Lao mining sector eyes larger output
Lao mining sector eyes larger output
A recent report from the Ministry of Energy and Mines reveals that production in the mining sector is expected to increase in value this fiscal year, though the slump in the global ore price is still reflected in Laos' mining output.
The ministry's report states that production in the mining sector is expected to increase in value to about 14.785 trillion kip in fiscal year 2014-15.
The growth rate will be about 12.66 percent more than last fiscal year, the report noted.
To achieve this goal, the ministry reported that the sector will have to produce larger quantities of important ores. Target figures include include 24.88 tonnes of mixed gold and silver ore, 91,600 tonnes of copper ingot, 350,000 tonnes of copper ore, 470,000 tonnes of potash ore, 1,200 tonnes of lead ore, and 600,000 tonnes of gypsum.
But a current downturn in the world ore price caused the output value of the Lao mining sector to drop by almost 9 percent in the 2013-14 fiscal year compared to the previous year.
Output in the mining sector fell by 8.88 percent, the ministry reported.
The sharp drop in production value in the mining sector in 2013-14 was largely caused by the cessation of gold mining at the MMG LXML Sepon gold and copper plant, when it was impacted by the falling global ore price.
Another significant factor was the stoppage of production at the Viengphoukha coal mine in Luang Namtha province when the concession agreement ended.
The slump in ore prices affected gold, potash and copper, and no new mining ventures replaced the lost production.
The gold price began falling in the third and fourth quarters of fiscal year 2012-13, dropping to US$1,200 - US$1,300 per ounce, and significantly impacted gold production in Laos.
The mining sector produced about 30.01 tonnes of gold and silver in 2013-14 – an increase of 36.8 percent on 2012-13, but the market price dropped by about 29.15 percent.
Both local companies and overseas investors operate mines in Laos, including investors from Asean countries.
As of September this year, there were 69 companies operating 107 mining projects on a total area of 274,663 hectares in Laos, the ministry's report noted.
Mining operations fall into two main groups: one group excavates ore and processes it. This group comprises 50 companies operating gold, copper, coal, lead, potassium and gypsum mines.
Companies in the other group are preparing to begin excavation and the construction of processing factories.
This group comprises 19 companies who will operate gold mines in Vientiane, Attapeu and Borikhamxay provinces.
