China closed its largest financially struggling coal strip mine yesterday, a move regarded as a firm step towards snuffing out the country's dying state- owned mines.
The state-owned Haizhou Coal Mine in Fuxin, northeast China's Liaoning Province, was Asia's largest mine in the 1950s.
It has become the largest coal mine to announce bankruptcy since China began to close failing mines in 1999.
Experts said that the government has closed more and more large, struggling mines to show its determination to snuff out the "dying " part of China's strong economy.
"It is a historic moment and also a tragic moment," said Sun Hongmao, head of the Haizhou colliery after hearing the bankruptcy announcement made by a local court.
As one of the largest coal mines built after the People's Republic of China was founded in 1949, the Haizhou colliery had a glorious past. By 2003, Haizhou had contributed 210 million tons of coal and 3.38 billion yuan (US$407 million) in profits since it opened in 1953, said Sun.
But after years of over-exploitation, however, the mine currently has reserves of only 870,000 tons.
In fact, there are more than 400 coal mines in China that have experienced or will experience the same fate as Haizhou.
Finding a way out for the mine companies has become a challenge for the Chinese government.
Declaring bankruptcy is the most popular way to solve the problem, but compensating former employees is costly.
The government will pay an average of 20,000 yuan to each of Haizhou's 100,000 employees as a compensation. The mine is also responsible for finding a new job for all former workers. Total cost is estimated at around 860 million yuan.
The fuxin Coal Mining Group, Haizhou's boss, has signed a cooperation agreement with an opencast coal mine in north China's Inner Mongolia Autonomous Region, where Fuxin will be responsible for the exploitation of a coal field with the reserves of 2 billion tons.
"The first group of 2,000 Haizhou workers will go to work in the mine, " said Zhang Xiaojiang, an official the Fuxin group.
"Comparing to finding a new job that I have never done before, I would rather to do my own profession," said a miner of Haizhou, who just gave his surname as Du.
(Xinhua)