Suntrans Dr. Lyu Guo on Reviving “Dead & Idle Mines”: A Strategic Breakthrough for China's Resource Security

Dr. Lü Guo of Suntrans and his team have long been engaged in translation and consulting services for the mining and energy sectors, consistently focusing on structural challenges facing China’s mining industry. In his view, the structural inversion formed by 67,000 idle and defunct mines and 43,000 existing mineral rights in China, coupled with the quantity imbalance between 12,646 exploration rights and 30,391 mining rights, is no longer merely an industrial issue. It constitutes a systemic challenge bearing on national resource security, economic stability and social governance, whose remediation brooks no delay.

I. Multiple Risks of Idle and Defunct Mines: More Than Just Strategic Hazards from Idle Assets

According to Dr. Lü Guo of Suntrans, idle and defunct mines are by no means synonymous with “ineffective assets”, and their adverse impacts are spreading in multiple dimensions. From the perspective of resource strategy, these mines hold large volumes of proven high-quality resources yet remain idle for a long time. They cannot achieve reserve expansion and production growth through “prospecting around known deposits”, and directly widen the supply gap of mineral resources. This runs counter to China’s strategic needs amid global resource competition, forming latent perils threatening national resource security.

Economically, massive upfront investments have turned into sunk capital. Coupled with conflicts arising from the dual nature of mineral rights — administrative licensing power plus usufructuary rights — market-based revitalization is hindered. This further triggers cascading problems including corporate chain debts and tax arrears, seriously dampening the confidence of social capital in investing in the mining sector. More alarmingly, accumulating issues such as employee unemployment and debt disputes easily spark petitions, lawsuits and other social conflicts. Local governments are trapped in a governance dilemma of “chaos upon deregulation, stagnation upon strict control”, which to some extent undermines government credibility. This makes idle and defunct mines “risk bombs” lurking within the industry and society.

At the level of international layout, the “zombie” status of idle and defunct mines severely weakens confidence in China’s mining industry and restricts its “Going Global” pace. Dr. Lü Guo stresses that global resource competition is intensifying. A healthy domestic mining ecosystem serves as the foundation for international expansion, and the prolonged existence of idle and defunct mines undoubtedly places China’s mining sector at a disadvantage in global competition.

II. The Urgency of Revitalization: A Strategic Mandate for Multi-dimensional Development

Dr. Lü Guo of Suntrans holds that revitalizing idle and defunct mines is no longer an “optional task”, but a mandatory assignment requiring full promotion, whose strategic value extends far beyond the industry itself. Economically, conservatively estimated at an upfront investment of RMB 50 million per idle mine, revitalizing 10,000 such mines can unlock RMB 500 billion in sunk capital and convert it into assets worth RMB 2–10 trillion in market value. Verified resources can also be added to national asset accounts, helping local governments optimize liability structures and offset lost tax revenue.

Socially, resuming production can directly re-employ laid-off workers. Restored cash flow will effectively resolve corporate chain debts, eliminate long-standing hidden risks to social stability and rebuild a sound environment for local governance. From the perspective of industrial development, revitalization can boost liquidity in the mining market, attract the return of social capital, and promote standardized and professional exploration and mining. It can also reinforce industry confidence and lay a solid foundation for the international layout of China’s mining sector.

Particularly with the implementation of the revised Mineral Resources Law of the People’s Republic of China in 2025, Dr. Lü Guo argues that bringing revitalization work onto a legal track constitutes a key measure to drive high-quality mining development and strengthen the shield of resource security. Its urgency has risen to the level of national strategy.

III. Practical Dilemmas: Dual Bottlenecks in Institutions and Implementation

Despite consensus on the value of revitalization, Dr. Lü Guo’s industrial practice shows that revitalization efforts still face two core obstacles. At the legislative level, while the revised Mineral Resources Law establishes an overarching framework, its provisions remain largely principled, and supporting administrative regulations and ministerial rules have not been rolled out synchronously. This creates barriers to law enforcement. More prominently, legislation covering land use, forest occupation, water access, safety, environmental protection and other fields involved in mineral development lacks coordination. Phenomena such as “holding mineral rights but lacking land use rights” and “holding permits yet unable to commence production” are prevalent. Institutional fragmentation severely constrains revitalization progress.

On the practical front, one-size-fits-all mine closures driven by arbitrary administrative will are a major cause of idle and defunct mines. From the shutdown of 138 manganese mining enterprises in Chongqing to the one-off closure of 415 mineral rights in Sichuan, such simplistic operations, essentially “risk-avoidance governance”, land revitalization in an implementation deadlock: projects require government support yet no authority dares to make final decisions. Dr. Lü Guo of Suntrans states that this is the most prominent practical resistance he has witnessed in industry practice. The risk-averse priority orientation of local governments means many projects eligible for revitalization cannot be launched for a long time.

IV. Solutions for Breakthrough: Two-pronged Efforts via Institutional Coordination and Practical Innovation

Drawing on years of industry experience and research, Dr. Lü Guo of Suntrans proposes that resolving the deadlock of idle and defunct mines requires systematic thinking of “institutional breakthrough + practical advancement”. Institutionally, a cross-departmental coordinated legislative mechanism should be accelerated. Supporting rules covering land use, environmental protection and safety shall be refined synchronously with the revised Mineral Resources Law. Clear definition of the boundary of mineral rights and approval procedures, together with special guidelines for resolving legacy issues of idle and defunct mines, will enable enterprises to carry out revitalization in accordance with rules and laws, fundamentally solving the predicament of “no basis to follow and obstacles everywhere”.

In practice, the core is to reverse the “risk-averse priority” orientation. Dr. Lü Guo suggests that apart from establishing and improving a fault-tolerance and error-correction assessment mechanism to ease local leaders’ accountability concerns, the performance of idle mine revitalization should be incorporated into local assessment systems for resource utilization efficiency and high-quality development. Positive incentives will guide local governments to shift from passive response to active service. Meanwhile, third-party professional institutions may be introduced to participate in project evaluation, risk control and coordinated advancement, reducing subjectivity in administrative intervention and improving the scientific rigor and efficiency of revitalization work.

From an international perspective, Dr. Lü Guo further proposes that revitalization of idle and defunct mines can be deeply linked to China’s mining “Going Global” strategy. Mature experience accumulated from domestic revitalization projects in green development, technological upgrading and compliance management can be replicated and promoted in overseas mining cooperation projects, forming a two-way pattern of “domestic revitalization for quality improvement + international expansion for empowerment”, and enhancing the global competitiveness and resource guarantee capacity of China’s mining industry.

Dr. Lü Guo notes that as practitioners in the mineral resources sector, his team will continue to follow the revitalization progress of idle and defunct mines, actively help build communication bridges between enterprises and governments, promote the implementation of relevant institutions and practical innovation, unlock greater value from stock resources, and contribute professional strength to the high-quality development of China’s mining industry and the long-term safeguarding of national resource security.