China Drills Into the “Roof of the World” to Help Alleviate Foreign Dependence

This article was written by Oilprice.com -- the leading provider of energy news in the world. Also check out these recent articles.

From copper to iron to oil, China is the world's leading importer of almost every raw mineral. Wary of the risks this dependence brings, Beijing is looking ever inward to exploit the mineral wealth of its interior, including the politically contentious and technically challenging Tibetan Plateau. The most recent development is a 7-kilometer deep borehole drilled by Chinese resource exploration teams. The exact location of the borehole, the deepest ever drilled at such a high altitude, as well as the companies involved in the exploration are being kept secret.

The Plateau is estimated to contain 30-40 million tons of copper, 40 million tons of lead and zinc, and billions of tons of high-grade iron ore—it is also estimated that the Plateau's Qiangtang Basin contains upwards of 70 billion barrels of oil, potentially making it the largest such reserve on the planet.  If these estimates are even remotely accurate, the rewards for Beijing will be enormous.


Petroleum and Mineral Deposits of the Tibetan Plateau
 Via Quartz and the Tibetan Plateau Blog

The Tibetan Plateau is the largest and highest plateau on Earth, with an average elevation of more than 4,500 meters above sea level. Mineral extraction faces a series of technical roadblocks if Beijing hopes to move these resources from the interior to the coast for refining and consumption.

"Tibet's altitude and geology make it among the world's most difficult drilling locations. Fragmented [geological] structures, prone to collapse, increase the risks," said Professor Li Haibing, a researcher with the Chinese Academy of Geological Services.

The high altitude makes oxygen scarcity a serious complication for workers, with even light work turning into a strenuous endeavour.  Additionally, the Plateau is located thousands of kilometers from the industrialized coast and suffers a lack of basic infrastructure, let alone the complex framework required for large-scale extraction operations. Due to the technical difficulties of the region, the Tibetan Plateau is one of the last unexplored inland territories on the planet.

But this is not deterring Beijing. While Chinese SOEs have been in the area for over a decade (CNPC began exploring in 1995), there is a new push to see the region developed. Beijing is reviewing a proposal for a new "deep-earth" exploration project that was submitted by some of China's most prominent geologists. As the name would imply, the project involves drilling more than 10 kilometers into the Plateau in order to obtain samples for study. Even if the samples are promising, development of these resources is going to be technically challenging and China does not have a good track record in this area—it has had difficulty tapping its vast shale gas deposits without the help of Western IOCs.

One point of concern that has been raised is the potential for water contamination. The Plateau is also known as the "water tower of Asia," feeding many of the regions critical rivers as well as holding 30 percent of China's freshwater resources. Develop these resources incorrectly, and it could negatively impact hundreds of millions, if not billions, of people.

The Tibetan Plateau may be a mountain of money, but it's too early to tell. Geological uncertainty, technical difficulty, water vulnerability, and politics all complicate production prospects. As Beijing chases self-sufficiency, we can only hope that they don't cut corners.

Say goodbye to 'Made-In-China'
For the first time since the early days of this country, we're in a position to dominate the global manufacturing landscape thanks to a single, revolutionary technology: 3D printing. Although this sounds like something out of a science fiction novel, the success of 3D printing is already a foregone conclusion to many manufacturers around the world. The trick now is to identify the companies -- and thereby the stocks -- that will prevail in the battle for market share. To see the three companies that are currently positioned to do so, simply download our invaluable free report on the topic by clicking here now.

 


Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2908842, ~/Articles/ArticleHandler.aspx, 9/23/2014 6:37:38 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement