From the Sino-NK Archives (22) – 28.04.2014 – Vanadium and Socialism: Rare Earth Prospecting, Politics, and History in North Korea

Mining-in-North-Korea

Mining in the era of Songun | Image : Rodong Sinmun

Vanadium and Socialism: Rare Earth Prospecting, Politics, and History in North Korea

by Robert Winstanley-Chesters

When the faintly mysterious private equity vehicle SRE Minerals Ltd announced the creation of Pacific Century Rare Earth Mineral Limited, a joint venture with the DPRK’s Korea Natural Resources Trading Corporation, in December 2013, it set the analytic cat amongst the speculative pigeons in a fashion not unfamiliar in the world of North Korean reportage.

From Yongju to Jang | The discovery and analysis of the “Yongju Deposit” accordingly to SRE, Pacific Century and other analysts could mean that North Korea sits astride some 216 million tonnes of Rare Earths (and some 5.7 million tonnes of what the report excitedly branded “the more valuable heavy rare earth elements”) worth trillions in both dollars and geo-strategic import. If realized, the deposit would make North Korea one of the richest nations in the neighborhood, radically alter the market for Rare Earths, impacting enormously on its key players (namely the United States and China), and serve as a massive financial reserve for the North Korean government, one that could conceivably underpin its ideological and social system without reform in perpetuity.

All this sparked confusion, exasperation, intrigue and disbelief in almost equal measure. However, it was quickly overtaken by an event that it could even have spurred: the execution of Jang Song-taek. Of course, the death and narrative obliteration of Uncle Jang and his group remains opaque, and it is neither my desire nor inclination to assert direct causality where none can be established. Nevertheless, the co-option and control of similar developmental deals by Jang’s “clique” (if such a thing even existed), was one key rationale behind the assertion of his ‘criminal’ nature. Either way, the precipitous collapse of Jang set analytic tongues wagging in extremis, and quickly diminished interest in geologic exploitation.

As a result, the veracity of this enormous resource was never established, nor were the tools for such checks ever provided. SRE and Pacific Century’s online presence bears all the hallmarks of esoteric speculative exercise: the logic underlying some of the claims seems akin to asserting that because a similar geological formation to the north-west, within the territory of the PRC, holds reserves of some Rare Earths, such spaces in North Korea must do so as well. Thus, though this essay is no exercise in geologic debunking or revelation, I am suggesting that precisely this type of verification work is necessary, and intend to analyze the historical narrative and materiel available in order to at least underpin part of any future exercise of this nature.

While skepticism vis-a-vis SRE Minerals and the Yongju Deposit is wise, that is of course not to say that geological prospecting and fanaticism are by any means radical concepts for Pyongyang-based resource managers and mineral policymakers. Like most developmental sectors in North Korea, geological prospecting, and even the search for Rare Earths and other rare materials, has a far longer narrative tail than one might imagine.

KIM IL SUNG DOWN THE MINES

Giving Definite Priority to Geological Prospecting | Image: Willisms.com

Narratives of Geological Prospecting | “On Giving Definite Priority to Geological Prospecting,” a speech given by Kim Il-sung in mid May 1961, is a key exemplar. It is not, however, the foundational document in the sector. For one thing, 1958’s dissatisfying “Tasks of the Party Organisation in Ryanggang Province” is referred to in the text of the speech itself: “In particular, great successes have been made since the discussion of the measures to improve prospecting in 1958….”[1] It is also placed in the lee of a great North Korean extension of geodesic mapping and surveying, by which “solid foundations” have been laid “… for the development of more mineral resources during the Seven-Year Plan and for an all-out geological survey in the coming years….”[2]

While centralized, long term planning may not be as overt in the era of SRE Minerals and the Yongju Deposit, it would be strange if Pyongyang’s institutions did not consider the same type of developmental focus a key part of the economic stratagem of the Byungjin era. In 1961, central planning was very much the key vehicle in North Korea, and Kim Il-sung placed geological prospecting well within the framework of the first Seven-Year Plan. Apparently, geologic prospecting had hitherto been achieved through intense focus on the immediate and short term, but a position within the Plan was deemed vital for the development of a more holistic production and research agenda: “Just as the State Planning Commission plans for the immediate period ahead and for the long-term period separately, so the geological prospecting sector must do both its immediate and long term surveys zealously.”[3]

Joint Ventures and the General Bureau |It is intriguing to note the peculiar organization of SRE’s ambitions for extraction and prospecting in the Yongju Deposit so far as institutional and narrative structures are concerned . Pacific Century Limited represents the externally recognizable manifestation of capitalist expectation, the “Joint Venture,” or JV; however, twinned with SRE is a North Korean agency called Korean Natural Resource Trading Corporation. No doubt this corporation is an extension of a yet still more labyrinthine institutional structure in the Pyongyang governance ecosystem; organization themes that were equally apparent in 1961. It was vital in Kim Il-sung’s conception for geological prospecting to be institutionally embedded and have the necessary connections with the Korean Workers Party. Thus, not only should “party guidance of the prospecting sector… be strengthened” but, in fact, “… the whole system of Party organizations in the prospecting sector should be reshaped to strengthen Party guidance for this sphere….”[4] This reshaping involved extending connections with youth organizations and provincial party structures, but also the development of “a political bureau” within the central institution of the sector, “The General Bureau of Geology.”

“The General Bureau of Geology,” which reported to the “Heavy Industry Commission,” had also to be well structured and institutionally partitioned so as allow for effective commissioning and execution of strategies and goals; it should be “broken down in squadrons and further into teams.” However, institutional organization and reorganization should not become the key and end goal of the sector: “… the organizational system must not be too complex. Excessive sub-division might complicate work rather than facilitate it….”[5]

From Nickel and Gold to Vanadium and Mercury | The output of this system and its institutional structure were of course to be vital, not only to the productive and developmental goals of the first Seven-Year Plan, but also, as is certainly the case for SRE and the Yongju Deposit, as far as the financial possibilities of the output of all three were concerned. Kim Il-sung in 1961 asserted for example, “You must strive to find out nickel ore. Nickel is valuable; it is indispensable for the development of the chemical and machine industries” Because of the resource’s apparent importance to North Korean industrial development, “We must not export nickel ore, no matter how we are hard pressed for foreign currency.” Instead, taking advantage of the outside world’s perceived decadence, proclivities and fragility, “We should mine a good quantity of gold and sell it rather than selling nickel. Gold is something that should be mined quickly and sold before the capitalist world completely breaks down….”[6]

PRE-REVOLUTIONARY-MINING-AT-SUAN

 

This expansive, in depth understanding of extractive and geologic possibility in the mining sector of the late 1950s and early 1960s contains no trace of the Lanthanides, Yttrium, Cerium, or any of the other Rare Earths that SRE, Pacific Century and the Korean Natural Resource Trading Corporation will be hunting for as their instruments and equipment arrays traverse and prod the Yonju Deposit. Perhaps it is too early in North Korea’s scientific development for an awareness of such elements (Dysprosium, for example, was not even isolated until the 1950s). However, is it not the expansiveness and scope of potential and possibility that is the most revealing, and similar to the present day? The focus, the resolution of extraction problems for elements such as Mercury (“Mercury is found in our country, but we still cannot extract it by ourselves because we have not got the know-how….”[9]) will surely be repeated in SRE’s experience. Perhaps the optimism of revolutionary possibility has faded in the meantime, but not by any means the desire for leveraging the resources that can be extracted.

With the desire for extractive success in place, no doubt it will be an interesting experience for the (one hopes) optimistic and well leveraged participants of SRE, and for any brave investors who may follow them. I do not mean to imply the impossibility of their goal, although a warning in the shape of the Orascom and Koryolink enterprise may remind them of the matter of “extracting” profit from the North Korean domain. Rather, Kim Il-sung’s early demand that North Korean geologic prospectors seek the rare and unexpected does perhaps point to possibility buried deep in the rocks of Yongju. However, I am biding my time and undertaking long-term research and analysis, the better to demonstrate both historical and future extractive potential within Pyongyang’s domain.


[1] Kim Il-sung, “On Giving Definite Priority to Geological Prospecting,” Works 15 (Pyongyang: Foreign Languages Publishing House, 1961), 92.

[2] Ibid.

[3] Ibid., 94.

[4] Ibid., 101.

[5] Ibid., 101.

[6] Ibid., 95.

[7] Kim Il-sung, “Tasks of the Party Organizations in Ryanggang Province,” Works 12 (Pyongyang: Foreign Languages Publishing House, 1958), 228.

[8] Kim Il-sung, “On Giving Definite Priority to Geological Prospecting,” Works 15 (Pyongyang: Foreign Languages Publishing House, 1961), 96.

[9] Kim Il-sung, “On Further Developing the Mining Industry,” Works 16 (Pyongyang: Foreign Languages Publishing House, 1962), 320.

______________________________________________________

This post was originally published at sinonk.com – The author wishes to acknowledge the editorial support from colleagues at Sino-NK such as Dr Adam Cathcart, Christopher Green, Steven Denney and Darcie Draudt. Any edits or additions to the piece from its original authored draft are acknowledged. The author asserts his right to republish his own work here, but also acknowledges the element of co-production implicit from pieces originally published on sinonk.com

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