Chinalco to Invest RMB 5.2 Billion in 3 Major Rare Earth Projects of Guangxi

Chinalco to Invest RMB 5.2 Billion in 3 Major Rare Earth Projects of Guangxi

The process of the head office of Chinalco(hereinafter referred to as Chinalco) shifting to a comprehensive nonferrous metals enterprise is gearing up.After acquiring rare earth resources in Guangxi in 2011,Chinalco plans to make an investment of additional RMB 5.2 billion in exploiting rare earth resources of Hezhou and Chongzuo,Guangxi,consisting of 3 major projects.

In July 2011,Chinalco Guangxi Nonferrous Rare Earth Development Co.,Ltd.was founded by Chinalco,Guangxin Nonferrous Metals Group Co.,Ltd.and Grirem Advanced Materials Co.,Ltd.The new company will concentrate on 4 areas,i.e.,rare earth mineral resources exploration,smelting & separation,scientific research on deep processing & rare earth and trade.

According to the agreement between Chinalco and Guangxi,Chinalco will invest RMB 2 billion in the next 3 years in the cooperation with Guangxi,and forge a complete rare earth industrial chain with core competitiveness in terms of rare earth separation,magnetic materials and rare earth equipment production.A China South Rare Earth Industrial Park will come into being.

According to an official of Chongzuo Development and Reform Committee,Guangxi is rich in ion-type rare earth,which is even on a par with that of Jiangxi rare earth mine in terms of grade.“However,taking the funding factor into account,plus the fact that rare earth resources in Guangxi have not been massively exploited as Jiangxi and Inner Mongolia,etc.,Guangxi is short of experience and technologies.After investigation into many enterprises directly under the central government,Guangxi eventually authorized Chinalco to consolidate and develop its rare earth resources.”

Chinalco Guangxi rare earth project now mainly consists of the following 3 key projects:Hezhou Wanggao Rare Earth Functional Materials Industrial Park will develop rare earth deep processing series products; Hezhou Jinyuan Company will build a 3000-ton rare earth metals & alloy project,and launch a 40-million CMY rare earth energy lamp project;Chongzuo project will set up a 5,500-ton rare earth separation project.The investments for the above 3 projects are RMB 2 billion,RMB 1.6 billion and RMB 1.6 billion respectively.

Jinyuan Company was previously a local enterprise of Hezhou,but was acquired by Chinalco Guangxi Rare Earth Company last year.

In Chongzuo city,Chinalco Guangxi Rare Earth Company has signed a contract with the Management Committee of Chongzuo Urban Industrial Zone.Jiangsu Guosheng Rare Earth Company is reconstructing in Chongzuo Industrial Park by means of relocation.Both parties will form preliminarily Chongzuo South Rare Earth Recycling Economy Industrial Park.

Unexpectedly,although Chinalco Guangxi Rare Earth Company has signed an agreement with Hezhou as early as in August 2011,compared with Chongzuo project,the project in Hezhou made very slow progress.

According to public information,in February 2012,Hezhou and Chinalco Guangxi Rare Earth Company held a talk in which Hezhou required Chinalco to advance the investmentprogress and promised to accelerate to carry forward mineral warrant,mandatory production plan and applications for export quotas.Now,both parties are jointly formulating a control plan of Hezhou rare earth industrial park,so as to start the first infrastructure construction of the industrial park by the end of this September.

It is noteworthy that MLR has ceased issuance of all new mining permits since May 2011 while the 107 rare earth mining permits mostly belong to local enterprises.The situation has become the biggest bottleneck for enterprises directly under the central government to acquire upstream rare earth resources.

Wang Caifeng,head of the Association of China Rare Earth Industry,revealed that the cooperation between Chinalco and Hezhou covers mining rights.

It is reported that the reserves of rare earth resources in Guangxi remain a leading position in China,of which the predicted total amount of ion-absorption rare earth resources ranks the first in China.Currently,the proved reserves of rare earth oxides stand at 1,100,000 tons.However,mining and processing of rare earth mines are strictly controlled due to policies on environmental protection and national strategic resources protection.

Liu Chen,Vice Director of Guangxi Metallurgy Research Institute,told the reporter,in order to break fundamentally the unordered and fragmented situation of rare earth mining in Guangxi,Guangxi is formulating development and utilization plan of rare earth ore and will submit the plan to MLR.

At the end of 2011,“Verification Report on Rare Earth Resources Reserves of Zhoujia and Dengjiaba Section of Huashan Mine Area,Zhongshan–Fuchuan County,Guangxi”passed expert review.It is Guangxi’s first verification report on reserves of mid-sized rare earth mines that has passed ministerial and provincial expert review.The report covers exactly Hezhou,where the Chinalco Guangxi rare earth company is located.

Lu Jingyu,Director of Mineral Resources Administration Division of the Land and Resources Department of Guangxi,considers that rational development and utilization of rare earth resources is an important way to promote economic and social development of Guangxi,which is an underdeveloped area in western China.In addition,making employ of a specialized company to exploit,produce and sell rare earth can also break fundamentally the unordered and fragmented situation of rare earth mining in Guangxi,and can better protect the ecological environment.