[Xia Jun, Deputy Director of the General Office of the Ministry of Natural Resources] Dear journalists and colleagues, good afternoon! Welcome to the 2017 National Mineral Resource Reserves Press Conference. Since the 18th National Congress of the Communist Party of China, China’s management of mineral resource reserves has, in line with the overall requirements of supply-side structural reform, further strengthened our resource base and continuously improved the quality and level of mineral resource reserves, thereby providing a solid resource guarantee for the development of the national economy. This afternoon’s press conference is primarily aimed at sharing with you the latest data on national mineral resource reserves for 2017.

Attending today’s press conference are Comrade Ju Jianhua, convener of the Supervision and Inspection Team for Mineral Resource Protection under the Ministry of Natural Resources, and Comrade Cao Xinyuan, Deputy Director of the Ministry’s Information Center. First, let’s welcome Comrade Ju Jianhua to introduce the latest data on national mineral resource reserves for 2017. (2018-07-10 14:59)

[Ju Jianhua, Convenor of the Supervision and Inspection Task Force for Mineral Resource Protection under the Ministry of Natural Resources] Mineral resources are an essential foundation for the sustainable development of the national economy, and their supply-and-demand situation directly affects national economic security. To further strengthen and improve the statistical management of mineral resource reserves and enhance awareness across all sectors of society regarding China’s mineral resource situation, we hereby release the following information on nationwide mineral resource reserves for 2017:

I. Overall Changes in Identified Resource Reserves in 2017

With the approval of the State Council, natural gas hydrates were designated as a new mineral species in 2017, bringing the total number of mineral species discovered in China to 173 by the end of 2017. By major mineral category, there are currently 13 energy minerals, 59 metallic minerals, 95 non-metallic minerals, and 6 hydrocarbon-gas minerals.

A total of 162 mineral species and 230 sub-mineral species have been identified nationwide, with proven reserves already ascertained. Compared to the previous year, among the 215 sub-mineral species summarized and reported this time, 118 saw an increase in proven reserves, 40 experienced a decrease, and 57 remained unchanged.

(1) Reserves of most energy minerals have increased, with shale gas showing the largest growth. Oil and natural gas reserves have grown slowly, while coalbed methane reserves have declined.

In 2017, China's proven coal reserves increased by 4.3%. The remaining technically recoverable reserves of oil, natural gas, and shale gas rose by 1.2%, 1.6%, and 62.0%, respectively, while coalbed methane reserves declined by 9.5%.

Over the past five years, China has made significant progress in shale gas exploration. As of the end of 2017, the cumulative proven geological reserves totaled 916.8 billion cubic meters, and by April of this year, they had exceeded one trillion cubic meters. In 2017, two shale gas fields—namely the Fuling Shale Gas Field and the Weiyuan Shale Gas Field in the Sichuan Basin—each added more than 100 billion cubic meters of proven geological reserves through exploration.

Newly discovered geological reserves from oil, natural gas, and coalbed methane exploration have shown a downward trend. In 2017, newly discovered geological reserves from oil exploration fell from 1.522 billion tons in 2012 to 877 million tons; for natural gas, they declined from 961 billion cubic meters to 555.4 billion cubic meters; and for coalbed methane, they dropped from 127.4 billion cubic meters to 10.5 billion cubic meters.

Newly identified coal reserves from exploration have shown a rebound. In 2017, newly identified coal reserves from exploration totaled 81.5 billion tons, significantly higher than the 60.7 billion tons in 2016 and the 39 billion tons in 2015. In 2017, there were three coal mining areas nationwide where newly identified coal reserves exceeded 5 billion tons, all located in Xinjiang.

(2) Proven reserves of metallic mineral resources have generally increased. The growth rates vary among ferrous metal minerals, while non-ferrous metal minerals show a modest increase, and precious metal minerals have experienced a relatively substantial increase.

Among black metal minerals, in 2017, the identified reserves of manganese ore increased by 19.1%, with an average annual growth rate exceeding 10.0% over the past five years. In 2017, newly identified manganese ore reserves from exploration totaled 280 million tons, and the cumulative newly identified reserves over the past five years reached 880 million tons. In 2017, the identified reserves of iron ore increased by 1.0%, while those of chromite ore declined by 1.1%.

Among non-ferrous mineral resources, the identified reserves of nickel and mercury mines remained essentially unchanged in 2017, while all other minerals showed growth. Specifically, copper, lead, zinc, bauxite, magnesium, molybdenum, antimony, and bismuth mines saw increases ranging from 4.0% to 7.0%, whereas cobalt, tungsten, and tin mines increased by 2.3%, 1.4%, and 1.1%, respectively.

Among precious metal minerals, in 2017, the identified resource reserves of gold mines increased by 8.5%, while those of silver mines rose by 14.8%. Over the past five years, cumulative newly identified resource reserves from gold exploration totaled 5,242 tons, and for silver mines, they amounted to 107,000 tons. In 2017 alone, newly identified resource reserves from gold exploration reached 1,104 tons. Among the gold mining areas with newly identified reserves exceeding 100 tons were the Xiling Gold Mine in the Sanshandao Mining Area of Laizhou City, Shandong Province (377 tons), and the Beiyaya Gold Mine in Heqing County, Yunnan Province (114 tons).

In 2017, the identified resource reserves of “three rare” metals—rare, rare-earth, and dispersed metals—mostly increased. Among these, the identified resource reserves of scandium and rhenium showed particularly significant growth. However, the growth of lithium and zirconium resources was relatively slow, at only 0.6% and 0.2%, respectively.

(3) Among non-metallic minerals, fluorite and graphite have seen significant increases in identified resource reserves, while potash continues to decline.

Among major non-metallic minerals, both pyrite and phosphate rock reserves identified in 2017 showed growth. Phosphate rock reserves have maintained growth for several consecutive years, with newly identified reserves added through exploration totaling 5.54 billion tons over the past five years.

The proven reserves of common fluorite and crystalline graphite have shown significant growth. Over the past five years, cumulative exploration has added 35.86 million tons of proven reserves for common fluorite; for crystalline graphite, cumulative exploration has added a total of 170 million tons, including 57.31 million tons newly discovered in three mining areas—such as the 260 High Ground in Luobei County, Heilongjiang Province.

Potash reserves have been declining for three consecutive years, and the remaining technically recoverable reserves of carbon dioxide gas in hydrocarbon and gas resources have also decreased. (2018-07-10 15:04)

[Ju Jianhua, Convenor of the Supervision and Inspection Task Force for Mineral Resource Protection under the Ministry of Natural Resources] II. Changes in Reserves of 24 Strategic Mineral Resources

Over the past five years, China’s reserves of strategic mineral resources required for new energy and emerging industries have grown rapidly. Shale gas reserves have expanded from zero to a point where cumulative proven geological reserves now exceed one trillion cubic meters. Compared with the end of 2012, by the end of 2017, reserves of China’s major strategic mineral resources had all increased—except for a few specific minerals. In particular, reserves of crystalline graphite (up 93.7%), gold (up 61.0%), tungsten (up 47.9%), molybdenum (up 41.0%), antimony (up 34.2%), and bauxite (up 33.2%) saw increases of over 30%. Notably, natural gas (up 26.1%), phosphate rock (up 26.0%), nickel ore (up 22.2%), copper ore (up 17.4%), coal (up 17.3%), and fluorite (up 15.2%) also experienced significant growth.

From 2013 to 2016, the growth rate of proven reserves of major strategic minerals showed a year-on-year downward trend. For example, the increase in remaining technically recoverable oil reserves dropped from 6.3% in 2013, to 2.0% in 2014, to 1.8% in 2015, and finally to just 0.1% in 2016. The growth rate of natural gas reserves declined from 22.8% in 2013 to 4.7% in 2016. Proven coal reserves fell from 10.7% in 2013 to 2% in 2016; iron ore reserves decreased from 9.8% to -1.2%; copper reserves dropped from 13.3% to 2%; and gold reserves fell from 9.5% to 5.2%. In 2017, the downward trend in the growth rate of proven reserves of key strategic minerals began to ease somewhat. The growth rates of proven reserves for coal (4.3%), oil (1.2%), iron ore (1.0%), copper (4.9%), and gold (8.5%) all rebounded. (2018-07-10 15:08)

[Xia Jun, Deputy Director of the General Office of the Ministry of Natural Resources] Thank you, Comrade Ju Jianhua. Next, we’ll open the floor for questions from the reporters. (2018-07-10 15:11)

[Reporter] Could you please give us an overview of China’s mineral resource situation? (2018-07-10 15:15)

[Ju Jianhua, Convenor of the Supervision and Inspection Task Force for Mineral Resource Protection under the Ministry of Natural Resources] Mineral resources are an essential material foundation for economic and social development. Over the long term, China’s exploration and development of mineral resources have played a crucial supporting role and made significant contributions to the country’s economic and social progress. At present, as our economy shifts from a phase of high-speed growth to one of high-quality development, new and higher demands are placed on the safe and efficient supply of mineral resources, while also presenting new challenges. Overall, China’s national conditions regarding mineral resources remain unchanged; the important status of mineral resources has not changed; and resource and environmental constraints continue to tighten. As a result, the situation concerning the supply of mineral resources is extremely severe, and the tasks ahead are exceedingly arduous. This is mainly reflected in the following aspects:

First, in recent years, the proven reserves of most minerals have continued to grow, yet the growth rate has significantly slowed down, and the driving forces behind this growth have become insufficient. Over the past five years, the nation’s cumulative investment in geological exploration has exceeded 480 billion yuan, and the Strategic Action for Breakthroughs in Mineral Exploration has achieved important results: 218 large-scale mineral deposits and 261 medium-sized ones have been newly discovered, along with eight new oil fields each containing over 100 million tons and 14 gas fields each containing over 100 billion cubic meters. However, affected by the profound global adjustment in the mining industry, China’s investment in mineral exploration and development has declined for five consecutive years, with a cumulative drop of 40%. For most mineral types, the growth rate of proven reserves has noticeably slowed down—for instance, in 2017, newly discovered geological reserves of petroleum fell below 1 billion tons for the second consecutive year; newly discovered geological reserves of natural gas decreased by 20% year-on-year; and the growth rates of iron ore and copper ore have also slowed considerably.

Second, while the development of mineral resources has supported economic and social development, China’s dependence on foreign sources for many bulk minerals has been steadily increasing, driving up import costs. In recent years, the output of China’s major mineral products has either declined or slowed down in growth, and the development of certain strategic emerging minerals has lagged behind. Currently, China’s reliance on foreign sources for critical minerals such as chromium, cobalt, gold, lithium, copper, nickel, iron ore, and petroleum continues to rise. China has now surpassed the United States to become the world’s largest importer of crude oil, and its dependence on foreign sources—and the concentration of imports—of strategic emerging minerals like cobalt, nickel, and lithium are particularly high. As international mineral prices rebound, China’s import costs for minerals have risen sharply. Therefore, it is essential to continuously promote international cooperation in the mining sector and achieve complementary advantages in resource endowments.

Third, although prices of mineral products have bottomed out and begun to rebound, social investment enthusiasm for exploration and development remains low. Fixed-asset investment in the mining sector has declined for four consecutive years, and the vitality of the mining market has yet to see a fundamental improvement. Since 2016, prices of major mineral products have shown a trend of bottoming out and rebounding; however, due to various factors, the mineral product market has still not truly recovered, lacking sufficient market dynamism and failing to spark strong social investment interest. In 2017, geological exploration expenditures totaled 77.568 billion yuan, roughly unchanged from the previous year. Of this amount, investment in oil and gas exploration reached 57.790 billion yuan, up 9.6% year-on-year; while investment in non-oil-and-gas mineral exploration came to 19.778 billion yuan, down 20.2% year-on-year. In 2017, China’s fixed-asset investment in the mining sector totaled 920.9 billion yuan, a decrease of 10.8% compared to 2016. The mining industry’s profit margin (8.6%) was slightly higher than the average for the industrial sector (6.3%).

Fourth, the level of mineral resource exploration and utilization has improved to some extent, yet development remains uneven and insufficient, with significant disparities in the construction standards of mining enterprises. Over the years, China has optimized the structure of its mining industry, increasing the proportion of large- and medium-sized mines to over 13%. Resource utilization efficiency has also improved. A number of major enterprises—such as PetroChina, Sinopec, CNOOC, Aluminum Corporation of China, and China Minmetals—have now joined the ranks of the world’s largest resource-based mining companies. The comprehensive utilization levels of mines like the Baiyun Obo iron-rare earth mine, the Panzhihua vanadium-titanium magnetite mine, and the Wengfu phosphate mine in Guizhou have reached world-leading standards. However, some older mines and small- and medium-sized mines still suffer from weak capabilities in scientific and technological innovation, fail to fully harness the resource benefits of their advantageous minerals, and continue to engage in extensive and inefficient use of mineral resources. Environmental issues associated with mining remain prominent. China ranks first in the world both in terms of mineral consumption and production, making it a major mining country—but not yet a mining powerhouse. (2018-07-10 15:16)

[Reporter] Could you please explain how we ensure the reliability and accuracy of China’s statistical data on mineral resource reserves? (2018-07-10 15:27)

[Cao Xinyuan, Deputy Director of the Department Information Center] It should be said that reliability and accuracy are the lifeline of mineral resource reserve statistics. The competent authorities for natural resources primarily ensure the reliability and accuracy of mineral resource reserve statistical data from the following five aspects.

First, at the level of laws, regulations, and departmental rules, the Mineral Resources Law of the People’s Republic of China sets forth general requirements for the statistical data on mineral resource reserves. Moreover, Order No. 23 of the former Ministry of Natural Resources—the “Administrative Measures for the Registration and Statistics of Mineral Resources”—provides specific stipulations regarding statistical data, requiring that such data be “truthful, accurate, comprehensive, and timely,” and clearly defines the corresponding legal responsibilities.

Second, at the institutional level, separate statistical systems for mineral resource reserves have been established for two distinct categories of minerals—oil and gas minerals as well as non-oil and gas minerals—and different statistical channels are used to carry out the statistical work, thereby ensuring the reliability and accuracy of resource reserve data.

Data on oil and gas reserves are directly submitted to the Ministry of Natural Resources each year by PetroChina, Sinopec, CNOOC, and local petroleum companies, reflecting annual changes in oil and gas reserve levels.

Data on reserves of non-oil and gas mineral resources, after being reviewed by the departments of natural resources of each province, autonomous region, and municipality directly under the central government, shall be submitted to the Ministry of Natural Resources.

Third, in terms of statistical data review, the Ministry adopts a rigorous annual joint review procedure. Each year, the Ministry convenes a meeting to review and verify reported data on oil, gas, and mineral reserves, inviting experts from major oil and gas companies and relevant institutions to examine changes in oil, gas, and mineral reserve levels across provinces and maritime areas. At the annual national meeting for reviewing and verifying data on non-oil and gas mineral resources, experts from each province (autonomous region, municipality) and relevant units within the Ministry conduct logical checks on the database and assess the reasonableness of annual changes in all non-oil and gas mineral resource reserves.

Fourth, with regard to newly discovered resource reserves, whether for oil and gas minerals or non-oil and gas minerals, there is a stringent system for reserve evaluation and certification. All newly discovered reserves or significant changes in existing reserves undergo rigorous evaluation and certification, thereby ensuring the authenticity, reliability, and accuracy of mineral resource reserve data.

Fifth, standardize the release of statistical data on mineral resource reserves. Based on the nationally compiled and aggregated statistics on mineral resource reserves, the Ministry prepares the “National Oil and Gas Resource Reserve Bulletin” and the “National Mineral Resource Reserve Bulletin,” and adopts a standardized and rigorous procedure to finalize and release these reports.

In short, China’s statistical work on mineral resource reserves is underpinned by stringent legal regulations, a rigorous statistical system, strict review procedures, a stringent appraisal system, and a meticulous publication process—all of which ensure the reliability and accuracy of statistical data. (2018-07-10 15:28)

[Reporter] Shale gas proven geological reserves have exceeded one trillion cubic meters. Could you please explain the background and significance of the rapid development of shale gas in China? (2018-07-10 15:29)

[Ju Jianhua, Convenor of the Supervision and Inspection Task Force for Mineral Resource Protection under the Ministry of Natural Resources] Shale gas, as a high-quality, efficient, clean, and low-carbon energy source, is playing an increasingly important role in primary energy consumption. China boasts abundant shale gas resources, yet its exploration and development rate remains low, leaving enormous untapped potential. Accelerating the development of the shale gas industry is of great strategic significance for enhancing China’s energy resource security, optimizing the energy structure, improving the ecological environment, and building a clean, low-carbon, safe, and efficient energy system.

Since the start of shale gas exploration and development in China in 2005, the industry has gone through several key stages: resource potential evaluation, fundamental theoretical research, identification of favorable exploration zones, breakthroughs in exploration, pilot-scale development trials, and capacity-building. In recent years, the sector has achieved significant breakthroughs and rapid development. First, from September 2014 to April 2018—less than four years—the Fuling, Weiyuan, Changning, and Weirong shale gas fields were discovered in the Sichuan Basin, bringing the cumulative newly proven geological reserves of shale gas beyond one trillion cubic meters. The total production capacity reached 13.5 billion cubic meters, with a cumulative gas output of 22.58 billion cubic meters. As a result, China has become the second country after North America to achieve large-scale commercial development of shale gas fields. Second, in line with the concept of green development, China has innovatively developed a series of practical clean-production technologies tailored to the characteristics of shale gas development, enabling clean production throughout the entire exploration and development process of shale gas fields. Third, China has established a shale gas accumulation theory, core exploration and development technologies, equipment, and standards that are uniquely suited to its national conditions, laying an important foundation for the rapid development of China’s shale gas industry. Fourth, based on resource assessment results, the technically recoverable shale gas resources in favorable areas nationwide amount to 21.8 trillion cubic meters; currently, the proven recovery rate stands at only 4.79%, indicating enormous resource potential. (2018-07-10 15:30)

[Reporter] Currently, various pieces of information about resource reserves frequently appear on the internet and in the media. Which of these pieces of information are authentic and authoritative? (2018-07-10 15:32)

[Ju Jianhua, Convenor of the Supervision and Inspection Task Force for Mineral Resource Protection under the Ministry of Natural Resources] Information on mineral resource reserves is among the most critical foundational data in the fields of mineral exploration and mining. It touches upon various aspects—including national resource security, major decision-making, policy formulation, social investment and financing, the mining market environment, and the integrity system—and thus draws widespread attention from all sectors of society. We have also noted that certain organizations, enterprises, and individuals have been arbitrarily releasing information on mineral resource reserves without undergoing the legally required review and filing procedures—particularly a small number of cases involving exaggerated or even false information, which have already caused considerable negative impacts on society. In fact, back in 1999, our ministry and the Publicity Department of the CPC Central Committee jointly issued the “Notice of the Publicity Department of the CPC Central Committee and the Ministry of Natural Resources on Strengthening the Management of Mineral Resource Information” (Guotu Zi Fa [1999] No. 419), calling for enhanced management to prevent inaccurate reporting. According to this notice, major information on mineral resource reserves must be reviewed by the natural resources authorities before being publicly released. In 2012, we issued the “Notice of the Ministry of Natural Resources on Standardizing the Release of Information on Mineral Exploration and Resource Reserve Results” (Guotu Zi Fa [2012] No. 34), further clarifying relevant matters concerning the release of such information. Specifically, the notice clearly defines the division of responsibilities for information release, the procedures for temporarily suspending publication, and the media authorized to disseminate such information. The reserve results information released by the competent natural resources authorities is conducted in strict accordance with the law, following rigorous review and filing procedures. Natural resources management departments and review institutions at all levels meticulously scrutinize the information, and a layered system of accountability and enforcement mechanisms ensures compliance. For example, we require that mining right holders assume responsibility for the authenticity of the mineral exploration and resource reserve data they submit; review experts must provide signed review opinions; and review institutions must issue review opinion reports and take full responsibility for the conclusions reached in their reviews. (2018-07-10 15:33)

[Host, Guests, Netizens] That’s all for today’s press conference. Thank you everyone! (2018-07-10 15:34)