Decision No. 104/2007/QĐ-TTg Approves the Master Plan for Exploration, Exploitation, Processing, and Utilization of Ilmenite Ore for the Period 2007-2015 with Orientation to 2025

DECISION OF THE CHAIRMAN OF THE GOVERNMENT

Approving the Plan for Exploration, Exploitation, Processing and Utilization of Titanium Ore

for the period 2007 - 2015 with orientations to 2025

PRIME MINISTER

Based on the Law on the Organization of the Government dated December 25, 2001;

Pursuant to the Law on Minerals, the Law Amending and Supplementing Certain Provisions of the Law on Minerals, and Decree No. 160/2005/NĐ-CP dated December 27, 2005 of the Government detailing and guiding the implementation of the Law on Minerals and the Law Amending and Supplementing Certain Provisions of the Law on Minerals;

Considering the proposal of the Minister of Industry,

DECISION:

Article 1. Approves the Plan for Exploration, Exploitation, Processing and Utilization of Titanium Ore for the period 2007 - 2015 with orientations to 2025, with the main contents as follows:

Clause 1. Views

a) The development of the industry of exploitation and processing of titanium ore must be consistent with the plan for industrial development of Vietnam and the socio-economic development plans of localities. Ensure exploration, exploitation and processing of titanium resources in a thrifty manner, economically efficient, environmental protection, and the combination of economic and social development with national defense and security in areas with titanium minerals.

b) Exploit and process titanium ore in a comprehensive manner to refine it into high-value products, meeting domestic demand, replacing imports; gradually reduce and stop exporting refined ore at the earliest appropriate time.

c) Build and develop the industry of exploitation and processing of titanium ore with modern technology, combining domestic capacity and investment cooperation in training and transferring production technologies for pigment, synthetic rutile, and titanium slag.

Clause 2. Objectives

a) Meet the raw material needs of domestic deep-processing facilities for refined titanium ore. Export a reasonable portion of refined ore in the short term (until 2010) when deep-processing facilities have not yet been invested to contribute to economic and social development in the area.

b) Meet the country's demand for titanium dioxide pigment, reduced ilmenite, and fine zircon powder from 2010 onwards, and export a portion of these products.

c) Prepare complete documentation on reserves, quality, and conditions for exploitation of mines to be put into operation before 2020.

d) Identify industrial-scale exploration and exploitation mines, prohibited and restricted mining areas to ensure that mining activities comply with legal regulations.

3. Content of the Master Plan

a) Reserves and Resources

 Vietnam's titanium ore reserves include confirmed and forecasted ilmenite ore amounting to approximately 34.5 million tons, of which confirmed reserves from level C2 and above are about 14 million tons (41%), and forecasted resources are about 20.5 million tons (59%).

Titanium ore includes two types: primary ore and placer ore: primary titanium ore distributed in Thai Nguyen has forecasted reserves and resources up to 7.8 million tons; placer titanium ore mainly distributed along the coast from Thanh Hoa to Binh Thuan, with confirmed reserves of 9.2 million tons and forecasted resources of about 7.5 million tons.

Accompanying placer titanium ore is zircon ore with reserves of about 1 million tons and forecasted resources of about 2 million tons. Details on forecasted reserves and resources of Vietnamese titanium ore are shown in Appendix I attached.

b) Zoning Planning

- Mining Area

The mining area includes the following regions: Thai Nguyen region; Thanh Hoa - Ha Tinh region; Quang Tri - Thua Thien Hue region; Binh Dinh - Phu Yen region; Binh Thuan - Ba Ria - Vung Tau region.

- Prohibited and Restricted Mining Areas

The People's Committees of provinces and centrally governed cities shall take the lead and coordinate with relevant ministries and sectors to delineate and submit for approval.

c) Exploration Planning

Intensify exploration work for mines or parts of mines at level C2, P1 to meet the requirements for exploitation and processing during the planning period.

The exploration schedule must be carried out in accordance with the schedule for maintaining and putting new mines into operation.

The list and planned schedule for exploration of titanium mines and deposits are detailed in Appendix II attached.

d) Demand for Deep-Processed Products

Forecast of demand for deep-processed titanium ore and zircon products in Vietnam until 2025 (thousand tons).

e) Exploitation and Processing Planning

- Exploitation Planning

During the period 2007 - 2015, exploitation and processing planning will be implemented for industrially-sized mines that have been explored and evaluated. Subsequent phases will mobilize additional mines that have been explored to maintain production levels and ensure the supply of refined ore for deep processing.

- Processing Planning

Based on the scale of reserves, characteristics of the five raw material regions, and market volatility, it is proposed to invest in deep-processing facilities producing titanium dioxide pigment, titanium slag, synthetic rutile, and reduced ilmenite as follows:

+ Invest in ilmenite reduction plants in the Thai Nguyen, Binh Dinh, and Quang Tri regions, expanding according to demand in each phase.

+ Invest in one pigment plant with a capacity of 5,000 tons/year in the first phase and expand to 10,000 tons/year by 2015 in the Binh Thuan region, and one pigment plant with a capacity of 30,000 tons/year in the first phase and expand to 50,000 tons/year in the second phase (after 2015) in the Ha Tinh region.

+ Invest in one titanium slag or synthetic rutile plant with a capacity of 20,000 tons/year in the Thai Nguyen region during the period 2007 - 2015, and expand to 40,000 - 60,000 tons/year during the period 2016 - 2025.

+ Invest in one synthetic rutile or titanium slag plant with a capacity of 30,000 tons/year in the Thua Thien Hue region during the period 2007 - 2015, and expand to 50,000 tons/year after 2015 if there is market demand.

Estimated production of refined ilmenite (thousand tons) according to the planning period as follows:

The above production may be adjusted based on the actual development of the titanium ore exploitation and processing industry and market demand.

4. Investment Capital

The total estimated investment capital for the planning period 2007 - 2025 for exploration, exploitation, and processing of titanium ore is approximately 4,282 billion VND, of which the period 2007 - 2015 is approximately 2,139 billion VND, and the period 2016 - 2025 is approximately 2,143 billion VND. Specifically as follows:

Period 2007 - 2015:

- Investment capital for exploration activities is approximately 94 billion VND, mainly expected to be arranged from the enterprises' own funds.

- Investment capital for mining and processing titanium ore is about 40 billion VND, to be arranged by investors from their own capital, loans, and other forms of capital mobilization.

- Investment capital for pigment plants, ilmenite recovery plants, titanium slag plants, and synthetic rutile plants is approximately 20,450 billion VND, to be arranged from the enterprises' own funds.

For the period 2016-2025: it is estimated that investment capital for exploration, mining, and processing will be around 2,143 billion VND. The details of the investment capital are shown in Appendix V attached hereto.

5. Measures and policies for implementation

- Measures

+ Specific measures on capital mobilization

Geological exploration, mining works, and processing facilities: utilize commercial loans and enterprises' self-arranged funds.

+ Management and development of titanium ore potential

. Complete the digital data management system for titanium ore resources nationwide for national storage;

. Intensify exploration work to prepare resources for projects to be put into operation during the 2007-2015 period and have sufficient grounds for implementing and adjusting the planning for this period.

+ On mining and using titanium ore

. The People's Committee of Ha Tinh Province directs the Ha Tinh Mineral and Trade Corporation to accelerate the progress of the pigment plant construction project in Ha Tinh;

. The People's Committee of Thua Thien Hue Province directs the Hue Mineral Company to implement preparatory work for deep processing projects of titanium ore according to the planning;

. Promote international cooperation in the field of deep processing technology of titanium ore and associated elements.

+ Infrastructure measures

Invest in building technical infrastructure networks outside the perimeter at mining and deep processing areas of titanium ore.

- Policies

+ On management mechanism for implementation of planning

Develop policies for the use and trade of titanium ore exports with the principle of saving and rational use of resources, enhancing the economic efficiency of titanium ore mining and processing, ensuring harmony between local socio-economic development and increasing the economic value of titanium ore.

+ On finance

Create mechanisms and policies to encourage investment in line with the integration roadmap for deep processing projects. Provide budget funding for building technical infrastructure networks outside the perimeter at mining and deep processing areas of titanium ore.

+ On human resources

Have policies for training and attracting management cadres and geological, mineral prospecting, and mining science professionals to carry out exploration, mining, and deep processing projects of titanium ore within the country.

+ On international cooperation

Reform policies and investment environment to attract foreign investment in the field of deep processing of titanium ore with the aim of attracting capital, absorbing, and transferring new technologies.

Article 2. Implementation

1. The Ministry of Industry shall be responsible for announcing and organizing the implementation of this planning after approval by the Prime Minister. Regularly update and keep the implementation situation current and adjust the planning to ensure synchronization and suitability with the country's socio-economic development and international integration process. Propose mechanisms and policies to develop the titanium ore mining and processing industry stably and sustainably.

2. The Ministry of Natural Resources and Environment shall establish and submit to the Prime Minister for approval the Planning for Basic Geological Survey on Titanium Ore Mineral Resources and direct its implementation.

3. The Ministry of Planning and Investment, the Ministry of Finance shall balance the budget to implement the basic survey program of titanium ore resources nationwide, invest in building technical infrastructure networks outside the perimeter at large mines and titanium processing areas in Ha Tinh and Binh Thuan.

4. The People's Committees of provinces and centrally-administered cities shall be responsible for managing and protecting titanium ore resources in their jurisdictions when the mines do not yet have owners, prevent illegal mining and export of titanium ore. Organize the establishment and submission to the People's Councils at the same level for approval of the planning for exploration, mining, processing, and use of titanium ore for mines under their licensing authority.

Article 3. This Decision takes effect 15 days after its publication in the Official Gazette.

Article 4. THE MINISTERS, HEADS OF GOVERNMENT-LEVEL MINISTRIES, HEADS OF GOVERNMENT-LEVEL AGENCIES, AND CHAIRMEN OF PROVINCE AND CITY PEOPLE'S COMMITTEES DIRECTLY UNDER THE CENTRAL GOVERNMENT SHALL BE RESPONSIBLE FOR ENFORCING THIS DECISION./.