Countries of the World/COUNTRYS.BIN/dp/0083/00837.txt

Text File | 1991-06-24 | 23KB | 379 lines

$Unique_ID{COW00837}
$Pretitle{260}
$Title{China
Chapter 7C.   Heavy Industries}
$Subtitle{}
$Author{Michael L. Waddle}
$Affiliation{HQ, Department of the Army}
$Subject{china
power
oil
percent
china's
enterprises
coal
development
industry
large}
$Date{1989}
$Log{}
Country:     China
Book:        China, A Country Study
Author:      Michael L. Waddle
Affiliation: HQ, Department of the Army
Date:        1989

Chapter 7C.   Heavy Industries

Mining

Coal

     In the first half of the twentieth century, coal mining was more developed
than most industries. Such major mines as Fushun, Datong, and Kailuan produced
substantial quantities of coal for railroads, shipping, and industry. Expansion
of coal mining was a major goal of the First Five-Year Plan. The state invested
heavily in modern mining equipment and in the development of large, mechanized
mines. The "longwall" mining technique was adopted widely, and output reached
130 million tons in 1957.

     During the 1960s and 1970s, investment in large mines and modern equipment
lagged, and production fell behind the industry's growth. Much of the output
growth during this period came from small local mines. A temporary but serious
production setback followed the July 1976 Tangshan earthquake, which severely
damaged China's most important coal center, the Kailuan mines. It took two years
for production at Kailuan to return to the 1975 level.

     In 1987 coal was the country's most important source of primary energy,
meeting over 70 percent of total energy demand. The 1984 production level was
789 million tons. More than two-thirds of deposits were bituminous, and a large
part of the remainder was anthracite. Approximately 80 percent of the known coal
deposits were in the north and northwest, but most of the mines were located in
Heilongjiang Province and east China because of their proximity to the regions
of highest demand (see fig. 14).

     Although China had one of the world's largest coal supplies, there still
were shortages in areas of high demand, mainly because of an inadequate
transportation infrastructure. The inability to transport domestic coal forced
the Chinese to import Australian coal to south China in 1985. The industry also
lacked modern equipment and technological expertise. Only 50 percent of
tunneling, extracting, loading, and conveying activities were mechanized,
compared with the 95-percent mechanization level found in European nations.

Iron Ore

     China had iron-ore reserves totaling approximately 44 billion tons in 1980.
In the mid-1980s, however, China relied on imports because of domestic
transportation and production problems. Sizable iron-ore beds are distributed
widely in about two-thirds of China's provinces and autonomous regions. The
largest quantities are found in Liaoning Province, followed by Sichuan, Hebei,
Shanxi, Anhui, Hubei, Gansu, Shandong, and Yunnan provinces and Nei Monggol
Autonomous Region.

     In the mid-1980s mines lacked modern excavation, transportation, and
ore-beneficiation equipment. Most of the ore mined had a low iron content and
required substantial refining or beneficiation before use in blast furnaces.
Most mines lacked modern plants for converting low- grade iron ore into
concentrated pellets.

Other Minerals and Metals

     After 1949 geological exploration discovered deposits of more than 130
useful minerals. China is among the world leaders in proven deposits of
tungsten, antimony, rare earth metals, molybdenum, vanadium, titanium, pyrite,
gypsum, barite, copper, tin, lead, zinc, aluminum, mercury, manganese, nickel,
phosphorus, asbestos, fluorite, magnesite, and borax. Of these, China exported
antimony, tin, and tungsten in significant quantities. In general, mineral
extraction was inadequate for industrialization because of transportation
bottlenecks and shortages of modern equipment for mining, smelting, and
refining. A number of important mineral products were imported despite large
domestic deposits, including aluminum, copper, and zinc.

     Among the rare earth metals and ferroalloys, beryllium, tungsten,
molybdenum, barium, manganese, mercury, niobium, zirconium, and titanium were
present in large reserves and were extracted in adequate quantities.
Deficiencies existed in chromium, platinum, and gold.

     China produced sufficient quantities of most nonmetallic minerals to meet
domestic needs. Barite, fluorite, salt, and talc were available in massive
reserves and were exported in large quantities. Graphite, magnesite, phosphates,
and pyrite were less abundant but generally satisfied domestic demand. Sulfur
deposits were large, but quality was low and imports were necessary.

     China is rich in uranium and has favorable geological conditions for the
formation of uranium deposits. The ore is easy to mine and dress because of its
relatively simple physical composition.

Energy

Oil and Natural Gas

     Before 1949 China imported most of its oil. During the First Five-Year Plan
it invested heavily in exploration and development of wells. In 1959 vast
reserves were discovered in the Songhua Jiang (Sungari River)-Liaohe Basin in
northeast China. The Daqing oil field in Heilongjiang Province became
operational in 1960. Daqing was producing about 2.3 million tons of oil by 1963,
and it continued to lead the industry through the 1970s. Further important
discoveries, including the major oil fields of Shengli (in Shandong Province),
and Dagang (in Tianjin special municipality) enabled China to meet domestic
needs and eliminate nearly all imports by the mid-1960s (see fig. 15). In 1973,
despite a steadily growing internal demand for petroleum products, output was
large enough to export 1 million tons of crude oil to Japan. Exports increased
to 6.6 million tons in 1974 and reached 13.5 millions tons in 1978. In 1985
exports of crude oil amounted to approximately 20 million tons, roughly 16
percent of total production. The majority of 1985 exports were to Japan, but the
government also had released increasing quantities on the spot market and sent
some to Singapore for refining. Although the government temporarily abandoned
its drive to broaden its oil export base in 1986, 130.7 million tons of crude
oil still were produced, an increase of 5.8 million tons over 1985.

     Oil reserves are large and widely dispersed. In general, development is
concentrated on deposits readily accessible from major industrial and population
centers. Deposits in remote areas such as the Tarim, Junggar, and Qaidam basins
remain largely unexplored. The quality of oil from the major deposits varies
considerably. A few deposits, like the Shengli field, produce low-quality oil
suitable mainly as fuel. Most of the oil produced in China from the big fields
in the north and northeast is heavy, is low in sulfur, and has a very high
paraffin content, making it difficult and expensive to extract and to refine.

     Offshore exploration and drilling were first undertaken in the early 1970s
and became more widespread and advanced as the decade progressed. Chinese and
foreign oil experts believed that offshore deposits were extensive and could
equal onshore reserves. Offshore operations relied heavily on foreign
technology. In 1982 thirty-three foreign oil companies submitted bids for
offshore drilling rights; twenty- seven eventually signed contracts. By the
mid-1980s, when offshore exploration results were disappointing and only a
handful of wells were actually producing oil, China began to emphasize onshore
development. To continue offshore exploration, China established the China
National Offshore Oil Corporation to assist foreign oil companies in exploring,
developing, extracting, and marketing China's oil.

     Offshore exploration and drilling were concentrated in areas in the South
China Sea, Gulf of Tonkin, and Zhu Jiang (Pearl River) Delta in the south, and
the Bo Hai Gulf in the north. Disputes between China and several neighboring
countries complicated the future of oil development in s