The Shanxi Coal Mine Blast and the Failure of Safety Governance in China

A methane blast at the Tunlan coal mine in Shanxi on February 22 killed 78 miners and the last body was not recovered until five days later (Nanfang Daily, February 27). China’s numerous collieries, most of them being township and village enterprises (TVEs), have long been the world’s most deadly. Since the inception of the People’s Republic of China (PRC) in 1949, official sources have put China’s cumulative coal mining fatalities at more than 250,000, and independent estimates are much higher (see Figure 1 in PDF). While the official coal mining death tolls in 2008 were 3,210, a 54 percent drop compared to 6,995 in 2002, China’s 2008 fatality rate of 1.182 deaths per million tons (Mt) of coal mined means that the world’s largest coal producer’s safety standard still lags far behind the second largest one, the United States, by at least 55 years [1]. Due to recent economic slowdown, China has been experiencing a potential coal surplus for the first time since the late 1990s, which should offer a long-awaited window of opportunity to address its safety challenge. Yet, the deadly Tunlan accident has revealed that the fundamental illness of China’s safety governance mechanisms remains unscratched by scrutiny.

The Tunlan Coal Mine Blast

Unlike most of China’s coal mining accidents, the blast at Tunlan has nothing to do with TVE mines, which currently account for about one third of China’s coal output, but 77 percent of its coal mining fatalities [3]. Instead, the 5 Mt Tunlan Mine boasts one of the best mining facilities in China. Its parent company, Shanxi Coking Coal Group (SCCG), is China’s largest and the world’s second biggest coking coal producer. Tunlan is not only the first mine at SCCG to utilize fully mechanized mining equipment, but also the first colliery in the world to utilize the “Large Cross Section Supporting Technology,” which is Tunlan’s proprietary invention and won the first class prize of the National Technical Advancement Award. Being a gaseous mine with fugitive methane emissions rate at about 20 cubic meters per ton of coal mined, Tunlan has installed highly efficient ventilation system, and utilized coal bed methane to fuel its boilers. Many of Tunlan’s dedicated underground inspectors are equipped with state-of-the-art methane detectors, which further eliminate the possibility of explosion. Since 2004, Tunlan has prided itself for zero mining fatality (First Financial Daily, February 23; Caijing Network, February 25). Not only were Chinese officials surprised by the bloody explosion at one of the country’s best collieries, many survivors were caught tragically unprepared.

Another unique quality of the Tunlan blast rests on how the accident was covered by the Chinese media, which has long been regarded as the propaganda machine of the state and ruling party. While the reporting of major catastrophes is a sensitive topic under heavy government control, the Chinese media nevertheless has become increasingly critical toward coal mining accidents. The authorities classified the country’s most deadly coal mine accident at Laobaidong in Shanxi in 1960, which killed 682 miners, as a ‘state secret,’ it was eventually disclosed by China Coal Post in 1998 [4]. On July 17, 2001, when 81 coal miners died in an inundation accident in Nandang County, courageous reporters working for Yangcheng Evening News and other media risked their lives to dig out the story for the outside world [5]. Yet, in recent years, Chinese media has become less critical on sensitive topics, which is especially evident in the news coverage of Tunlan blast.

Drivers Underlying the Catastrophe

Though the February 22 blast happened at a state-owned mine, the most important contributing factor is the authorities’ inability to develop an effective strategy to manage China’s TVE mines. After China was opened to the outside world in 1979, state-owned mines were unable to meet the burgeoning demand due to heavy welfare obligations to their bloated workforces and retirees. Beijing was forced to allow private investment into the coal industry. In 1991, the number of TVE mines reached to an astonishing 100 thousand, and the share of coal production by TVE mines grew from 17 percent in 1979 to 46 percent in 1997 [6], which soon led to problems such as tax evasion, environmental degradation and mounting accidents. In the late 1990s, lured by a temporary coal surplus, Beijing launched a national campaign to close TVE mines.  Since then, China’s coal industry features the love-and-hate relationship between the state and private enterprises: 1) with governmental favoritism, state-owned mines expanded rapidly; 2) Beijing orders targets for TVE mines’ closure; 3) fearing loss of tax revenues and often personal gains, local officials quietly resist Beijing’s orders, and many TVE mines that were supposed to be closed still secretly operate; 4) the burgeoning economy needs much more coal than state enterprises can meet, Beijing realizes the private sector has been overdosed, with no choice left but to loosen permit requirements; and 5) TVE mines flourish in the market again.

Though TVE mines are the de facto swing producer in the Chinese coal market, with a critical role to meet any shortfall between domestic demand and what state-owned mines can produce, their contribution to the Chinese economy has been intentionally downplayed in the past. Instead, TVE mines are the easiest targets whenever pointing fingers become a necessity. Because the number of TVE mines is being reduced to 10,000 by 2010, the private coal mining industry as a whole has no incentive to make long-term investment to improve mines safety. Overproduction (typically 150 to 300 percent of design capacity) and death toll falsification whenever possible are the norms. While TVE mines are the weakest link of China’s coal industry, many state-owned mines are expanding at breakneck paces and often produce much more than they should without adequate safety margins.

To solve its safety challenge, Guangdong, one of the most developed provinces and a major coal consumer in China, shut down all collieries within its geographic boundary in 2005. Though undeniably effective, such an administrative decision not only deeply hurts the interests of all stakeholders in Guangdong’s coal industry and wastes indigenous resources, but also put extra pressure on China’s over-loaded transportation infrastructure. In addition, the subsequent transferring of sizable death tolls from a wealthy coastal province to much poorer hinterland such as Shanxi is also morally questionable.

Similarly, in the wake of the Chinese Spring Festival, annual sessions of people’s congresses, and people’s political consultative conferences, TVE mines have been closed across the country just for the sake of political sensitivity. In January 2009, though China’s national coal output declined by 11 percent on a year-over-year basis, production by key state-owned mines actually grew by 12 percent on a similar basis [7]. As a result, many state-owned mines operated beyond their safety margins in early 2009. Though Tunlan’s annual capacity was retrofitted from 4.0 to 5.0 Mt in 2005, an anonymous source cited 4.0 Mt as Tunlan’s optimal output level, and 4.5 Mt as its safety threshold, beyond which equipment overcapacity and worker fatigue would make its operations prone to accidents. In 2008, Tunlan produced 4.62 Mt of coal, which already exceeded the alleged threshold (First Financial Daily, February 23), so whether the massive TVE mine closure in early 2009 has lured Tunlan to operate beyond its safety margin is a legitimate question that deserves attention during the accident investigation.

The heavy death tolls at Tunlan are also a direct result of the low productivity of China’s coal industry. Considered to be on of China’s best collieries, Tunlan is actually not exceptional in this regard and as many as 436 miners crowded its tunnels when the blast occurred. To counter individual accidents with heavy fatalities, Shanxi government in 2005 put limits on the number of miners allowed to work at an underground colliery in accordance with its design capacity. For a 0.09 Mt mine, the maximum allowable miners are 29. For a 0.9 Mt mine, the limit is set at 99 instead of 290 because the expected economy of scale [8]. Given Tunlan’s design capacity of 5 Mt, 436 underground miners at one shift do not even meet the expected minimum productivity standard implied by Shanxi government’s 2005 regulation. 

To make matters worse, both Tunlan’s investment on safety equipment and emergency training for its miners are insufficient. When the blast occurred, Tunlan’s methane alarm system did not send off a signal. While the accident at Tunlan was a localized methane explosion, the number of miners that were directly killed was not so high. If the evacuation was implemented under an ideal scenario (e.g. well trained miners with adequate protection), the final death tolls would have been far less than the actual level.  Unfortunately, many first round survivors still had no clue what happened even after they were ordered to evacuate, some did not wear their self-rescue equipment at first. For those who remembered such a procedure, several of them are reported to have fainted when they rushed through the mine shaft. As a result of such a messy evacuation, all 340 miners evacuated from the mine showed symptoms of carbon monoxide poisoning. Of 114 miners hospitalized, 11 died and 26 were found to be in critical conditions (China Daily, February 22; February 23; Chutian Golden Newspaper, February 23; February 24; Nanfang Daily, February 26).

To further complicate the matter, the lack of qualified employees is endemic to a disease that plagues China’s coal industry. Low income levels, highly undesirable work conditions and negative exposure in the Chinese media make it extremely difficult for Chinese collieries to attract and retain qualified employees, which creates a shortage of expertise required to raise mine safety standards. According to the Safety Training Centre of the SCCG, more than 80 percent of Tunlan’s trained safety inspectors, arguably the most important position for safety operations, only received middle school education, and none of them has a college or higher level degree [9]. As Tunlan is actually one of the best state-owned collieries in China, the picture of staff qualification is far bleaker for other coal mining enterprises, especially China’s numerous TVE mines.

Is There a Way Out?

Given the large size of operating collieries in China, Beijing’s efforts to reduce the number of operating mines is legitimate. Yet, instead of blindly closing coal mines whenever a major accident happens at the adjacent region or just for the sake of avoiding political sensitivity, the authorities should take each mine’s unique conditions into consideration even if a safety rectification campaign is necessary. Currently, Beijing plans to reduce the number of “small mines” (a politically correct terminology for TVE mines) to 10,000 by 2010. At the same time, shutting down a coal mine solely based on its capacity is not only unfair for small collieries that strive to meet safety standards, but also encourages more to operate illegally across the country, which will have a detrimental impact on the accounting methods used in calculating Chinese coal statistics.

TVE mines are widely regarded as the black sheep of China’s coal industry, and private colliery owners are often portrayed by the media as rude, self-aggrandizing, and tax-evading upstarts. Yet, since 1978, TVE mines have provided more than 35 percent of China’s cumulative coal output to fuel China’s burgeoning economy [10], and have become an indispensable part of China’s energy sector. They were always Beijing’s last resort whenever a coal supply shortage occurred due to the flexibility of their operations. As a result of the extremely complex geological structure of China’s coal resources, a large portion of Chinese coal deposits are only suitable for small scale underground mining operations. Without a reasonable presence of private enterprises, the level of competition required for long term healthy development of China’s coal mining industry cannot be ensured. Further, TVE mines are important taxpayers in many coal producing regions, they employ large number of migrant workers, and are important to China’s social stability. Not only the governmental favoritism towards state-owned mines needs to be reconsidered, the indispensable role of TVE mines to the Chinese economy should also be formally recognized.

The most formidable measurement imposed by Beijing regarding safety management so far may be the so-called “The Safety Framework Governing Resignation of Responsible Officials.” Meng Xuelong, the former governor of Shanxi, was the first provincial cadre in China to resign under such a safety framework after a major mining-related accident in September 2008. Following Meng’s resignation, Beijing appointed Wang Jun, the former director of the State Administration of Work Safety, as the acting governor of Shanxi (Nanfang Daily, September 14, 2008). While Wang Jun’s political ascendancy in Shanxi has shown Beijing’s determination to reign in China’s chaotic coal industry, the Tunlan blast nevertheless demonstrates that the “top-down” punitive measurements used toward government officials alone are insufficient to solve China’s mounting safety challenges.

As the Chinese economy becomes increasingly market-oriented, Beijing should adopt an alternative approach that can be described as “enforceable sticks with sufficient carrots.”  While punitive measurements for safety violation are an indispensable component to solve China’s safety challenges, enforceability should be a prerequisite for introducing such enactment. For instance, introducing overly ambitious targets (e.g. TVE mine closure) is a very counterproductive practice that should be avoided in the future. More importantly, a legal and taxation environment featuring transparency and stability should be nurtured to create a fair playground for all coal enterprises, especially TVE mines. Only if such type of carrots is made available, sufficient resources of China’s private coal mining industry could be directed towards safety investment and long term growth instead of beating around the rules and colluding with local officials.

Notes

1. According to the Mine Safety and Health Administration, U.S. Department of Labor, coal mining fatality rates in the U.S. were 1.191 and 1.041 in 1952 and 1953, respectively.
2. Tu, J. (2008). Coal Mining Safety: China’s Achilles’ Heel. China Security. Vol. 3(2). P.36-53. / The State Administration of Work Safety’s (SAWS) website. / China Coal Industry Yearbook, various years. / Guo, G. and et al. (2006). Coal Mine Safety Technology and Management. Metallurgical Industry Press: Beijing.  
3. Production share is based on 2008 data from the China Coal Transportation and Marketing Association, fatality share is based on 2007 data from the SAWS.
4. He, Y. (1998). “Wen Cangmang Dadi (Report of China’s Most Deadly Coal Mining Accident),” China Coal Post.
5. Zhao, S. (2004). Nandan Mining Accident: Case Study of the Struggling News Coverage, in Investigating China: Stories behind the Headlines. Chinese Fangzheng Publishing House: Beijing.
6. China Coal Industry Yearbook, various years.
7. Source: China Coal Transport and Distribution Association (CCTD).
8. Inter-ministry Office on Coal Mine Methane Accident Prevention (2006).  “Shanxi Limits Number of Coal Miners Working Underground.” Coal Mine Methane Prevention. Issue 32.
9. Website of the Safety Training Centre of the SCCG, at https://www.xsmdap.com/ns.php?catid=3286&nowmenuid=4737&cpath=3285:3286:
10. China Coal Industry Yearbook, various years / CCTD.