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	NOTICE OF THE MINISTRY OF LAND AND RESOURCES CONCERNING THE EVALUATION AND CONFIRMATION OF MINING RIGHT

	(September 2, 2002)


SUBJECT : MINING RIGHT; EVALUATION AND CONFIRMATION
ISSUING DEPARTMENT : MINISTRY OF LAND AND RESOURCES OF THE PEOPLE'S REPUBLIC OF CHINA
ISSUE DATE : 09/02/2002
IMPLEMENT DATE : 09/02/2002
LENGTH : 494 words
TEXT :

Since the promulgation of the Guidance for Evaluation of Mining Right (Announcement No. 8 [2001] of the Ministry of Land and Resources of the People's Republic of China), the evaluation and confirmation of mining right have been regulated, the construction of mining right market has been promoted, and achievements have been made. However, in the practice of evaluation and confirmation, some issues are found to be in need of further amendment and improvement. Upon study, we hereby give our notice on the relevant issues as follows:

I. There shall be legitimate basis for selecting all parameters such as data of reserves, cost parameter, etc.; the evaluation institution must, when amending the original parameters provided by the provider, have reliable basis, and shall sufficiently state the reasons for the amendment.

II. The proven and controlled reserves, the basic reserves and the amount of resources within the scope of a mining area shall all be counted into the price of the mining right. The presumed and expectant amount of resources shall be counted into the price of the mining right on the basis of the utilization of mine enterprises and the utilization of design, selecting the reliability coefficient for the amount of resources separately when counting. The reliability coefficients for the amount of resources shall be between 0.5-0.8. The concomitant mine variety which may be comprehensively utilized shall be counted into the price of the mining right together with the main mine variety.

III. The reserves shall mean the minable part in the basic reserves, which are the actual minable amount with the losses in design and exploitation being deducted, and on the basis of which the price of mining right shall be calculated.

IV. When the service period of a coal mine is calculated, the prepared coefficients (K) of unequal reserves shall be selected upon particulars such as the type of the basic reserves and amount of resources, the extent of the complicacy of the geologic structure of mineral deposit and different means of mining. However, once the (111) reserves are used, the prepared coefficients of reserves shall no longer be used for adjustment.

V. The exploitation scope of a mine enterprise shall conform to the scale of its reserves. The service period of the project on evaluating the mining right shall generally not be more than 30 years. For the mining right the mine areas formed upon investments of the state, if the service period is more than 30 years, the price of the mining right may be evaluated by means of evaluation in subsections, that is, only the reserves under planned initial use are regarded as the base.

VI. Depreciation expenses shall be drawn from the fixed assets formed from shafting and drifting engineering according to the service period. The shafting and drifting maintenance fee, as well as other fees that may be evaluated but were listed in the maintenance and check fee before, shall be embodied in all items of cost parameters.