Prospecting Progress and Exploitation Perspectives on China’s Major Nonferrous Metal Resources

Since the launch of a new round of land resources surveying by the Ministry of Land Resources (MLR) at the beginning of the 21st century increased, and the Chinese government has been increasing investment in domestic geological prospecting. In the survey, China has carried out basic, public and strategic surveys and evaluation on mineral resources in an all-around way across the country, making great breakthroughs in terms of geological prospecting and discovering a number of large and super-large deposits. Although global investment in mineral prospecting declined in 2009 as a result of the financial crisis, China’s investment in basic geological surveys and solid mineral prospecting increased to RMB 27.7 billion, up 17.5% over the previous year.In 2010, the Chinese government again increased its investment in mineral prospecting significantly. Over the next few years, China’s proven mineral reserves are expected to increase, thus providing new bases for production of industrial raw materials in the future.

Major areas for metal mineral prospecting in this geological survey are as follows - the Three River Area (southwestern China), Yarlung Zangbo River, Kunlun Mountain, Tianshan Mountain, Qinling Mountain, Qilian Mountain, Greater Khingan Mountains and Nanling Mountains. The guiding principles of this survey include prospecting for new large and super-large deposits in western China,prospecting for concealed deposits and deep deposits in central and eastern China, and prospecting for deep deposits in traditional mining areas and neighborhoods.

Funding sources for China’s mineral prospecting include the central government (including mineral resources compensation fee), local government (including mineral resources compensation fee), and companies and institutions(including foreign-invested enterprises).

In 2008, China invested RMB 3.468 billion in prospecting for the following 9 key nonferrous metals (investment proportion also indicated) -copper 58.29%, bauxite 9.17%, lead and zinc 1.8%, nickel 3.56%, molybdenum 16.92%,tungsten 6.31%, tin 3.09%, antimony 0.86%.

Between 2001 and 2008, as investment in mineral prospecting increased, proven reserves of the 9 key nonferrous metals did too, with annual growth rates as follows - copper 2.76%,bauxite 3.01%, lead 3.5%, zinc 2.38%, nickel 1.1%, molybdenum 3.75%, tungsten 0.37%, tin 0.8%, antimony 2.22%.

Between 2001 and 2008, growth of basic reserves in the proven reserves of the 5 minerals(copper, nickel, tungsten, tin and antimony)was noticeably lower than that of mine exploitation, while basic reserves declined.

Among the 9 key nonferrous metals, copper has the lion’s share of total investment in ore prospecting, and a number of achievements have been noted. In recent years, 21 large and superlarge copper mines were discovered. According to figures covering incoming investment construction for copper resource prospecting in China, China’s proven copper reserves are expected to increase significantly between 2010-2015. Western China is a major growth area now, of which Tibet is expected to hit 40 million tons, making it the part of China with the largest reserves. Xinjiang is expected to overtake Jiangxi and Yunnan with reserves exceeding 10 million tons.

Follow-up funds for commercial prospecting will determine whether the resources can be upgraded to basic reserves and also the time of exploitation. It is expected that both Tibet and Xinjiang will have 2-3 mining areas (such as Xaitongmoin, Qulong, Halasu and Dabate) that can be exploited by 2020. Copper resources in western China shall be exploited and utilized in a modern and large-scale manner. Tibet provides a fragile ecological environment and energy shortage; mineral exploitation shall therefore be carried out ideally by means of mining and dressing rather than smelting.

According to China’s bauxite minerogetic conditions, prospecting shall focus on neighboring areas of traditional mining areas including Henan, Shanxi, Guangxi and Guizhou. In recent years, China’s bauxite reserves have grown rapidly in the following provinces and autonomous regions: Henan (322 million tons),Guangxi (161 million tons), Guizhou (113 million tons), Shanxi (53 million tons), of which new mines in Guangxi, Henan and Shanxi have favorable conditions for exploitation and can be used as backup production resource bases.

Poor quality bauxite ore in China results in production costs of homemade aluminum oxide being higher than those for comparable foreign aluminum oxides. In terms of China’s current manufacturing capabilities for aluminum oxide and its share of the global market, China can absolutely control violent fluctuations in aluminum oxide prices internationally. Therefore,Chinese aluminum manufacturers shall boost cooperation with international players, make use of superior bauxite resources of neighboring countries, reduce production costs, improve economic benefits and enhance international competitiveness.

In recent years, remarkable achievements has been registered in terms of investment in prospecting for lead and zinc, despite investment falling short of that for other key nonferrous metals minerals. According to incomplete statistics, the reserves of 13 newly-found mining areas exceed 16 million tons. In addition, more reserves are expected to be proven in Xinjiang’s Qimantag and Tibet in the years to come.Huize (Yunnan), Huangshaping (Hunan) and(Mozhu) Tibet belong to productive mining areas, and reserve growth will extend the life of mines in these areas. It is estimated that Wulagen mine (Wuqia County, Xinjiang) and Biliya(Deerbuer, Inner Mongolia) mine will be exploited by 2020.

Investment in prospecting for nickel mines has been increasing in despite minerogenetic restrictions. Currently, new large-scale nickel mines have become a bottleneck of China’s nonferrous metals prospecting. In the future,China faces grim prospects in terms of significantly increasing its nickel ore supplies.

The main recent prospecting achievement is that Henan Geological Prospecting Bureau discovered a large-scale copper and nickel deposit at Zhou’an, Tanghe County. The deposit has been proved to contain 324,300 tons of nickel and 120,000 tons of copper.

JNMC, together with domestic geological survey institutions, has found a nickel ore belt in the Beishan area between Gansu and Inner Mongolia in northwestern China, including copper and nickel deposits in Gansu Heishan,

Zhongposhan No.1 Bijiashan and Xinjiang Hami. Currently, JNMC has completed a detailed geological survey of nickel and copper deposits in the Heishan part of the area. Based on a cutoff grade of nickel of 0.3%, the reserves have reached the level of “large-scale”.It is reported that JNMC invested RMB 0.9 billion in the first phase, mainly in construction and exploitation of the Heishan mining area,which has a daily ore processing capacity of 3,000 tons.

It is very likely to discover a new large-scale copper and nickel deposit in Sunitezuo Banner(county), which is near Erenhot of Inner Monogolia.

A nickel ore body related to dunite has been discovered in Hami (Xinjiang). Other achievements have been noted in deep and neighboring prospecting in Kalatongke (Xinjiang) and Hongqiling (Jilin).

In 2008, 3 nickel mines were found in China:Gaxian nickel mine in Oroqen (Inner Mongolia), with an estimated reserves of 103,200 tons; Poyi nickel mine (Ruoqiang County, Xinjiang), with an estimated reserves of 66,900 tons; and, Tianyu copper and nickel mine(Hami, Xinjiang), with estimated reserves of 11,300 tons and controlled reserves of 14,400 tons.

In recent years, remarkable breakthroughs were made in molybdenum ore prospecting, and the reserves growth tops all small ore species of nonferrous metals. According to incomplete statistics, reserves in the 12 newly-found mining areas exceed 2.7 million tons, sufficient for future exploitation. Currently, China’s molybdenum output is large, and exploitation of these new large-scale mining areas will be restricted by market demand, but associated molybdenum in copper mines are likely to be recovered as a by-product in the process of copper mine exploitation.

Among mineral products exported by China,tungsten, tin and antimony perform strongly in the international market. In recent years,growth of proven reserves of these minerals has been lower than mine exploitation, so reserves are declining. These minerals are protected by the Chinese government, which will approve exploitation by newly-found large and medium-sized mining areas, according to plans.

With regards to the particularity of the minerogenetic conditions of black tungsten, largescale black tungsten deposits are hard to come by. The recently-reported discoveries are mostly related to white tungsten deposits.

A large-scale tungsten and molybdenum deposit, of which the tungsten reserve is 94,500 tons, has been discovered in Qimen County(Anhui).

A white tungsten deposit with reserves of 30,000 tons has been discovered in Qingyang County (Anhui), and is expected to reach the level of “large-scale”.

A large-scale tungsten mine has been found in Mazongshan area of Ejina Banner (Inner Mongolia), with the metal reserve of 50,000 tons,according to preliminary prospecting.

Zedang mine area of Shannan polymetallic ore(Tibet) has become a large-scale base (detailed survey) of copper, molybdenum and tungsten.The reserves of Meiduo antimony mine (Tibet)has reached the level of “large-scale”, while that of Renma antimony mine has reached the level of “medium-sized”.

A group of large and medium-sized deposits have been discovered in Qimantag mine (Xinjiang), of which estimated tungsten and tin reserves of Baiganhu tungsten and tin mine field is 200,000 tons, and long-term reserves include 4 million tons of copper, 4 million tons of lead and zinc, 2 million tons of tungsten and tin and 500,000 tons of bismuth.

The super-large tin ore belt discovered in Hunan is located in Qianlishan-Qitianling, Chenzhou, with proven reserves of 500,000 tons and potential reserves of approximately 700,000 tons. It is expected to exceed 1 million tons.

A tungsten and molybdenum mine has been discovered in Sunan (Gansu), covering Xiaoliugou tungsten deposit, Guishan tungsten and molybdenum deposits, Qibao copper and tungsten deposits and Shiji copper and tungsten deposits. A general survey is currently underway.