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Clean energy and environmental opportunities in the Chinese mining and minerals sector

Market research report

January 2012

Research commissioned by:

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Table of contents

Foreward 1

Executive summary 2

1. Introduction 4

1.1 Scope 4

2. China's mining industry – overview 6

2.1 Subsector and regions 7

2.2 Mining industry structure 9

2.3 Mining environmental performance and challenges 11

3. Regulations and motivation 13

3.1 Chinese laws 13

3.2 Policies, regulations, and guidelines 14

3.3 Regulatory enforcement 16

3.4 Government initiatives and programs 16

4. Potential opportunities 20

4.1 Funding for environmental projects in mining industry 21

5. Case studies 24

6. Priority opportunities and recommendations 26

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Foreword

The Australian Trade Commission - Austrade - is the Australian Government’s trade, investment

and education promotion agency. Through a global network of offices, Austrade assists

Australian companies to grow their international business, attracts productive foreign direct

investment into Australia and promotes Australia’s education sector internationally.

Austrade commissioned GHD to conduct research into the environmental and sustainable

mining sectors in China, with a view to identifying and scoping opportunities for Australian

companies.

This report outlines the results of this study, which will assist Australian companies to further

understand the market. It also provides advice for pursuing quality opportunities in China‟s

sustainable mining sector.

The report has been prepared by GHD under the guidance of Austrade.

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Executive summary

China‟s mining and minerals processing industry is the largest in the world1. Not surprisingly, it makes a significant contribution to the country‟s gross domestic product. Unfortunately, mining sector activity has also resulted in significant negative impact on the environment, and in the area of public health.

Responding to these issues, the Chinese Government has strengthened existing laws, drafted new regulations and improved monitoring and enforcement of mining operations, which has required mining and processing operations to improve their environmental and safety performance. This is creating a growing number of opportunities for environmental services and technology providers in China.

For example, almost 900 mining operations were recently halted in Inner-Mongolia due to non-compliance with environmental laws2. They were required to make improvements before they could re-open. Such drastic action is forcing mining and processing companies to adopt improved technologies, remediate existing environmental contamination, and develop environment management plans for ongoing operations. This is a new approach to mining in China and significant capacity and technology gaps exist.

The Chinese Government is also funding programs to:

(i) Remediate historical mine contamination, including the National Heavy Metal Pollution Remediation Program providing CNY75 Billion for remediation of historic contamination.

(ii) Promote more sustainable mines through the Green Mining initiative which provides incentives for certified Green Mines including streamlined access to financing and approvals for mine expansions3.

(iii) Increase environmental policies and guidelines including the proposed introduction of a national mine rehabilitation guideline4.

This combination of increased regulation and enforcement, funding, incentives and gaps in capacity and technology presents business opportunities for Australian Clean Energy and Environment (CEE) companies.

However, challenges also exist and need to be considered in assessing the opportunity. These include sensitivities within State Owned Enterprises (SOEs) in particular, about working with foreign companies, strongly localised markets, and a lack of business transparency in some

1 World Bank, 2011. Overview of State Ownership in the Global Minerals Industry. 2 China Daily, February, 2012.

3 China Mining Association, 2012.

4 Ministry of Environmental Protection, 2012.

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regions and subsectors. Even so, this study has identified several favorable areas for Australian providers of services and equipment. Four priority areas of opportunity are outlined to help target the business development of Australian CEE companies with an interest in China:

1. Opportunities under the National Heavy Metal Pollution Remediation Program in Inner-Mongolia.

2. Opportunities under the National Heavy Metal Pollution Remediation Program in Hunan Province.

3. Opportunities in tailings storage facility management and rehabilitation.

4. Requirements for international best practice environmental assessment.

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1. Introduction

This report was prepared by GHD Pty Ltd (GHD) under a service agreement for Austrade.

The objectives of the study were to (i) summarise the key features of the China mining industry (non-oil and gas) with respect to developing opportunities for Australian CEE companies, (ii) outline key regulatory drivers, government initiative and programs supporting environmental opportunities, (iii) present case study examples of Australian and other international companies already providing environmental solutions and technology to support a greener mining sector in China, and (iv) highlight broad areas of opportunities for Australian CEE companies.

This study was not intended to develop detailed information on specific opportunities, rather provide a broad initial assessment of the potential for new opportunities. The study covers the non-oil and gas mining sector in China, focusing on the key subsectors of coal, ferrous (iron ore), non-ferrous (copper, gold, zinc, tin, lead, manganese) and rare earths. The scope extends to minerals processing, however is limited to mine site processing facilities. .

Addressing environmental issues in the mining and minerals sector has attracted considerable research and discussion in developed countries such as Australia, Canada and the United States. In China, however, few similar studies have been conducted and research on technologies and approaches to address these impacts is minimal. As a result, this study has relied heavily on primarily research, including interviews with Chinese mining companies, the Chinese Government, industry associations and Australian companies operating in China‟s mining sector. We have also utilised case studies published in the local media. The study has been developed in collaboration with Austrade, who attended and supported several interviews.

1.1 Scope

The scope of this report includes:

Desktop research. Our initial research included (i) research and compilation of essential information on China‟s mining and mineral processing sector, including key companies, geographical regions and subsectors, and (ii) review of China‟s relevant environmental legal and regulatory framework, including new guidelines and government initiatives.

Interviews and discussions. Interviews were held with more than 30 individual stakeholders including representatives from government agencies, industry bodies, local (Chinese) and foreign companies operating within the Chinese mining sector. The following provides a summary of the key stakeholders interviewed:

- Ministry of Environmental Protection (MEP) - China Mining Federation (CMF) - China Non-ferrous Metals Industry Association (CNFMIA) - China National Coal Association (CNAC) - China Non-metallic Mining Industry Association (CNMMIA) - Beijing General Research Institute of Mining and Metallurgy (BGRIMM) - Non-ferrous Metal Industry's Foreign Engineering and Construction Company

(NMIFECC) - Minmetals Group - Fushun Mining Group - GHD Pty Ltd - Earth Systems Pty Ltd - Creative Water Technologies Pty Ltd

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- University of Queensland - CSIRO

Analysis. Based on information gathered, constraints and challenges impeding environmental improvement in the mining sector were analysed, and potential opportunities were identified. Based on this analysis four priority areas of opportunity have been identified for environmental companies in the mining sector in the near term.

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2. China’s mining industry – overview

China‟s mining industry has experienced rapid development and growth over the past decade, driven by increasing demand from the energy, manufacturing and construction sectors. Despite a recent easing in economic growth compared with the pre-Global Financial Crisis period, China remains the world‟s largest consumer of minerals and the world‟s largest producer of coal, steel, cement, aluminum, lead, zinc, tin, magnesium, tungsten, antimony, mercury and rare earth metals.

The total revenue of China‟s mining and minerals market in 2009 was USD825 billion, with a compound annual growth rate of 18.2% from 2005 to 20095. China‟s coal mine production capacity has grown by over 1.5 billion metric tonnes since 2000, achieving an output of 2.52 billion tonnes in 20076. Overall, the mining industry consists of approximately 9,000 large State-Owned-Enterprise (SOE) mining companies and some 100,000 medium to small sized SOE and collectively-owned mines7. Foreign investment in China‟s mining sector is subject to several restrictions, as discussed further below, and is relatively limited in the non-oil and gas sectors.

Serious challenges lay ahead for the Chinese mining industry with regard to environmental improvement, as rapid growth in the industry has resulted in environmental controls and performance lagging behind international practices, and created severe environmental impacts which require complex and costly remediation 8 . Several studies show that environmental regulations, pollution prevention, and resource use efficiency technologies have struggled to keep up with the rapid growth of China‟s mining sector.

In the 11th Five Year Plan (FYP), the Central Government emphasised a „greener‟ approach to mining, highlighted in the paper produced by the Ministry of Land and Resources (MLR) in 2007 entitled „Towards Green and Sustainable Mining‟. As part of this paper, the Congress declared that China‟s mining industry will take steps to conserve natural resources, protect the environment, and demonstrate „harmonious development‟ with consideration for environmental, social and economic „pillars‟ 9 . The 12th FYP provides further support for improving the environmental performance of China‟s mining sector including the Green Mines initiative and a CNY 75 Billion fund for historic pollution remediation. These recent developments in environmental regulation, enforcement, government initiative and funding provide increased opportunities for Australian CEE companies in the China mining sector.

5 World Bank, 2008. Economically, Socially and Environmentally Sustainable Coal Mining Sector in China. 6 World Bank, 2008. Economically, Socially and Environmentally Sustainable Coal Mining Sector in China. 7 State Council, 2010. China Mining Industry Year Book 2010. 8 World Bank, 2011. Overview of State Ownership in the Global Minerals Industry. 9 MLR, 2007. Towards Green and Sustainable Mining Working Paper.

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2.1 Subsector and regions

China‟s mining industry is highly diverse and geographically expansive. China has proven reserves of 159 resource types, among which there are 10 categories of energy resources, 54 types of metals, and 91 non-metal minerals 10 . Non-oil and gas mining and production is dominated by coal (67%), iron ore (9%), non-ferrous metals (7%) and sands and aggregates (10%), with other types of mining and processing making up the remaining 7%. Figure 1 shows the mining subsectors as a percentage of China‟s total annual production value.

Figure 1: China mining subsector production as a percentage

Note * Other includes rare earths, precious metals and mineral waters, Source: State Council, 2010. China Mining Industry Year Book 2010

The broad geographical distribution of mineral resources within China is shown in Figure 2, and can be summarised as follows:

Coal. Major coal resources and production is concentrated in the northern and central provinces of China.

Ferrous. Ferrous metal reserves, mines and processing are clustered around central-southern China and north-northeast China.

10 State Council, 2010. China Mining Industry Year Book 2010.

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Non-ferrous and rare earths. Non-ferrous metal and rare earth reserves, mines and processing are clustered around central-southern China and north-northeast China.

While China has significant minerals resources with proven reserves ranking third in the world by volume, China‟s production of energy resources (coal, oil and gas) and key ferrous and non-ferrous metals (high-grade iron ores, copper, aluminum, phosphorus and potassium) are significantly outweighed by growing demand. Compounding this issue, energy resources and key ferrous and non-ferrous metal reserves are in many cases low-grade, making mine development costly and the smelting process more energy intensive and polluting. Mineral resources are often located long distances away from the high demand urban areas in eastern China, resulting in transportation challenges, which also contribute to environmental impacts.

Figure 2: Broad distribution of mineral resources within China

Source: China Mining Federation (www.chinamining.org)

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2.2 Mining industry structure

The Chinese mining industry structure is fragmented with many small operations and a relatively high cost of production. However, when considering revenue, the industry is dominated by large SOEs accounting for almost 80% of mining and production by value. The top four mining companies by market value are summarised in Table 1.

Table 1: Top Four Chinese Mining and Oil Companies

Company Name Headquarters Revenue

(Bn $)

Profit

(Bn $)

Assets

(Bn $)

Market Value

(Bn $)

Mineral

Shenhua Beijing 6.47 1.94 17.08 45.94 Coal

China Coal Energy Company Shuozhou 3.73 0.41 3.27 10.49 Coal

Yanzhou Coal Mining Zoucheng 1.43 0.36 2.63 4.52 Coal

Minmetals Beijing 8.25 0.04 3.46 1.5 Diversified (Metals)

Source: Forbes top 2000 global companies, 2006

While large SOEs dominate mining and resource production, they comprise only 9% of the total number of mining companies licensed in China. In addition, the government recognises the issue of many more non-licensed small mining operations throughout the country. The MLR is increasing efforts to close down unlicensed mines and consolidate smaller mining companies within the industry. Environmental compliance with government regulations is a key aspect of the consolidation of the mining sector, with larger sized mining companies often having more developed environmental policies, monitoring and pollution response capabilities (discussed further in section 3). Consolidation of smaller mining companies is expected to generate growing demand for advanced and large-scale equipment within this industry.

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2.2.1 Foreign investment

The Chinese mining sector is largely under state control by central, regional or local government11. As a result foreign involvement in China‟s mining industry is limited, however increasing in recent years, particularly in the oil and gas sector.

Foreign invested mines account for about 1% of the total number of mining companies licensed in China. This is important to note when considering opportunities for Australian CEE providers, as unlike some other industry sectors, Chinese mining operations are often less familiar with foreign companies.

The central government broadly outlines three categories for foreign investments in the mining sector:

Encouraged. Foreign investments is encouraged in areas of (i) exploration and development of oil, gas, coal-seam gas, iron ore, and manganese resources, (ii) new technology research and development in geophysical survey, drilling and recovery efficiency of oil and gas, and (iii) new technology research and development in the area of utilization of mine tailings and integrated approaches to mine site environmental restoration. Areas where foreign investment is encouraged may be a good focus for Australian CEE providers considering entry or expansion in China‟s mining sector.

Limited. The government imposes limitations and conditions on exploration and development of coal, barite, precious metals, phosphate, lithium, iron pyrite and some other non-ferrous metals.

Restricted. Foreign involvement is restricted in regard to tungsten, molybdenum, tin, antimony, fluorite, and rare earth mine and processing operations.

Again, these government policies are important to understand when considering potential opportunities for Australian CEE providers in the Chinese mining industry. While the part ownership or investment in mining or processing of some minerals is restricted, there are no restrictions on foreign firms providing services and technology to these mine operations to support environmental improvements.

2.2.2 Exchange listed companies and environmental disclosure

Approximately 200 mining and minerals companies are listed on the Shanghai Stock Exchange, accounting for almost 20 % of total market capitalisation. As part of listing requirements, these mining and minerals companies commonly adopt more diligent environmental management, monitoring and reporting than non-listed companies. They generally monitor and report on environmental management and policy, emission reduction, and energy saving in their annual

11 World Bank, 2011. Overview of State Ownership in the Global Minerals Industry.

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reports12. However, overall public reporting of environmental information is marginal and most companies tend to disclose only a small fraction of the information required to assess environmental performance.

Over 20% of Shanghai Stock Exchange listed mining and mineral companies have ISO 14001 certified environmental management systems13. Mining companies certified under ISO 14001 provide opportunities for Australian firms with experience in ISO 14001 auditing and associated process and management practices, which is required to ensure continuous environmental improvement.

In addition to companies listed on the Shanghai Stock Exchange, there have been several initial public offerings (IPOs) on international stock exchanges successfully carried out in the mining sector in recent years. Some of the major Chinese mining companies such as Zijin Mining (copper, gold), China Molybdenum Co (molybdenum), Jiangxi Copper (copper), Chinalco (aluminum), Shougang Iron and Steel Group (iron ore), China Minmetals (iron ore, rare earths, and others) are listed on stock exchanges in Hong Kong and abroad14. In most cases only minority share of such companies have been offered to the public and the government retains the majority. Companies listed on international stock exchanges generally strive for international best practice in environmental management and provide further opportunities for Australian CEE companies offering best practice approaches and technology.

2.3 Mining environmental performance and challenges

Examples of environmental impacts resulting from mine operations are frequently reported in local newspapers, some examples are provided in the following section. The environmental impacts associated with mining activities in China are similar to those which have occurred globally, and depend on the type of mineralization, development methods, environmental and geological conditions, and size and nature of mining enterprises.

Coal (open pit). Key environmental impacts caused by open pit coal development, which account for about 10% of the total coal mines in China, include: degradation of large areas of land, air pollution, impacts to slope stability, acid drainage, impacts to groundwater, regional groundwater drawdown, and issues associated with tailings storage facilities.

12 Dong, 2012. An Assessment of CSR Reporting Practice in China‟s Mining and Minerals industry. University of

South Australia.

13 Dong, 2012. An Assessment of CSR Reporting Practice in China‟s Mining and Minerals industry. University of

South Australia. 14 World Bank, 2011. Overview of State Ownership in the Global Minerals Industry.

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Coal (underground). Key environmental impacts caused by underground mining include: impacts to groundwater and water supply, land subsidence, and issues associated with tailings storage facilities.

Ferrous, non-ferrous, rare earths. Key environmental impacts caused by ferrous, non-ferrous mines, and rare earth mines are similar and include acid mine drainage and heavy metal pollution of water bodies and land (see Box 1). Metals contamination and acid drainage are also frequently related to discharge from tailing storage facilities. Failure of active and historic tailings dams is also a growing concern in China. An example is the tailings dam failure at the Yinyan Tin mine in September 2010 (see Box 2) which resulted in significant environmental and social impacts.

Box 1: Non-ferrous metals (manganese) pollution, Sichuan Province. Xiushan County, Sichuan Province boarding Hunan is rich in manganese ore, located in an area of China known as the „Manganese Triangle‟. In 2008, the County had 41 licensed manganese mines, and reportedly an additional 200 unlicensed mines in operation. The operations include open pit and underground mines, using blasting and excavation techniques to extract the ore. Manganese processing operations also exist within the county, requiring large qualities of water drawn from local groundwater aquifers. Many of the mining operations do not include tailings storage facilities or wastewater treatment, and as a result tailings waste and processing wastewater is discharged directly into rivers and onto land, contaminating surface water and groundwater. In June 2006, the Xiushan County EPB reported that the Wuling mine site was polluting rivers with wastewater containing 100 times the allowable levels of manganese.

Tightening regulations, enforcement and growing public concern, forced the issues to be addressed. The MEP and local EPB shut down several mining companies, including Wuling Mining, for environmental pollution of the local rivers, and have established a working group to mediate between the mining companies and local residents. Examples like these demonstrate that issues exist and the government is starting to enforce compliance with environmental legislation. Where mining companies face closure or fines, there is an increased motivation to adopt new technologies or services to improve environmental performance.

Box 2. Tailings Dam Failure, Yinyan Tin Mine, Guangdong. The Yinyan Tin Mine is located near Qianpai town, approximately 40 km east of Xinyi City, Guandong Province. The mine is currently under care and maintenance since failure of the projects tailings dam in September 2010, less than a year after completion in 2009 to a height of 48.5 m. The dam comprised predominantly fine rock-fill with coarse rock armouring over both faces and the crest. Following the failure during heavy rain events in September 2010, an area of approximately 1 km2 was inundated during the dam-break flood. The consequences from the failure included: (i) damage to infrastructure and clean-up costs estimated to be many CNY60 million, (ii) impact on regional surface water and groundwater supplies, (iii) loss of up to 300 jobs due to closure of the mine, potentially for more than 3 years while the dam is reconstructed, (iv) impact on fauna in downstream rivers, (v) loss of four lives, and (vi) damage to the mining company reputation.

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3. Regulations and motivation

Strengthened regulations and enforcement are a key motivation for mining companies to commission environmental services and technology to meet emission compliance requirements, and undertake remediation of historical contamination.

Since the implementation of the 11th FYP, the State has listed energy conservation and emission reduction as part of the objectives of national economic and social development, and mandated the targets of reducing the intensity of energy consumption, chemical oxygen demand and sulfur-dioxide emission. The 12th FYP has added reducing the intensity of carbon-dioxide emission and emission of ammonia nitrogen and nitrogen oxides to the list of mandatory targets.

Supporting strengthened environmental protection legislation in the China mining sector, the Government has released a series of standards and guidelines including (i) standards for mineral resource development 15 , (ii) guidelines on mine environmental management and restoration16, (iii) technical policy on mine environmental protection and pollution control17, and (iv) guidelines on ecological compensation18.

Appendix A provides a list of 47 Chinese laws, regulations and guidelines relating to environmental protection and management within China‟s mining and processing industry. The following section provides a summary of key laws and regulations.

3.1 Chinese laws

3.1.1 Mineral Resources Law

Administered by the MLR, the Mineral Resources Law (MRL) of the PRC governs the development of the mining industry by promoting exploration, development, utilisation and protection of mineral resources, and promoting environmental sustainable practices. With regard to environmental protection, the MRL requires that:

15 State Council, 2005. Announcement by the State Council concerning on the comprehensive rectifying and

standardizing mineral resources development [2005] No. 28 by State Council in China.

16 MoF, 2006. Guidance on establishment of mining environmental management and ecological restoration

mechanisms by Ministry of Finance, MLR, MEP, [2006] No. 215 by Ministry of Finance.

17 MEP, 2005. Mine environmental protection and pollution control policy, released by MEP, MLR and Ministry of

Health on September 2005.

18 MEP, 2007. Guidance on establishing pilot-scale ecological compensation sites [2007] No.130 by MEP.

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Exploration and development of mineral resources comply with China‟s environmental protection laws and regulations.

Land rehabilitation is required for impacts caused to arable lands, grasslands and forested areas. Associated regulations require rehabilitation including re-establishing native trees and grasses.

Compensation payments be made to affected people with regard to loss of land productivity or livelihood.

A mine closure plan be developed and approved by MLR, outlining engineering works, land contouring, contaminated waste remediation, and land rehabilitation.

3.1.2 Environmental Protection Law

Administered by the MEP, the Environmental Protection Law of the PRC requires an Environmental Impact Assessment (EIA) be undertaken and approved prior to a mining license being issued. For operational mines, the Environmental Protection Law requires that an Environmental Management Plan (EMP) be developed and implemented including an environmental monitoring program. The law specifies that mining operations must take effective measures to prevent environmental pollution caused by waste gas, wastewater, solid waste, dust, odor exhaust gas, radioactive substances, noise, vibration, electromagnetic radiation generated in the production, construction and other activities. The law assigns environmental responsibility to the mining company including requirement for public disclosure of environmental spills, corrective actions, remediation of environmental impacts, and compensation to affected people.

3.1.3 Water and Soil Conservation Law

The Water and Soil Conservation Law specifies environmental requirements for mining and processing operations with regard to soil and water quality (including groundwater), conservation, and rehabilitation. The law is supported by regulations, guidelines, and standards protective of soil and water beneficial uses. Pollution of surface water, groundwater and agricultural land has been identified as a significant issue associated with many mining operations in China, particularly with regard to heavy metals. As a result of tightening enforcement, non-compliance with the Law and associated regulations has resulted in fines and stop work notices served to several mining companies throughout China over the last few years (see Box 3).

3.2 Policies, regulations, and guidelines

3.2.1 Mine Environmental Protection and Pollution Control Technical Policy

The Mine Environmental Protection and Pollution Control Technical Policy was jointly released by the MEP, MLR and Ministry of Health (MoH) in 2005. The policy is administered by MEP and applies to environmental protection and pollution prevention over the lifecycle of the mine including planning, design, development, operation and closure. The policy is a key document with regard to environmental requirements for the mining industry and sets up objectives, principles and performance indicators for the mines in term of recycling and land rehabilitation. The policy lists restricted and prohibited activities for mine planning and design, and encourages best practice technologies and measures to be taken for mine design, mine construction, ore excavation and ore-dressing with regard to wastewater recycle, waste gas emissions, solid waste storage, solid waste reuse/recycling, integrated reuse of tailings, and closed mine rehabilitation.

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The policy provides a good guide for the future direction of the environmental protection services and technology needs in China‟s mining and processing industry, and should be used to focus the business strategies of Australian CEE companies.

The policy requires mining operations to implement the technical principles of a „circular economy‟ including:

Use of best practice technologies to achieve zero-impact or minimal-impact on the environment.

Use of zero-water or water-saving technology to reduce the amount of water required by operations.

Use of zero-emission or emission minimization technologies to reduce polluting emissions.

With regard to mining solid wastes, the policy presents a hierarchy: (i) direct reuse of metals or energy content of waste through use of advanced extraction or waste to energy technologies, (ii) recycle as building materials, and (iii) treatment and disposal.

With regard to these policy requirements, industry wide milestones were set in 2010 which should be achieved by 2015, including:

An increase of 3% from 2010 levels in the rate of water recycling for expansions, retrofits, and new built coal washing and ferrous metallurgy processing facilities.

An increase of 5% from 2010 levels in the rate of water recycling for all large and medium-sized coal mines.

An increase of 5% from 2010 levels in the rate of re-use of tailings waste.

An increase of 45% from 2010 in the rate of land rehabilitation of historic mine sites.

The policy encourages mining operations to adopt principles of cleaner production, encouraging adoption of best practice technologies and approaches.

The policy provides further details on approaches to water conservation and recycling, solid waste storage and reuse, and land rehabilitation, along with measures to protect against pollution release.

3.2.2 Mine Geotechnical Regulation

The Mine Geotechnical Regulation is administered by the MLR and requires a geotechnical assessment and land rehabilitation plan to be prepared and approved prior to the issue of a new mining license. The regulations stipulate that the plan must include: mine profile, mine geological environment conditions, assessment of the potential impact on slope and land stability including a geotechnical hazard analysis, measures to be taken to address slope stability issues, monitoring plan, cost estimates, and a letter of commitment of funds to undertake the plan.

3.2.3 Mine Closure Rehabilitation Technical Guideline (in preparation)

MEP is currently preparing for a Mine Closure and Rehabilitation Technical Guideline. Currently in draft form, it is expected to be finalised in 2013, and will include specifications for mine site rehabilitation. This may create further opportunities for Australian CEE providers who have experience with mine closure in Australia.

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3.3 Regulatory enforcement

Enforcement of regulations is a key aspect driving the required environmental improvements in China‟s mining industry and underpinning demand for clean energy and environmental technologies. Enforcement of regulations has improved in China over the past decade, with growing public awareness and concern of environmental pollution impacts. As demonstrated in the case study example in Box 3, the government is taking a strong line in enforcing environmental regulations by closing unlicensed mining operations, halting non-compliant operations and taking steps to consolidate the mining industry to allow more efficient regulation. MEP and MLR have indicated that this trend in increasing regulatory enforcement is likely to continue, with environmental performance indicators becoming a key aspect in evaluation of provincial and municipal level government performance. Increases in regulatory enforcement and consolidation of the mining industry will see further opportunities emerge for environmental best practice approaches and technologies in the mining industry.

Box 3: Inner-Mongolia Land and Resource Bureau halts hundreds of mines operations. The China Daily, a local newspaper, reported that authorities in North China's resource-rich Inner Mongolia halted 467 illegal mining projects in 2011 in a region-wide crackdown aimed at safety and environmental protection in the mining sector. The regional Land and Resources Bureau undertook inspections at about 9,000 mining facilities, halting 467 illegal projects and ordering 887 licensed mines to suspend operations until environmental and safety compliance could be achieved.

The inspections were part of a broader push in Inner Mongolia to overhaul the mining sector. The efforts of the Land and Resources Bureau are being supported by the regional Coal Mine Industry Bureau which has strengthened its role as a work safety watchdog increasing supervision of coal mines to ensure safe production practices and protection of the environment.

3.4 Government initiatives and programs

Several initiatives and funds have been set up to support the strengthened legislation, enforcement and overall push to improve the environmental performance of the China mining sector. These funds and initiatives provide further motivation for adoption of environmental best practice approaches and technologies in the mining industry, and may present opportunities for Australian CEE companies. Two key initiatives are detailed below.

3.4.1 Green Mine initiative

The Green Mine initiative became effective in 2010 under the MLR and is administered by the China Mining Federation. It is aimed at improving the environmental performance of the mining industry in China by incorporating environmental principles into the lifecycle of mine development and closure. Based around a Green Mine standards published by the MLR in 2010, the initiative requires companies to: Comply with Chinese laws, rules and regulations relating to mining license, mineral resources planning and development, environmental protection, pollution remediation, and land rehabilitation.

Establish a management system with regard to resources development, mining operation, environmental protection, safety and quality assurance.

Ensure mining recovery ratio and resources recycling rate are within industry best practice standards and in accordance with the China mine environmental protection and pollution control technical policy.

Demonstrate technical innovation and use of best practice technology, upgrade of inefficient technologies, equipment and process, and use „environmentally friendly‟ technologies. Expenditure on technical innovation is greater or equal to 1% of annual

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production revenue.

Demonstrate energy saving and pollutant emission reduction approaches have been adopted. Emission volumes of greenhouse gasses, wastewater and solid waste contaminants are in accordance with industry best practice, and wastewater recycling rates are between 90% and 100%.

Establish an environmental protection fund and ensure overall potential environmental impacts associated with operations are being managed under an environmental management plan.

Rehabilitate land in stages of mining design and production. It is required that the land rehabilitated be integrated with the staged approach to excavation development and closure.

Demonstrate good social responsibly and support for local community livelihoods.

Demonstrate a corporate culture which actively implements the corporate strategy for sustainable mine practices.

The China Mining Federation indicated that mines receiving Green Mine certification will benefit from improved reputation, acknowledgement of good practice, and receive national and local preferential policies in terms of mineral resources allocation, financial incentive, subsidy, bank loan and taxation. The China Mining Federation also indicated that some Provinces (un-named) have stated that mining operations may be closed down if they cannot reach the Green Mine standards within a certain timeframe. Other Ministries including the MOF, MEP and MoH are providing their support for the program.

Since 2010, a total of 220 mines have received Green Mine certification under the program (listed in Appendix B). The MLR expects that by 2020 all large and medium sized mines will be certified, representing around 1,500 mining facilities (around 15% of the total number of mines). The Green Mine application and appraisal is carried out once a year. Each Province is asked to submit 5 to 10 mining company as applicants each year. Examples of Shandong Gold‟s and Beijing Haohua Energy Company‟s push to gain certification of their mining operations is summarised in Box 4 and Box 5.

Box 4: Shandong Gold Group. Shandong Gold Group has three mine facilities that received Green mine certification under the first batch of Green Mines under the national program; Xincheng Gold Mine, Sanshan Island Gold Mine and Guilaizhuang Mining Company (all part of the Shandong Gold Group). In January 2012, the MLR announced the second batch of Green Mines in which their Hongling Lead-Zinc Mine and Jinqingding Mine were nominated.

Since the 11th FYP, the Shandong Gold Group has taken steps to adopt international best practice technologies and approaches, including adopting a „double zero‟ objective with regard to safety and environmental compliance. The Shandong Gold Group corporate policy supports innovation in environmental technologies and new ideas and approaches to mine design, management and operation. Their innovation and environmental objectives are based on:

(i) Exploring innovative and environmental sustainable ways to expand their operations.

(ii) Improving environmental and safety performance of existing mine operations, including adopting the objective of zero net impact.

(iii) Strengthening the environmental risk management and mitigation framework at all operations.

The Shandong Gold Group have publically expressed its commitment to „comprehensively promote the transformation and upgrade of mines through innovation and technical progress, and fully create a green and ecological mine with resource conservation and high-efficient development‟.

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Box 5: Beijing Haohua Energy Company. Five mine facilities under the Beijing Haohua Energy Company Ltd were recommended by Beijing Municipal Bureau of Land and Resources for Green Mine certification in 2011. Following evaluation by the MLR, approval for certification was received in April 201219.

The Beijing Haohua Energy Company has 38 mines facilities located in Beijing. It plans to achieve Green Mine certification for all 38 operations in the coming years, with plans „to enhance the exploration and utilisation of the mineral resources, to promote the social and economic development, and to advance the coordinated development of ecology and environment‟. Its goal is to gradually increase the percentage utilisation of resources, adopt best practice mining approaches, improve the environmental performance of their production processes, and develop standardised environmental management plans and implement post-mine closure rehabilitation.

3.4.2 National Heavy Metals Pollution Remediation Program

As part of the 12th FYP, the State Council approved a national program for heavy metal pollution remediation. Backed by a commitment of CNY 75 Billion, the program focuses on reducing emissions and remediating historic contamination associated with five key metals: mercury, chromium, cadmium, lead and arsenic, all of which can be associated with mining operations. The program has listed over 4,000 target companies in five industry sectors: mining, smelting, lead-acid battery manufacturing, leather processing, and chemical processing. The program covers 14 provinces, namely Inner-Mongolia, Jiangsu, Zhejiang, Jiangxi, Henan, Hubei, Hunan, Guangdong, Guangxi, Sichuan, Yunnan, Shaanxi, Gansu and Qinghai, and 138 sites and facilities have been identified in an initial screen. The list of the 138 site and facilities was not made available for this study.

Companies and local governments have been encouraged to develop feasibility studies for submission, with an initial focus on Hunan and Gansu in 2011. Project applications are considered and approved by the NDRC. In many cases inclusion of international companies and technologies has been encouraged as part of the feasibility study design process, to capture international best practice in approaches to remediation. For example, several international companies including Australian CEEs have been involved in project feasibility study development for 12 proposals to NDRC in Hunan, under the Xiangjiang River Basin Pilot Project. Some of these projects have been undertaken as joint ventures between local and international firms.

19 Notification of the Ministry of Land and Resources on the Second Batch of National Green Mining Pilot Units No.8,

April, 2012.

19

The National Heavy Metals Pollution Remediation Program presents considerable opportunities for Australian CEE companies. The roll-out to the other 12 provinces should be monitored closely for future opportunities. Reports indicate that there are at least 10 upcoming projects under the program; however information on only two of these was received by this study for projects in Inner Mongolia (see Section 4.1.1).

20

4. Potential opportunities

The Chinese mining industry uses several technologies and services from international companies. For example, the China coal industry imported over CNY 24 Billion in mining equipment in 2011, the majority from Japan and South Korean (1.5 % was imported from Australia)20. With regard to clean energy and environmental services and technology, research shows that this is an increasing area of demand within the mining sector. International best practices and innovative solutions are being encouraged and adopted by Chinese mining companies to meet new and increasingly stringent government requirements, achieve „green‟ certification and reach global standards required by international stock exchange and financial institutions. These developments present opportunities for Australian companies offering international best practice solutions and services.

Based on the findings from this study, the following areas may present potential for Australian CEE companies:

Advanced approaches to tailings management and remediation, with the aim to both remediate and recover metals in a cost-effective way.

Innovative approaches to reuse of waste-rock as an alternative product.

Stabilization approaches for heavy metals in sediment and solid wastes.

Dust control approaches and technologies in underground mining operations.

Advanced wastewater monitoring, treatment and resource extraction technologies such as (i) rapid field analytical technologies, particularly for acid mine drainage, (ii) approaches and technologies able to recover metals from wastewater, and (iii) innovative industrial wastewater treatment approaches and technologies.

Innovative approaches to land rehabilitation and re-vegetation in areas contaminated with heavy metals, including joint formulation of mine rehabilitation plans or schemes. Several interviewees involved in this study noted that international experience would be beneficial in introducing advanced concepts, ideas and methodologies.

Innovative approaches to reduce the volume of tailings produced.

Environmental impact assessment services to bridge the gap between Chinese EIA standards and EIA requirements of international financing institutions or listing on an international stock exchange. For example, GHD Pty Ltd, an Australia Consulting Company, is working with Chinese mining clients to provide due diligence assessment of locally approved EIAs and supplementing with additional information to meet International Finance Corporation (IFC) guidelines and the Equator Principles required by international financing institutions.

20 Austrade, 2012. http://www.austrade.gov.au/Mining-to-China/default.aspx

21

In addition, there appears to be a need for strengthening overall environmental management systems and management of rehabilitation programs. These may be best undertaken through training and capacity building forums which may be supported by government. For example, Earth Systems Pty Ltd, an Australian Consulting Company supported the first International Acid and Metalliferous Drainage Workshop in China, held in Beijing in December, 2012. The workshop provided a forum for capacity building and exchange of ideas on leading practice management strategies for heavy metal pollution and acid mine drainage. It also built awareness and capacity in the need for assessment and development of appropriate strategies prior to implementation of acid mine drainage remediation programs.

4.1 Funding for environmental projects in mining industry

4.1.1 Government programs

There are several government funded programs which cross over into environmental aspects of the mining industry managed by the different Ministries. This includes the MEP focusing on heavy metal pollution management, the MRL focusing on land rehabilitation, the Ministry of Science and Technology (MOST) focusing on technology innovation, and the NDRC focusing on regionally large and multi-functional programs such as the pollution treatment in the Xiang Jiang River Heavy Metal Pollution Remediation Program in Hunan.

With regards to opportunities for Australian CEE companies, two specific government programs show the most promise.

Research and development funds. Each Ministry administers its own research and development fund allocated for „significant, genetic or critical‟ new technologies or provision of new policies, guidelines or standards, which may be applied to environmental improvement and management in the mining sector. Government agencies or research institutes can apply to the Ministries for R&D funding with a research project proposal. Eligible projects are divided into domestic projects and projects with international cooperation. An example of a project involving international cooperation with an Australia company is the Beijing Research Institute of Mining and Metallurgy (BGRIMM), which in cooperation with the Mining Land Restoration Center, University of Queensland, is conducting two R&D projects in the mining sector: (i) Environmental Management and Technologies for Typical and Large Bulk of Solid Wastes, to be funded with CNY 8 million by MEP, and (ii) Acidic Water Source Control for Typical Solid Wastes to be funded with CNY 4.5 million by MOST. Further information of these examples is provided in the following case study section.

This type of funding sources provides an opportunity for Australian CEE companies to develop and pilot their technologies and approaches in China, and gain access to the local mining sector market. Australian CEE companies must partner with a Chinese agency or institute to develop and submit a proposal for funding. It is recommended that the areas listed above, which present potential for Australian CEE companies, would be suitable target areas for application for R&D funding.

National Heavy Metal Pollution Remediation Program. As outlined in previous sections, the State Council has approved a CNY 75 Billion national program for heavy metal pollution remediation, which is in line with priorities of the 12th FYP. This program presents significant opportunities for Australian CEE companies to partner with local companies and design institutes to design and deliver heavy metal pollution reduction and remediation programs throughout 14 Provinces within the program. International involvement has been encouraged in the initial stage of the program in Hunan, and Australian companies including GHD Pty Ltd, Earth Systems Pty Ltd, OTEK Pty Ltd and

22

Dolomatrix Pty Ltd, have been involved in project design and implementation works under this program. A case study example of Earth Systems project involvement is provided in the following section.

The Beijing General Research Institute of Mining and Metallurgy (BGRIMM) highlighted two opportunities funded under the National Heavy Metal Pollution Remediation Program proposed for Inner Mongolia. Initial feasibility studies have been developed for (i) comprehensive remediation of an iron ore tailing dam in Hugangang County, and (ii) remediation of abandoned tailing in Balinzou County, both in Chifeng City, Inner-Mongolia.

The feasibility studies have been submitted to the NDRC and MEP for review and approval for funding under the National Heavy Metal Pollution Remediation Program. If approved, the remediation projects may represent opportunities for Australian CEE companies to support advanced approaches to tailings remediation and mine closure. The following provides information on each opportunity.

(a) Comprehensive remediation of an iron ore tailing dam in Hugangang County. The iron ore tailings dam was built in 1996 by the Huanggang iron ore mine to cope with the production capacity of 500t/d. During 1996-2006 the mine treated 1.5 million tons of raw iron ore and produced 0.5 million tons of iron ore concentrates so that 1 million tons of tailings were piled in the tailings dam. The dam was abandoned several years ago, and contains high volume of arsenic. Long time piling without treatment would cause water pollution and may threaten the down-stream lake ecosystem and beneficial uses. The feasibility study has recommended developing detailed approach to tailings remediation.

(b) Remediation of abandoned tailings in Balinzuo County. The tailings dam was built by the Jinyu mining company. Before the mine went out of business, the company had operated for 11 years and generated 1.69 million tons of tailings. The tailings pond was poorly designed and constructed by the company itself. The seepage proofing facilities are imperfect and caused seepage flow of waste water. The heavy metal in the tailings polluted water and soil. The ore sand polluted the air and land. There is potential danger of dam break during the flood season.

In addition, 25 projects have been proposed in Chenzhou Municipality, in Hunan Province under the National Heavy Metal Pollution Remediation Program 21 . The proposed projects have a total estimated budget of almost CNY 2 Billion including CNY 414 Million allocated from the National Heavy Metal Pollution Remediation Program. The list of proposed projects could not be made available for this study, and further

21 Hunan Mine Network, 2012

23

assessment is required to evaluate these specific opportunities. Chenzhou Municipality is known as „China‟s Non-ferrous Metal Land, with over two thirds of the Hunan‟s Provincial non-ferrous metal reserves. It ranks number one in China for tungsten and bismuth reserves, number three for tin and number four for zinc.

It is recommended that further information be sought on these and other opportunities under the National Heavy Metal Pollution Remediation Program, and how Australian CEE companies may be involved. It is important to gain early involvement in project development to increase the success rate of securing service or equipment contracts.

4.1.2 Company funded opportunities

The study has found that larger mining companies within China are seeking innovative approaches and technologies to address their environmental compliance requirements. As with any business, the approaches and technologies must provide highly cost efficient solutions to their problems.

Most commonly, large mining companies seeking funding from international financing institutions or preparing for IPO on an international stock exchange will contract an international services firm to undertake due diligence assessment.

Opportunities also exist for technology providers, however further market research is required to match specific Australian CEE technologies with Chinese mining sector needs.

A large selection of environmental impacts in China‟s mining sector result from small sized mining operations, some of which are not licensed. In general, small sized mining companies are not recommended as targets for provision of services and equipment from Australian CEE companies.

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5. Case studies

The following provides a brief summary of five case study examples of Australian CEE companies involved in the China mining sector, including:

Tailing storage facility assessment in Hunan Province, undertaken by Earth Systems Pty Ltd.

Technical Due Diligence Assessment on five mine sites for international financing approval requirements undertaken by GHD Pty Ltd.

Mine wastewater treatment in Yunnan Province, undertaken by Creative Water Technologies an Australian water treatment technology company.

Environmental management and technologies for mine solid waste management - Queensland University

Mine wastewater treatment in Jiangxi Province, undertaken by BioteQ a Canadian water treatment technology company.

Tailings storage facility assessment, Hunan province. Located at the upstream of the mother river (Xiangjiang River) in the Hunan province, Chenzhou is now facing considerable challenges with mines sites in the area. Hydrochina Zhongnan Engineering Corporation (HCZEC) commissioned Earth Systems to provide environmental consulting services for the Chenzhou Xintianling Mine Site Engineering Procurement and Construction Management Project (Xintianling Project), which was partly funded under the National Heavy Metal Pollution Remediation Program. The decommissioned tailing storage facilities associated with the Xin Tian Ling tungsten mining area posed a potential hazard to water quality, human health and safety, and agricultural productivity in the regions surrounding and downstream of these facilities.

The project provided preliminary assessment of geotechnical and geochemical risks and rehabilitation options of six decommissioned tailing storage facilities. The main activities include: (i) geotechnical stability assessment, (ii) identification of potential rehabilitation options, (iii) identification of further data required to aid in the selection of appropriate site-specific rehabilitation options, and provision of recommendations for rehabilitation of the six tailings storage facilities.

Earth Systems is currently seeking opportunities in China for mining applications of its advanced acid drainage treatment technology known as Neutra-Mill, and its unique approach to preventing acidic drainage from underground workings, known as GaRDS Gas Redox and Displacement System (GaRDS) The GaRDS approach was jointly devised and developed by scientists at Earth Systems and ANSTO's Environmental Chemistry Division (an Australian federal government research agency).

Technical due diligence assessment on five mine sites for international financing approval requirements. GHD was engaged to undertake a due diligence review of five mine sites for a confidential client in accordance with the International Finance Corporation (IFC) Environmental Health and Safety Guidelines for Mining. The mines included a Gold and Copper Mine in Fujian, a Tin Mine in Guandong, a Gold Mine Guizhou, a Copper Mine in Qinghai, and a Zinc Mine in Inner Mongolia. The assessment identified gaps between local practices and international best practices and provided supporting recommendations to bring the mines in line with international requirements.

Rare earth processing facility wastewater treatment, Yunnan province. Creative Water Technologies is working with a confidential client in the Yunnan province to develop wastewater treatment options for a rare earth processing facility. The opportunity has developed from

25

mineral processing facilities struggling to meet environmental discharge limits and receiving increasing pressure from the local Environmental Protection Department. Further opportunities are arising from companies seeking to achieve zero liquid discharge and increase the recycling of wastewater in line with the China Mine Environmental Protection and Pollution Control Technical Policy (see Section 3.2.1).

The Creative Water technology includes a world-class technique for wastewater treatment, resulting in Zero Liquid Discharge (ZLD) and fractional crystallisation of minerals. The technology is able to reclaim up to 97% clean usable water and up to 100% of the contaminants contained in the feed water. It is most applicable in difficult to treat wastewater especially with high concentrations of contaminants.

Improved approaches to mine waste management. The University of Queensland‟s Centre for Mined Land Rehabilitation (CMLR) partnered with BGRIMM to gain funding from the Chinese Ministry‟s R&D program to undertake two joint projects aimed at improving approaches to mine waste management and treatment. The first project – Environmental Management and Technologies for Typical and Large Bulk of Solid Wastes – is to be funded by the MEP to the tune of CNY 8 million. BGRIMM will collaborate with CMLR to provide policy recommendations on the issue by reviewing the current best technologies in treating certain elements such as copper tailings, lead and zinc tailings, manganese waste, phosphogypsum, red mud, etc. The second project – Acidic Water Source Control for Typical Solid Wastes – is to be to funded with CNY 4.5 million by MOST and also undertaken in collaboration CMLR.

Mine wastewater treatment in Jiangxi province. BioteQ operates a water treatment plant at the Dexing Mine, an active copper mine in China, in a 50-50 joint venture with Jiangxi Copper Company. The plant applies BioteQ‟s ChemSulphide® process to treat wastewater produced by mine drainage from waste dumps and low grade stockpiles, removing dissolved copper and ferric iron, and producing treated water that is re-used at the mine site. BioteQ has operated the plant on behalf of the joint venture since early 2008, which has a capacity of 1,000 m3/h. Annual production capacity is expected to gradually ramp up to 3.6 million pounds of copper. Design and construction of a second water treatment circuit is underway at the site, featuring a novel ion-exchange process developed by BioteQ to concentrate dissolved cobalt and nickel for recovery.

BioteQ‟s water treatment processes deliver lower life cycle costs for water treatment, and enhance environmental performance at the Dexing site. For example, in 2009, the Dexing plant treated 5.5 million litres of water and removed close to 1.7 million pounds of copper from the environment. The plant generated an operating profit for the joint venture, while delivering economic and environmentally sustainable benefits.

Construction of the plant improved overall site water management and protected an important wetland from heavy metal pollution. BioteQ has also assisted the owner with the design and operation of two high density sludge lime plants on the large site.

The Dexing water treatment plant won the 2008 China Mining Environmental Protection Award, recognizing BioteQ‟s sustainable technology and Jiangxi Copper Company‟s leadership in protecting and preserving the environment.

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6. Priority opportunities and

recommendations

Several favourable areas for Australian CEE providers of services and equipment have been identified as part of this study. Four priority areas for follow up action are recommended:

Opportunities under the National Heavy Metal Pollution Remediation Program in Inner-Mongolia. This study has highlighted significant diversified mining industry operations in Inner-Mongolia and several environmental challenges facing the industry. Government regulators have increased pressure on mining companies, resulting in stop work notices issued to almost 900 operations as a result of non-compliance with environmental (and safety) laws. The National Heavy Metal Pollution Remediation Program includes Inner-Mongolia as a focus area, and at least two projects have been submitted for central government funding. Based on this assessment, Inner-Mongolia is considered to have high potential for opportunities for Australian CEE companies. It is recommended for further targeted market research and specific opportunities evaluation. To further assess this opportunity, it is recommended that discussions be held with the Inner-Mongolia Development and Reform Commission, Environmental Protection Department and Land and Resource Department to identify key issues and opportunities in the Province as an initial next step. Interested Australian CEE companies may consider establishing meetings with these regional agencies which would help to target specific opportunities. It appears that the opportunities are current and it is recommended that next steps be taken within 6 months to ensure Australian CEE companies initiate contact at an early stage of project development.

Opportunities under the National Heavy Metal Pollution Remediation Program in the Hunan Province. Hunan has been the initial pilot Province of the National Heavy Metal Pollution Remediation Program, under which several Australian CEE companies have already been involved. The Hunan Government has indicated that 25 projects have been proposed in the Chenzhou Municipality22 with a total estimated budget of almost CNY 2 billion including a CNY 414 million allocation from the National Heavy Metal Pollution Remediation Program. However, a list of proposed projects and their details could not be obtained for this study.

22 Hunan Mine Network, 2012

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Based on this assessment, Hunan is considered to have high potential opportunities for Australian CEE companies and it is recommended that further investigation be undertaken into the specific project opportunities in Hunan and matched with Australian CEE capabilities and technologies.

Opportunities in tailings storage facility management and rehabilitation. This study has shown there are over 1,600 tailings storage facilities throughout China. While there have been significant advancements in tailings storage facility design in recent decades along with strategies to prevent and mange associated heavy metal pollution, there remains a legacy issue from old and abandoned tailings storage facilities which is yet to be comprehensively addressed in China. Under the Mine Environmental Protection and Pollution Control Technical Policy, The MEP requires an increase of 45% of rehabilitation of historic tailings sites based on 2010 levels. In addition, research and development of new approaches tailings management is an area where the China government is encouraging foreign investment and cooperation. This study has highlighted opportunities for Australian CEE companies in areas of (i) improved tailings storage facility management including approaches to assessment and water treatment, as well as (ii) provision of services and technology for remediation and rehabilitation of historic tailings sites. For some historic tailings waste, advanced technologies resource recovery may also be suitable. Australian CEE companies have already engaged in this area and demonstrated enthusiasm for developing further opportunities. It is recommended that a detailed assessment of specific opportunities in tailings storage facility management be undertaken and awareness raising activities be held with MEP and MLR to raise the profile of Australian companies in this specific area.

Requirements for international best practice environmental assessment. The study has identified that Chinese mining companies requiring international best practice to comply with overseas stock exchange or international financial institution requirements often contract international service providers. Over 20% of Shanghai Stock Exchange listed mining and mineral companies have ISO 14001 certified environmental management systems. Mining companies certified under ISO 14001 provide opportunities for Australian companies with experience in ISO 14001 auditing and associated process and management practices. In addition to companies listed on the Shanghai Stock Exchange, there have been several initial public offerings (IPOs) on international stock exchanges successfully carried out in the mining sector in recent years, such as Zijin Mining (copper, gold), China Molybdenum Co (molybdenum), Jiangxi Copper (copper), Chinalco (aluminum), Shougang Iron and Steel Group (iron ore), China Minmetals (iron ore, rare earths, and others). Companies listed on international stock exchanges generally strive for international best practice in environmental management and provide further opportunities for Australian CEE companies offering best practice approaches and technology. Australian CEE companies are already targeting this area with Chinese mining companies with some success. These opportunities may be further enhanced with a seminar inviting environmental managers from China‟s top 100 listed mining companies to hear Australian perspectives on technologies, processes and solutions.

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Appendix A

Appendix B

Appendix A: Relevant Environmental Legislation

29

Category Name Issue Authority Date

Law

Constitution of the PRC The 5th NPC 4 Dec 1982

Law of the PRC on Prevention and Control of Water Pollution

The 6th Standing Committee of

National People‟s Congress (NPC) 1 Nov 1984

Mineral Resources Law of the PRC

The 8th Standing Committee of NPC 1 Jan 1997

Land Administration Law of the PRC

The 9th Standing Committee of NPC 1 Jan 1999

Law of the PRC on the Prevention and Control of Atmospheric Pollution

The 6th Standing Committee of NPC 1 June 1988

Environment Protection Law of the PRC

The 7th Standing Committee of NPC 26 Dec 1989

Law of the PRC on Water and Soil Conservation

The 7th Standing Committee of NPC 29 June 1991

Law of the PRC on Safety in Mines

The 7th Standing Committee of NPC 1 May 1993

Law of the PRC on Prevention of Environmental Pollution Caused by Solid Waste

The 8th Standing Committee of NPC 1 April 1996

Law of the PRC on the Coal Industry

The 8th Standing Committee of NPC 1 Dec 1996

Law of the PRC on Prevention and Control of Pollution From Environmental Noise

The 8th Standing Committee of NPC 1 Mar 1997

Law of the PRC on Environmental Impact Assessment

The 9th Standing Committee of NPC 1 Sep 2003

National Regulation

The Provisional Measure of Charging Pollutant Discharge Fee

The State Council 1 July 1982

Decision of the State Council on Works of Environmental Protection

The State Council 8 May 1984

State Council‟s Provisions to Enhance the Environmental Protecting Management for the

Enterprises Owned by Villages，Towns and City Communities

The State Council 27 Sep 1984

Interim Provisions on the Comprehensive Utilization of Resources

The State Council 30 Sep 1985

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The Provisional Measure of Supervision and Management of Mineral Resources

The State Council 29 April 1987

The Provisional Measure of Compensation Use of Pollution Sources Treatment Special Fund

The State Council 1 Sep 1988

Regulation of Land Reclamation The State Council 1 Jan 1989

Decision of the State Council on Further Strengthening the Environmental Protection

The State Council 5 Dec 1990

Tailing Pollution Prevention Regulation

The State Council 1 Oct 1992

Township Coal Mine Management Regulation

The State Council 20 Dec 1994

Management Measure of Coal Production License

The State Council 20 Dec 1994

Some Opinions of the State Council on Promoting the Sound Development of the Coal Industry

The State Council 7 June 2005

General Office of the State Council about accelerating coal-bed methane (coal ) extraction using several opinions

The State Council 15 June 2006

Notice on the retention measure of profit from comprehensive use of "three wastes" pollution managed by mining enterprises

Ministry of Finance, Environment Protection Leading Group of the State Council

30 Dec 1979

Notice on additional budget item for sewage charges

Ministry of Finance 9 April 1982

Regulation on Administration of National Environmental Monitoring

Ministry of Urban and Rural Construction and

Environmental Protection

21 July 1983

Financial management and accounting methods for imposition of the fee for excess pollutant discharge

Ministry of Urban and Rural Construction and

Environmental Protection, Ministry of Finance

1 July 1984

Notice on the provisions of the environmental protection funding sources

Ministry of Housing and Urban-Rural Development, State Planning Commission, State Scientific and Technological Commission, State Economy Commission, Ministry of Finance, China Construction Bank, Industrial and Commercial Bank of China

10 June 1984

31

Divisional Regulation

Implementing Provisions Concerning Examination of Environment Protection of Industrial Enterprises (Trial)

Environmental Protection Commission under the State Council, State Economy Commission

30 June 1985

Regulations on the Administration of Construction Project Environmental Protection

Environmental Protection Commission under the State Council, State Planning Commission, State Economy Commission

20 Mar 1987

Water Pollutant Discharge Permit Management Interim Measures

State Bureau of Environmental Protection

22 Mar 1988

Supervision and Management Measures for Environmental Protection of Sewage Treatment Facilities

State Bureau of Environmental Protection

9 May 1988

Pollution Control Regulations of Drinking Water Protected Areas

State Bureau of Environmental Protection, Ministry of Health, Ministry of Construction, Ministry of Water Resources, Ministry of Geology and Mineral Resources

10 July 1989

Measures for the Administration of the Environmental Impact Assessment Certificate for Construction Project

State Bureau of Environmental Protection

2 Sep 1989

Provisions of Implementing “Three Simultaneities” for the Resources Comprehensive Utilization Project, New Construction and Expansion Project

State Planning Commission 1 Jan 1990

Measures for Geological Disaster Prevention and Management

Ministry of Land and Resources 2 Mar 1999

On the Work of Strengthening the Harness of Geological disasters

Ministry of Land and Resources, Ministry of Construction

12 May 2001

Mine Ecological Environmental Protection and Pollution Control Policy

State Bureau of Environmental Protection, Ministry of Land and Resources, Ministry of Health

7 Sep 2005

Notice on Strengthening the Management of Coal Infrastructure Project

Ministry of Land and Resources, The People‟s Bank of China, State Bureau for Industrial and Commercial Administration, General Administration of Quality

Supervision ， Inspection and

Quarantine, State Bureau of Environmental Protection, State Administration of Work Safety

8 Dec 2005

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Official Reply on Planning of Large Coal Mine Bases

National Development and Reform Commission

2 Mar 2006

Guidance on accelerate the structural adjustment of coal industry, deal with over capacity

National Development and Reform Commission

10 April 2006

Guidance on gradual establishment of the accountability mechanisms of mine environment protection and ecological restoration

Ministry of Finance, Ministry of Land and Resources, State Bureau of Environmental Protection

10 Feb 2006

Mine Geological Environmental Protection Regulation

Ministry of Land and Resources 1 May 2009

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Appendix B: 2010 Green Mines

34

首批国家级绿色矿山试点单位名单

一、煤炭（11 个）

同煤大唐塔山煤矿

中国神华能源股份有限公司上湾煤矿

神华准格尔能源有限责任公司黑岱沟露天矿

神华宁夏煤业集团有限责任公司灵新煤矿

新汶矿业集团有限责任公司华丰煤矿

兖州煤业股份有限公司济宁三号煤矿

兖州煤业股份有限公司兴隆庄煤矿

山东泰山能源有限公司协庄煤矿

山东泰山能源有限公司翟镇煤矿

白山市振东煤业有限责任公司东晋煤矿

郑州磴槽企业集团金岭煤业有限公司金岭煤矿

二、黑色金属（5 个）

首钢水厂铁矿

首云矿业股份有限公司首云铁矿

北京云冶矿业有限责任公司冯家峪铁矿

北京威克冶金有限责任公司巨各庄铁矿

山东兴盛矿业股份有限公司杨庄铁矿

三、有色金属（5 个）

中国铝业股份有限公司广西分公司平果铝土矿

金川集团有限公司龙首矿

金川集团有限公司二矿区

江西铜业股份有限公司德兴铜矿

金堆城钼业股份有限公司金堆城钼矿

四、黄金（6 个）

山东黄金矿业股份有限公司三山岛金矿

贵州锦丰矿业有限公司锦丰（烂泥沟）金矿

招金矿业股份有限公司夏甸金矿

招金矿业股份有限公司金翅岭金矿

山东黄金矿业股份有限公司新城金矿

山东省平邑归来庄金矿

五、化工（7 个）

贵州开磷（集团）有限责任公司开阳磷矿

云南磷化集团有限公司昆阳磷矿

云南磷化集团有限公司海口磷矿

中盐金坛盐化有限责任公司金坛盐矿

敦煌西域特种新材股份有限公司西湖芒硝矿

湖北神农磷业科技股份有限公司莲花-简城磷矿

湖北神农磷业科技股份有限公司寨湾磷矿

35

六、建材（3 个）

湖州新开元碎石有限公司（建筑石料矿）

湖州鹿山坞矿业有限公司妙西镇第十矿区

北京水泥厂有限责任公司凤山矿

第二批国家级绿色矿山试点单位名单 北京：

1.北京昊华能源股份有限公司大安山煤矿

2.北京昊华能源股份有限公司木城涧煤矿

3.北京密云县放马峪铁矿

4.北京建昌矿业有限责任公司太师屯铁矿

5.北京市长流水采石场

河北：

1.河北冀中能源峰峰集团有限公司梧桐庄矿

2.河北冀中能源邯郸矿业集团云驾岭煤矿

3.河北冀中能源股份有限公司东庞煤矿

4.河北冀中能源股份有限公司邢东煤矿

5.河北钢铁集团滦县司家营铁矿有限公司（司家营铁矿）

6.河北滦平金锴矿业有限公司（周台子铁矿）

7.河北钢铁集团矿业有限公司庙沟铁矿

8.河北易县葡萄山铁选厂野鸭沟铁矿

9.河北金厂峪矿业有限责任公司（金厂峪金矿）

10.河北张家口弘基矿业有限责任公司黄土梁金矿

11.开滦（集团）有限责任公司唐山矿业分公司（唐山煤矿）

河南：

1.河南神火煤电股份有限公司新庄煤矿

2.河南大有能源股份有限公司常村煤矿

3.河南平顶山天安煤业股份有限公司一矿

4.河南省正龙煤业有限公司城郊煤矿

5.河南洛阳栾川钼业集团股份有限公司三道庄钼矿

6.河南发恩德矿业有限公司洛宁县月亮沟铅锌银矿

7.河南灵宝市金源矿业有限责任公司金源二矿

8.河南灵宝黄金股份有限公司灵金一矿

9.河南嵩县金都矿业有限责任公司萑香洼金矿

10.河南嵩县丰源钼业有限责任公司雷门沟钼矿

山东：

1.山东新巨龙能源有限责任公司（龙固煤矿）

2.山东龙口煤电有限公司北皂煤矿

3.山东泰丰矿业集团有限责任公司王家寨煤矿

4.山东济矿鲁能煤电股份有限公司阳城煤矿

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5.山东聚源矿业集团有限公司聚源煤矿

6.山东金岭矿业股份有限公司召口矿

7.山东莱芜钢铁集团莱芜矿业有限公司马庄铁矿

8.山东金洲矿业集团有限责任公司金青顶(金)矿区

9.山东美银膏业有限公司左庄石膏矿

10.山东烟台宜陶矿业有限公司李家夼(长石)矿区

广东：

1.广东中金岭南有色股份有限公司凡口铅锌矿

2.广东大宝山矿业有限公司大宝山多金属矿

3.广东韶关瑶岭矿业有限公司瑶岭钨矿

4. 广东广业云硫矿业有限公司云浮硫铁矿

广西：

1.广西东怀矿业有限公司东怀煤矿一号井

2.广西高峰矿业有限责任公司锡矿

3.广西桂华成有限责任公司珊瑚钨矿

4.广西华锡集团股份有限公司铜坑矿

5.广西德保铜矿

6.广西佛子矿业有限公司佛子冲铅锌矿

7.广西贵港市金地矿业有限责任公司龙头山金矿

山西：

1. 山西潞安集团余吾煤业公司（屯留煤矿）

2. 山西晋城无烟煤矿业集团有限公司寺河煤矿

3. 大同煤矿集团大同地煤青磁窑煤矿

4. 山西汾西紫金煤业公司（紫金煤矿）

5. 大同煤矿集团公司晋华宫矿

6. 山西华晋焦煤公司沙曲煤矿

7. 山西霍州煤电集团有限责任公司团柏煤矿

8. 大同煤矿集团朔州朔煤王坪煤电有限责任公司（王坪煤矿）

9. 大同煤矿集团轩岗煤电有限责任公司刘家梁煤矿

10. 山西长平煤业有限责任公司（长平煤矿）

11. 山西新景矿煤业有限责任公司（新景煤矿）

陕西：

1.陕西鄂尔多斯盆地安塞油田

2.陕西洛南县九龙矿业有限公司王河沟钼矿

3.陕西太白黄金矿业有限责任公司新星金矿

4.西北有色地质勘查局二里河铅锌矿

安徽：

1.安徽五沟煤矿有限责任公司五沟煤矿

2.安徽铜陵有色冬瓜山铜矿

3.安徽滁州市铜鑫矿业有限责任公司琅琊山铜矿

4.安徽省濉溪县刘楼铜铁（金）矿

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5.安徽大昌矿业集团有限公司吴集铁矿

6.安徽铜陵海螺水泥有限公司石灰石矿

7.安徽省庐江县何家大岭铁矿

8.安徽铜陵化工集团新桥矿业有限公司(新桥硫铁矿)

9.淮北矿业股份有限公司桃园煤矿

云南：

1.云南省东源煤电股份有限公司后所煤矿

2.云南迪庆矿业开发有限责任公司羊拉铜矿

3.云南驰宏锌锗股份有限公司会泽分公司（会泽铅锌矿）

4.云南玉溪矿业有限公司大红山铜矿

5.云南磷化集团公司晋宁磷矿

6.云南磷化集团公司尖山磷矿

7.云南文山斗南锰业股份有限公司斗南锰矿

辽宁：

1.辽宁抚顺矿业集团有限责任公司东露天矿

2.辽宁抚顺罕王傲牛矿业股份有限公司（傲牛铁矿）

3.辽宁本溪钢铁（集团）矿业有限责任公司歪头山铁矿

4.辽宁省排山楼黄金矿业有限责任公司（排山楼金矿）

5.中国有色集团抚顺红透山矿业有限公司（红透山铜矿）

黑龙江：

1.黑龙江龙煤矿业集团股份有限公司鹤岗分公司新岭煤矿

2.黑龙江龙煤矿业集团股份有限公司七台河分公司龙湖煤矿

3.黑龙江龙煤矿业集团股份有限公司鹤岗分公司峻德煤矿

4.黑龙江龙煤矿业集团股份有限公司双鸭山分公司新安煤矿

5.黑龙江大兴安岭古莲河露天煤矿

6.黑龙江龙煤矿业集团股份有限公司双鸭山分公司东荣二矿

7.黑龙江哈尔滨松江钼业有限公司五道岭钼矿

8. 沈阳煤业（集团）鸡西盛隆矿业有限责任公司新城煤矿

吉林：

1.吉林长春羊草煤业股份有限公司羊草沟煤矿一矿

2.吉林长春羊草煤业股份有限公司羊草沟煤矿二矿

3.吉林通化矿业集团公司道清煤矿

4.吉林八宝煤业有限责任公司（松树镇煤矿八宝采区）

5.吉林通钢集团板石矿业有限责任公司上青矿

6.吉林通钢集团板石矿业有限责任公司井下矿

内蒙古：

1.内蒙古伊泰京粤酸刺沟矿业有限责任公司酸刺沟煤矿

2.内蒙华能伊敏煤电有限责任公司露天矿

3.内蒙古伊泰集团有限公司大地精煤矿

4.内蒙神东天龙集团武家塔露天煤矿

5.内蒙古银都矿业有限公司拜仁达坝银多金属矿

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6.内蒙赤峰山金红岭有色矿业有限责任公司红岭铅锌矿

7.内蒙古黄岗矿业有限责任公司黄岗铁矿

8.内蒙古大中矿业股份有限公司书记沟铁矿

9.内蒙阿拉善左旗和彤池盐业有限责任公司和彤池盐湖矿

10.中国黄金集团内蒙古矿业有限公司新巴尔虎右旗乌努格吐山铜钼矿

福建：

1.福建马坑矿业股份有限公司马坑铁矿

2.福建金东矿业股份有限公司丁家山铅锌矿

四川：

1.四川南江煤电有限责任公司南江煤矿

2.四川嘉阳集团公司（嘉阳煤矿）

3.四川凉山矿业股份有限公司四川省拉拉铜矿

4.四川里伍铜业股份有限公司里伍铜矿

5.四川安宁铁钛股份有限公司潘家田铁矿

6.四川峨胜水泥集团股份有限责任公司峨胜采矿场

7.攀钢集团矿业有限公司兰尖-朱家包包铁矿

重庆：

1.重庆中梁山煤电气有限公司矿业分公司南井煤矿

2.重庆南桐矿业有限责任公司南桐煤矿

3.重庆永荣矿业有限公司韦家沟煤矿

4.重庆松藻煤电气有限责任公司打通一煤矿

5.重庆钢铁集团矿业有限公司景星白云石矿

宁夏：

1.神华宁夏煤业集团有限责任公司枣泉煤矿

2.神华宁夏煤业集团有限责任公司汝箕沟煤矿

3.神华宁夏煤业集团有限责任公司任家庄煤矿

4.宁夏王洼煤业有限公司王洼煤矿

甘肃：

1.甘肃窑街煤电集团天祝煤矿有限责任公司（天祝煤矿）

2.甘肃窑街煤电集团有限公司三矿

3.甘肃省西和县三联矿业有限公司(三和县三联铅锌矿)

4.甘肃肃北县金鹰黄金有限责任公司鹰咀山金矿

5.甘肃岷县天昊黄金有限责任公司鹿峰金矿

6.甘肃玛曲格萨尔黄金实业股份有限公司大水金矿

7.甘肃徽县宏远矿业有限责任公司天坪金矿

8.甘肃省合作早子沟金矿有限责任公司（早子沟金矿）

湖南：

1.湖南天泰煤业有限公司（腊树垭煤矿）

2.湖南衡阳远景钨业有限责任公司大皂工区（杨林坳矿区）

3.湖南有色新田岭钨业有限公司（新田岭钨矿）

4.湖南宝山铅锌银矿

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5.湖南省新邵县龙山金锑矿

6.湖南沅陵沃溪金锑钨矿

7.湖南有色金属股份有限公司黄沙坪矿业分公司（黄沙坪铅锌矿）

8.湖南省湘衡盐化有限责任公司（湘衡盐矿）

9.湖南省七宝山硫铁矿

10.湖南黄金洞矿业有限责任公司（黄金洞金矿）

湖北：

1.湖北宝源广得资源有限公司马河煤矿

2.湖北大冶有色金属股份有限公司铜绿山铜铁矿

3.武汉钢铁集团矿业有限责任公司大冶铁矿

4.湖北宜昌华西矿业有限责任公司华兴磷矿

5.湖北柳树沟矿业股份有限公司丁西磷矿

6.湖北双环化工集团有限公司盐厂水采矿区

7.湖北兴山县兴盛矿产有限公司兴隆磷矿

8.湖北尧治河化工股份有限公司尧治河磷矿

9.湖北杉树垭矿业有限公司杉树垭磷矿区东部矿段

10.湖北省黄麦岭磷化工有限责任公司黄麦岭磷矿

江西：

1.江西煤业集团有限责任公司安源煤矿

2.江西耀升工贸发展有限公司茅坪钨钼矿

3.江西方圆（德安）矿业投资有限公司（尖峰坡锡矿）

4.江西省营前矿业有限公司蕉里铅锌矿

5.江西新余良山矿业有限责任公司（良山铁矿）

贵州：

1.贵州盘江精煤股份有限公司土城煤矿

2.贵州金兴黄金矿业有限责任公司紫木凼金矿

3.贵州紫金矿业股份有限公司水银洞金矿

4.贵州瓮福（集团）有限责任公司瓮福磷矿

青海：

1.义煤集团青海义海能源有限责任公司大煤沟煤矿

2.青海西部矿业股份有限公司锡铁山铅锌矿

3.青海盐湖工业股份有限公司察尔汗盐湖钾镁盐矿

江苏：

1.江苏苏州市小茅山铜铅锌矿

2.南京银茂铅锌矿业有限公司栖霞山铅锌矿

3.江苏句容台泥水泥有限公司矽锅顶水泥灰岩矿

4.江苏徐州铁矿集团有限公司（利国铁矿）

5.南京钢铁集团冶山矿业有限公司冶山铁矿

6.南京梅山冶山发展有限公司梅山铁矿

7.江苏镇江韦岗铁矿有限公司韦岗铁矿

8.中国高岭土公司（苏州高岭土矿）

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浙江：

1.浙江省杭州建铜集团有限公司建德铜矿

2.浙江省遂昌金矿有限公司（遂昌金矿）

3.浙江龙泉市砩矿有限责任公司（八都萤石矿）

4.浙江省东阳市忠信堂萤石矿

5.浙江富阳山亚南方水泥有限公司大同石灰岩矿

6.浙江湖州南方矿业有限公司大煤山石灰石矿

7.浙江湖州市菱湖东林镇平山矿区

8.浙江漓铁集团有限公司（漓渚铁矿）

海南：

1.海南矿业月份有限公司昌江县石碌铁矿

西藏：

1.西藏华泰龙矿业开发有限公司甲玛铜多金属矿