BIZCHINA> Review & Analysis
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BIZCHINA> Review & Analysis
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Fully price resources
(China Daily)
Updated: 2006-11-30 10:58 The pilot reform to charge for mining and exploration rights is not only crucial to the sustainable development of the coal mining industry, but also sets an example for other resources producers.
If China is to bid farewell to extensive economic growth, such efforts to factor environmental and social costs in the pricing of resources are more than needed. The central government recently decided to stop offering "free lunch" for coal mine developers in eight coal-rich provinces. All mining and exploration rights newly available in those areas must be obtained through tenders or auctions. Enterprises that have already acquired such rights for free will have to pay after their remaining coal reserves are assessed. Besides, the country will also establish a system of responsibility to manage its coal mines, which will require new mines to set aside part of their revenues for environmental protection. Coal consumption in China, the world's No 1 coal producer and consumer, accounts for about 70 per cent of the nation's total unrenewable energy consumption. In the first 10 months of this year, China's coal output hit 1.67 billion tons, up 12.2 per cent over the same period last year. However, coal mine developers used to acquire mining rights via administrative examination for nominal or no fees. Low thresholds for investing in coal mines, to a certain extent, has fuelled wasteful and predatory mining activities in recent years as market demand for coal soared. (For more biz stories, please visit Industries)
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