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No. MINISTRY OF ENERGY AND MINES THE LAO PEOPLE’S DEMOCRATIC REPUBLIC THE GEOLOGICAL MAPPING AND MINERAL INFORMATION SERVICE PROJECT FOR PROMOTION OF MINING INDUSTRY IN THE LAO PEOPLE’S DEMOCRATIC REPUBLIC FINAL REPORT Volume II : Main Report October 2008 JAPAN INTERNATIONAL COOPERATION AGENCY MITSUBISHI MATERIALS TECHNO CORPORATION KOKUSAI KOGYO CO., LTD. IL JR 08-042 PREFACE In response to a request from the Lao Peoples Democratic Republic, the Government of Japan decided to conduct a study on ³The Geological Mapping and Mineral Information Service Project for Promotion of Mining Industry in the Lao Peoples Democratic Republic´ and entrusted to the study to the Japan International Cooperation Agency (JICA). JICA selected and dispatched a study team headed by Mr. Yoshiaki Shibata of Mitsubishi Materials Techno Corporation and consists of experts from Mitsubishi Materials Techno Corporation and Kokusai Kogyo Co., Ltd. between March 2006 and October 2008. The study team conducted field surveys in the study area and held discussions with the officials concerned of the Government of the Lao Peoples Democratic Republic. This final report was completed in October 2008. I hope that this report will contribute to the promotion of mining development in the Lao Peoples Democratic Republic and to the enhancement of friendly relationship between our two countries. Finally, I wish to express my sincere appreciation to the officials concerned of the Government of the Lao Peoples Democratic Republic for their close cooperation extended to the study. Mr. Seiich Nagatsuka Vice President Japan International Cooperation Agency October 2008 October 2008 Mr. Seiich Nagatsuka Vice President Japan International Cooperation Agency Tokyo, Japan Letter of Transmittal Dear Sir, We are pleased to submit herewith a final report of ³The Geological Mapping and Mineral Information Service Project for Promotion of Mining Industry in the Lao Peoples Democratic Republic´. In Lao PDR, potentials of mineral resources such as gold, silver, copper, lead and zinc are expected to be very high. Mining development of these mineral resources can earn foreign currency income in future. However, mining investment has not been active for mineral potentials because information of domestic mineral resources and investment climate are not prepared well enough. In order to accelerate investment in mining of Lao PDR, the study team and Laotian counterparts prepared information of geology and mineral resource of LAO PDR and disseminated the prepared information domestically and internationally during the project term from March 2006 to October 2008. Capacity development of Department of Mines and Department of Geology of the Ministry of Energy and Mines was also implemented at the same time during the project period. The team hopes the information prepared by the Project will be utilized for mineral exploration and development in future and engineers trained by the project will contribute further to enhancement of institutional capacity. We would like to express our heartfelt appreciation to the people of Lao PDR for their active participation in the study, especially the Ministry of Energy and Mines, the Department of Mines and the Department of Geology. We also deeply indebted to the officials of JICA, the Ministry of Economy, Trade and Industry, the Ministry of Foreign Affairs, the Embassy of Japan in Lao PDR, and the JICA office in Lao PDR for their continuous support throughout the Project. Finally, we hope that our outputs will contribute to development of mining sector of Lao PDR and to fostering a long-lasting partnership and friendship between Japan and Lao PDR. Yours faithfully, Yoshiaki Shibata Leader of the JICA Study Team THE GEOLOGICALMAPPING AND MINERAL INFORMATION SERVICE PROJECT FOR PROMOTION OF MINING INDUSTRY IN THE LAO PEOPLE¶S DEMOCRATIC REPUBLIC FINAL REPORT Table of Contents Location Map Page CHAPTER 1 INTRODUCTION......................................................................................... 1-1 1.1 Preface................................................................................................................. 1-1 1.2 Background ofthe Survey ...................................................................................... 1-1 1.3 Objectives of the Survey......................................................................................... 1-1 1.4 Study Area............................................................................................................ 1-1 1.5 Organization of Implementation .............................................................................. 1-1 1.6 Plan of the Survey ................................................................................................. 1-2 1.7 Progress ofthe Project............................................................................................ 1-2 1.7.1 Preparation Work (March 2006).................................................................. 1-2 1.7.2 The 1st Field Survey (May-June 2006)......................................................... 1-3 1.7.3 The 2nd Field Survey (September-December 2006)....................................... 1-3 1.7.4 The 3rd Field Survey (January-March 2007)................................................. 1-3 1.7.5 The 4th Field Survey (June-July 2007)......................................................... 1-3 1.7.6 The 1st Study in Japan (October 2007)......................................................... 1-4 1.7.7 The 5th Field Survey (October~ December 2007).......................................... 1-4 1.7.8 The 2nd Study in Japan (December 2007) .................................................... 1-4 1.7.9 The 6th Field Survey (January~ March 2008)................................................ 1-4 1.7.10 The 7th Field Survey (March 2008)............................................................. 1-4 1.7.11 The 3rd Study in Japan (May 2008) ............................................................. 1-4 1.7.12 The 8th Field Survey (June~August 2008).................................................... 1-4 1.7.13 The 4th Study in Japan (September 2008) .................................................... 1-5 1.8 Majortopics during theProject................................................................................ 1-5 1.9 Member List of the Project ..................................................................................... 1-6 CHAPTER 2 PRESENT MININGACTIVITIES IN LAO PDR.............................................. 2-1 2.1 Introduction.......................................................................................................... 2-1 2.2 Mining Policy ....................................................................................................... 2-1 2.2.1 Principle of MiningPolicy ............................................................................. 2-1 2.2.2 Legislation and Regulation in Mining.............................................................. 2-2 - i - 2.3 Investment Climate and Present Situation ................................................................. 2-4 2.3.1 Transportation .............................................................................................. 2-4 2.3.2 Telecommunication....................................................................................... 2-4 2.3.3 ElectricPower.............................................................................................. 2-5 2.3.4 Present Situation of Investment for Mining Sector............................................. 2-6 2.4 Mineral Production................................................................................................ 2-9 2.4.1 Gold and Silver............................................................................................. 2-9 2.4.2 Copper........................................................................................................ 2-9 2.4.3 Zinc............................................................................................................ 2-10 2.4.4 Gypsum....................................................................................................... 2-10 2.4.5 Coal............................................................................................................ 2-11 2.5 Mineral Prospecting............................................................................................... 2-12 2.6 Mine Development and Mineral Exploration............................................................. 2-12 2.6.1 Sepon Mine.................................................................................................. 2-12 2.6.2 Phu Kham Copper-Gold Mine........................................................................ 2-14 2.6.3 Other Exploration Projects............................................................................. 2-16 CHAPTER 3 DATAREVIEW OF GEOLOGY AND MINERAL RESOURCES....................... 3-1 3.1 Introduction.......................................................................................................... 3-1 3.2 Existing 1:1,000,000 Geological and Mineral Resources Map ..................................... 3-1 3.3 Mapping Program for1:200,000 Geological and Mineral Resources Map ..................... 3-1 3.3.1 Northern Part................................................................................................ 3-1 3.3.2 Central Part.................................................................................................
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