active promotion role in creating exchange opportunities and enhancing mutual cooperation between domestic and foreign mining enterprises. For more information about CHINA MINING, please visit: www.chinaminingtj.org.

Belt and Road Initiative opens opportunities for Chinese gold miners

Source: www.chinamining.org         Citation: Xinhua        Date: October 26, 2015

The China`s Belt and Road Initiative will bring a historic opportunity for the country`s gold miners as low gold prices are expected in the coming years, said Song Xin, general manager of China National Gold Group Corporation.

Addressing at Mining Development Summit Forum of CHINA MINING Congress and Expo 2015 held in north China`s Tianjin Friday, Song said the next few years will see global gold prices remain low while costs for the gold mining industry rise.

But the "Belt and Road" will provide an alternative platform for growth, as countries along the route have a combined natural gold reserve of 21,000 tons, accounting for 41.5 percent of the global gold reserve, said Song. The world`s six largest gold mines are located in countries along the "Belt and Road."

Chinese gold miners have an edge in exploitation, which is complementary with the "Belt and Road" countries that are rich in gold reserves, he said.

"This is a new historic opportunity for Chinese gold industry," said Song.

The Belt and Road Initiative refers to the Silk Road Economic Belt and the 21st Century Maritime Silk Road, which were proposed by Chinese President Xi Jinping in 2013 with the aim of reviving the ancient trade routes.

The network passes through more than 60 countries and regions with a total population of 4.4 billion. 

About CHINA MINING

Since first held in 1999, the scope and influence of CHINA MINING has grown rapidly year by year. As a global mining summit forum and exhibition, CHINA MINING Congress and Expo has become one of the world’s top mining events, and one of the world’s largest mining exploration, development and trading platforms, covering all aspects of the whole mining industry chain, including geological survey, exploration and development, mining rights trading, mining investment and financing, smelting and processing, mining techniques and equipment, mining services, etc. playing an active promotion role in creating exchange opportunities and enhancing mutual cooperation between domestic and foreign mining enterprises.

CHINA MINING Congress and Expo 2016 will be held at Meijiang Convention and Exhibition Center in Tianjin on September 22^th-25^th, 2016. We invite you to join the event and to celebrate the 18^th anniversary of CHINA MINING with us.  For more information about CHINA MINING 2016, please visit: www.chinaminingtj.org.