The mixed situation—both joys and worries—of state-owned geological exploration units, along with their projected future outlook, prompted numerous reflections and valuable insights among the participants from national non-ferrous metal geological exploration bureaus, research institutes, and other state-owned geological exploration organizations.

　　2015 was a special year for the state-owned geological exploration industry, facing a “major test” under the dual pressures of a prolonged downturn in the global mining economy and the accelerated pace of institutional reform. How to “prepare for the exam”? This has become the primary focus of attention within the industry.

　　August 13–14 On [date], the 12th National High-Level Forum on the Development and Reform of the Nonferrous Metals Geological Exploration Industry was held in Urumqi. The mixed situation—characterized by both challenges and opportunities—along with the outlook for state-owned geological exploration units, prompted extensive reflection and yielded valuable insights among participants from national nonferrous metals geological survey bureaus, research institutes, and other state-owned geological exploration organizations.

　　Joy: New changes have emerged both internally and externally.

　　With increasing downward economic pressure and a sharp contraction in mining investment, state-owned geological exploration units are facing tremendous pressure in their development.

　　Since 2014, China’s nonferrous metal geological exploration units have been operating in this broad economic environment. Rather than waiting for others or relying on external support, these units have proactively embarked on active explorations to adapt to the new normal, and through their own efforts have brought about new and encouraging changes.

　　One of the changes is the proactive advancement of classification reform. Guided by the principle of “optimizing public services and strengthening enterprise capabilities,” the Nonferrous Metals Mineral Geology Survey Center, with the support of the State-owned Assets Supervision and Administration Commission and the China Nonferrous Metals Industry Association, carried out an internal separation of public-service and enterprise functions in January of this year. As a result, the center—previously operating under a “mixed dual-operation” model—has been split into two entities: the Nonferrous Metals Mineral Geology Survey Center, which primarily undertakes public-service functions, and the Beijing Institute of Mineral Geology, whose main task is enterprise management.

　　After the separation was completed, the Beijing Institute of Mineral Geology, leveraging its subsidiary, China Color Geological Corporation, achieved a strong start in reversing the downward trend in corporate profits despite the ongoing global downturn in the mining industry. First, the company reduced costs and improved efficiency in mine development. Even as prices for mineral products such as copper continued to fall, it offset the impact of these price declines by strengthening technological upgrades and adopting more refined management practices, resulting in revenues of 253 million yuan and profits of 42 million yuan. First, we carried out restructuring and optimization of our asset structure, transferring equity stakes in several mining enterprises that we held but which were suffering severe losses. Second, in line with the overall requirements of “scaling up and branding” for geological services, we implemented a “large projects, major clients” strategy, achieving settlement revenues of 338 million yuan and net profits of 64.9 million yuan. Third, our geological exploration business actively undertook large-scale general contracting projects as well as overseas drilling projects, generating operating revenues of 219 million yuan and net profits of 52.6 million yuan. Fourth, our surveying and geospatial information business has set its sights on areas such as digital national land, digital cities, and smart cities, demonstrating strong growth momentum. Fifth, our geological hazard and environmental services have established a market focus primarily around Beijing’s surrounding areas, as well as the southwest and northwest regions, securing new contracts worth 130 million yuan—a 157% increase over last year. Sixth, financial restructuring has supported overseas exploration efforts; our overseas-listed subsidiary successfully completed market financing totaling 2.38 million U.S. dollars, not only securing funding for high-quality overseas projects but also facilitating the restructuring of multiple projects.

　　The second change involves adjusting the primary business direction to adapt to the evolving situation. As investments in resource-oriented exploration, such as mineral exploration, have sharply declined, various non-ferrous geological survey units have shifted their primary focus to geology-related work that directly impacts people’s livelihoods—such as environmental geology and disaster geology. This not only meets the new market demands arising from the national shift in emphasis toward geological work but also opens up new avenues for growth. Taking advantage of Hunan Province being designated as one of the nation’s three pilot provinces for geological disaster prevention and control—and benefiting from substantial national funding allocations for this effort—the Hunan Non-Ferrous Metals Bureau proactively entered into land remediation projects while concentrating on geological disaster prevention and control, thereby achieving a balanced shift in its sources of economic revenue. By the end of June this year, the bureau had completed a total output value of 8.8. The company’s revenue reached 100 million yuan, and its profit amounted to 35 million yuan—increases of 50% and 45%, respectively, compared to the previous year. Adapting to the new normal, the Guizhou Nonferrous Metals Bureau has avoided being constrained by its traditional “nonferrous metals” focus. Instead, it has launched specialized projects in uranium exploration, engineering surveys, geological hazard prevention, development of hot springs and shallow geothermal energy, land development and remediation, and soil pollution control, thereby ushering in a new phase of diversified economic growth. In the first half of this year, the bureau’s total contract value increased by 13.6% year-on-year, and its output value rose by 39% year-on-year.

　　Third, from the perspective of the external development environment, how geological exploration units should proceed has drawn attention from some provincial business authorities. Recently, the Gansu Provincial Department of Natural Resources and Environment stated that if geological exploration units are struggling financially, it would indicate that the department itself has not been performing its duties effectively. Meanwhile, in response to new challenges that may arise following the accelerated implementation of institutional classification reform and the integration of pension insurance systems for public institutions, the Qinghai Provincial Department of Natural Resources and Environment has, based on thorough research, preliminarily formulated a strategy to further support the development of geological exploration units—building upon existing policies supporting their growth—and is preparing to introduce additional preferential policies for these units after coordinating with relevant provincial departments.

　　Worry: The fundamental issues remain unresolved.

　　At the turn of the century, the state implemented a reform of the management system, shifting geological exploration units under local jurisdiction. Yet to this day, the fundamental issues that continue to constrain the development of these units remain unresolved. During the forum, participants did not shy away from discussing some long-standing problems.

　　State-owned geological exploration units can no longer be viewed merely as “mineral exploration workshops.” So, where exactly lies the way forward for the reform of these state-owned geological exploration units?

　　During the symposium, participants generally reported that geological exploration units lack unified guidance and policy support for their reform and development. In recent years, the state has been increasingly meticulous and standardized in its management of public institutions—a move that is indeed necessary for deepening the separation of government and enterprises as well as the separation of public services from business operations. However, based on issues raised during exchanges among geological exploration units across various regions, there is a noticeable absence of nationwide guiding principles and corresponding policy support tailored specifically to geological exploration units in the context of institutional classification reform. Take, for example, the nature of state-owned geological exploration units: in the classification reform, the vast majority of bureau-level agencies opted for Category I public institutions, while team-level units mostly chose Category II institutions. Under the previous Ministry of Natural Resources’ policy—“wearing the hat of a public institution yet following the path of an enterprise”—many geological exploration bureaus adapted to the demands of corporate competition by adopting enterprise-oriented management strategies centered around their bureaus themselves, aiming to expand and strengthen their core business entities. Yet in this round of classification reform, constrained by the policy prohibiting public institutions from engaging in commercial activities, these bureaus have been forced once again to revert to enterprise-style management organized around teams. As a result, the competitive landscape has shifted from large-scale market players to smaller ones, and homogeneous competition within individual bureaus has intensified.

　　During the symposium, another prominent issue raised by participants was the urgent need to further improve the working environment for geological exploration. Participants generally agreed that today’s geological exploration faces more and more complex environmental challenges compared to the past, primarily manifested in three key areas: First, environmental protection pressures have intensified. Although various exploration units have been diligently implementing the concept of “green exploration” in their work, public and governmental understanding of and support for exploration activities continue to decline year after year. Moreover, there have been frequent instances of significantly raising compensation standards under the guise of environmental protection. Second, since the introduction of the performance-based salary system in public institutions, linking income to mineral exploration results has largely become a mere formality—effectively an empty promise. At the same time, following this round of salary increases, the proportion of performance-based pay in total income has declined. These new factors will severely hinder the mobilization of staff enthusiasm. Third, the difficulty in obtaining mining rights remains a widespread problem nationwide, and the phenomenon of geological exploration units essentially acting as hired laborers deserves close attention.

　　Exam: Requires joint efforts from both upper and lower levels.

　　Faced with these challenges, achieving sustainable development for state-owned geological exploration units requires joint efforts from both the government and the geological exploration units themselves. During the discussion, everyone reached a consensus: there’s no turning back on reform.

　　From the perspective of geological exploration units themselves, while shifting their mindset, they must also make a strategic shift in institutional choices—from previously lingering between mixed public-sector and enterprise models to focusing on optimizing the public sector and strengthening the enterprise. In terms of industrial development, they should move from a focus primarily on resource geology to a balanced approach that integrates both resource geology and geology serving people’s livelihoods. Regarding service capabilities, they need to transition from homogeneous competition to differentiated and specialized competition. And in terms of management models, they must shift from extensive management to standardized and refined management.

　　From the government’s perspective, the first priority is to clarify the fundamental questions regarding the positioning of geological exploration units: Should this team even exist? What should be the optimal size for this team? And where should it be appropriately placed? Clear answers must be provided to these basic questions, accompanied by the introduction of targeted policies and measures. Second, in terms of the approach to developing geological exploration units, inter-departmental coordination and collaboration must be implemented. Moreover, regulatory oversight of these units should adopt differentiated policies tailored to their various types of undertakings. Third, concerning the reform of geological exploration units, the state should take into account the associated costs of such reforms. It would be unfair to discuss reform without addressing the costs involved. Fourth, with regard to the preferential policies previously issued by the state to support the development of geological exploration units, we must rigorously enforce them in accordance with General Secretary Xi Jinping’s instruction to “leave footprints on every stone and leave marks on every iron.” We must ensure that these policies do not become mere “moonlight in water or flowers reflected in a mirror”—empty promises with no real impact on the development of geological exploration units.