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China: One Mine, One Company Policy
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By the end of 2008 China will complete its reforms of the mining industry to ensure only one company can exploit a mine's resources, according to a central government statement.

The move is designed to reduce the number of accidents, cut pollution and improve efficiency in the way mineral resources are used.

According to a document released by nine ministerial-level agencies, including the Ministry of Land and Resources, the policy will be in place for at least three types of mineral resources and in at least five major mining areas before the end of 2007.

"The whole reshuffle should be finished and exploitation of one mine by more than one company should be terminated by the end of next year," the document states.

Data from the Ministry of Land and Resources shows there are 5,345 mining areas with verified reserves nationwide but the number of mining franchises totals 13,227. A mining area is often exploited by several enterprises particularly in the coal sector.

"Multiple mining of an area which should be exploited by one enterprise often leads to pernicious competition and production beyond capacity. The result is frequent accidents, inefficient use of resources and pollution of the environment," said a senior official surnamed Bai with the Ministry of Land and Resources.

Last year China recorded more than 4,800 mine accidents which claimed more than 7,000 lives. The majority of accidents were in small mines.

The 17,000 small collieries nationwide account for one third of China's total coal production but two thirds of accidents and related deaths. China plans to shut down 10,000 unqualified small collieries by 2008.

Chinese mines are also subject to small-scale yet extensive operations. "The mines have gone down the path of unsustainable development," said Liu Baojun of the Chinese Academy of Sciences.

According to the document large enterprises with more advanced technology, stricter management and better equipment should take over the smaller mines.

Provincial governments will take responsibility for the changes. "Areas failing to complete the process of integration in time should be inspected and closed off to prospecting and mining franchises," the document says.

The document also ordered the establishment of an environmental restoration system at all mines and mining waste to be stored and disposed of in a centralized way.

(Xinhua News Agency January 22, 2007)

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