In recent years, as China's economy has grown rapidly, the consumption of mineral resources has surged, leading to a widening gap between supply and demand. By 2005, China’s crude oil consumption surpassed 300 million tons, steel usage reached 400 million tons, coal consumption hit 2.14 billion tons, and domestic mining of various ores exceeded 7 billion tons. The country had to import large quantities of crude oil, iron ore, copper, and alumina. Meanwhile, the growth in reserves of key minerals failed to match the rising output, and production could not keep up with demand. Overall, the state of mineral exploration remains concerning. These views were shared by Wang Min, Deputy Minister of the Ministry of Land and Resources, at the 14th Land and Resources Management Mayors’ Seminar held on July 3.
Wang Min highlighted that the main challenge in current geological work is outdated exploration methods and weak service capabilities. In non-oil and gas sectors, the reform of the geological system is slow, public and commercial geological mechanisms are unclear, and the vitality of exploration units is lacking. Investment mechanisms remain incomplete, funding for geological work is insufficient, and there is a significant loss of skilled professionals. Additionally, equipment is outdated, and technological support needs improvement. Addressing these issues requires urgent action. To improve geological work in the new era, it is essential to fully implement the scientific development concept, make use of both domestic and international resources and markets, focus on the domestic market, prioritize key areas, improve systems, and rely on technological innovation. Key breakthroughs must be made in critical fields.
Wang emphasized that focusing on key mineral exploration is crucial to quickly forming new resource bases. He noted that such efforts are vital for the national economy and people’s livelihood. Resource exploration should follow natural resource distribution and geological rules, identifying clear priorities. Recently, the Ministry of Land and Resources has organized expert reviews, analyzed economic needs and metallogenic conditions, and identified 16 key minerals, 11 major oil basins, 13 large coal bases, and 16 important metallogenetic zones. Currently, oil and gas exploration must be prioritized, with accelerated surveys in major land and marine basins. Large-scale coal base investigations and necessary detailed studies should also be advanced, along with the exploration of unconventional energy sources. The goal is to achieve breakthroughs in energy exploration during the Eleventh Five-Year Plan period and increase resource reserves. Non-energy mineral exploration should focus on iron, copper, aluminum, and potash to create new reserves. At the same time, efforts must be accelerated to find replacement resources for crisis mines and resource-depleted cities.
Wang also pointed out that the government can play multiple roles in commercial mineral exploration. First, it should conduct non-profit geological work. Second, it should nurture and expand the commercial exploration sector. Third, it should develop and regulate the mining rights market, capital market, and intermediary services. Fourth, it should rectify the exploration market, protect investors' rights, and create a favorable environment for geological exploration. Given the high risks involved in exploring energy and other critical minerals, the government should establish geological exploration funds and increase preliminary exploration efforts to stimulate commercial investment. Fifth, the government should promote openness, encouraging both "importing" foreign expertise and "going global."
Additionally, Wang mentioned that due to the non-renewable nature of mineral resources, the government will advance the paid use system for resources, improve the paid acquisition of mining rights, and refine the paid mining system, as outlined in the State Council’s decision on strengthening geological work.
Looking ahead, Wang emphasized that the distribution of mineral resources will become more rational. While maintaining the ownership of mineral resources, the government will consider the interests of central and local governments, miners, and local communities. Following the principles of "exploration first, then development, compensation and protection, cost reflecting safety, price reflecting scarcity, open and fair markets, and orderly enterprise movement," the government will work with relevant departments to address issues like free mining rights acquired historically, adjust fees for exploration rights, implement a floating rate policy for resource compensation, and establish mechanisms for environmental governance and ecological restoration. These efforts aim to form a comprehensive set of reform measures.
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