Investment Decision Study On Overseas Mining Projects Of Chinese Mining Enterprises

Mineral resources are the material basis of human civilization progress, economic and social development, as well as scientific and technological revolution. Owing to the uneven distribution of mineral resources around the world, not a single country can achieve self-sufficiency from its own mineral resources, completely independent of any other countries in the world. As the industrialization and urbanization of China accelerating constantly, the increasing demand for mineral resources comes after; and yet insufficient is the capacity of domestic mineral resources supply, especially the daily needs of people, such as oil, gas, steel, copper, and potassium, along with the industrial minerals production. The shortage of the domestic supply can not only seriously affect China's economic development, but also national security. For the purpose of securing an adequate resources supply and ensuring the national economic security, Chairman Jiang proposed making full use of "Two Resources, Two Markets" in 1997, and in the same year, "Go Global" strategy formed at national foreign capital meeting. This strategy is particularly necessary and urgent in the current. Meanwhile, it should be noted that global finance, and mergers and acquisitions have become the trend for large international mining companies. Based on the background, it is significant and directive for China's mining enterprises, when adopting the "Go Global" strategy, to make investment decisions and deployment, and to take the specific actions and strategy.The author points that China's "Go Global" strategy has been lagged far behind many developed countries in the world, missing the best period for overseas expansion. Compared with other big mining countries, China's "Go Global" gap is distinct. Investment on overseas mining projects of Chinese mining enterprises should pay more attention to the four aspects. Through the research of second chapter, third chapter, fourth chapter and the fifth chapter, Proposed the foreign investment of Chinese mining enterprises must consider primary coverage plan and strategy in the summary compares and profits from the overseas experience procedure foundation. Significant and partially innovative progress and results are as follows:First, before overseas mining enterprises in China "Go Global", a lot of detailed research work on due diligence is done, listing the possible problems at early stage, and then putting forward solutions to them. This paper conduct comprehensive research and study on the target company's historical background, development, finance, credit and debt, litigation disputes, real estate, project mining tenements, water, supply, sales and distribution, indigenous rights and cultural heritage, together with the research and study on the target country's political, legal, investment environment, environmental regulations, intellectual property, employment relation, contractual agreements, insurance, information technology and database, technology and some other aspects, so as to take the initiative in the risk control and reduce the future operational risk of the enterprise.Second, directing towards the current situation that mining enterprises for foreign investment in China is in the early stage and their overseas development and co-operation with foreign enterprises are irrational, this paper discusses the importance of decision-making role on the assessment of mining projects in the mining investment. According to the research on the issues related to foreign mining project evaluation and specific case studies, assessment of proposed mining projects is an very important part to mining enterprises in the exploration, development feasibility, approval, financing, mine construction , production and other fields, since it covers a wide field, highly professional, and requests high of the staff. This paper compares the domestic distinct stages of mining projects (from the exploration stage, the approval stage, the financing stage, the financing summary stage, etc.) and the investor's investment approach, resources and reserves, with those of the foreign mining projects at details. Furthermore, using London mining as an example, the paper introduces its experience of practice on equity financing, project acquisition and sale, floating on the stock market. Also, in-depth comparative study between home and abroad is done on mining project evaluation purpose and assessment methods. Finally, we analyses issues on the mining investment risks and potential, investment decision-making, and evaluation summary in depth.Third, combining the author's work experience, the understanding of development model from large, medium or small-scale foreign mining enterprise, and the background of domestic mining enterprises, this paper establishes development and external-support model for mining enterprises, suited for their different development stages. The model consequently provides a guarantee mechanism for Chinese overseas mining companies. When we establish the internal "Go Global" model - "pyramid" model and the external associations which effectively support themselves, establish private capital investment market, and build the strategic talented-person cooperation platform between colleges and enterprises as well as an international shipping and land route platform, the protection is provided for the Chinese mining enterprises to make investment decision.Fourth, the use of economic instruments (mathematical models) reduces international investment risk for Chinese mining enterprises, enhances expertise in the international arena, builds capital environment overseas, makes use of international capital market, takes advantage of "Two Markets, Two Resources", provides inspiration on the sustainable development of mining industry, and enhances the international competitiveness...