Mining sector still poorly managed

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VietNam News English - 44 month(s) ago 8 readings

Nguyen Thanh Son, director of the Red River energy project under the VN National Coal and Mineral Industries Holding Corporation, tells Tien Phong (Vanguard) newspaper that legal loopholes are resulting in waste of mineral resources.

The method of issuing operational licences to mineral exploitation companies is changing from the ask-and-give mechanism to auctions. Will this change help the State discontinue the waste and over-exploitation of mineral resources?

We thought everything would be okay when the Mineral Law was issued in 1996 and then amended in 2005. But when looking back, we find that there has been a lot of waste of mineral resources.

The current law still contains many loop-holes. For instance, local newspapers reported recently that Thanh Hoa Province People's Committee had granted an operation licence to a company to exploit only 120,000 tonnes of iron ore in Ba Thuoc District but it also decided to allocate 254ha of land retrieved from the locals to the company. This is a big waste of 254ha of land for the exploitation of only 120,000 tonnes of iron ore over three years. The State could only expect a return of about US$5 million.

There are still no clauses in the law specifically regulating mineral processing in combination with mining, while the concepts of ‘enriching minerals' and ‘exhausting minerals' are included. This creates loop-holes for mineral exploitation companies to seek quantity, cause waste in mineral resources and fail to prevent raw minerals from being exported because the law does not refer to processing as a separate and crucial regulation.

The Ministry of Natural Resources and Environment is collecting opinions to complete a draft decree as guidance for implementation of the Mineral Law. The draft will come into effect on July 1. Which regulations should the draft amend?

I am more concerned that the draft should cover not only loop-holes to prevent mineral exploitation companies from dodging the law but also clear obstacles for its implementation.

For example, it is not feasible to prioritise mineral exploitation companies to obtain their operation licences in less than 18 months if they do exploration first because they will not be able to set up mineral exploitation projects if exploration results are not approved. This also means they cannot do the exploitation.

It is also not feasible to separate exploration from exploitation because no company will pour money into exploration if they are not sure they will be allowed to exploit any minerals they find. The two should be combined.

The draft should separate unexplored minerals from explored ones. The State should hold bidding for explored minerals and auctions for unexplored minerals. This will avoid risks to both the companies and the State. — VNS

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