ASSESSMENT OF THE COAL RESOURCES OF THE KYRGYZ REPUBLIC:

COAL CHARACTER AND DISTRIBUTION, GEOLOGY, MINING, AND IMPORTANCE TO THE NATION'S FUTURE

USGS Open File Report 97-137A (English)

V. ISSUES AND SUGGESTIONS

The coal resource situation in Kyrgyzstan is affected by the interrelated factors: geologic, extraction, utilization, transportation, economic and institutional/political. The assessment addressed facets of the first four; economics and institutional/political factors are not in the scope of the assessment study except as observations. Environmental factors are commented upon as appropriate.

That the interrelated factors are not merging to satisfy the social and economic needs of the Republic are shown by the demonstrated inability of the existing indigenous coal mining industry to satisfy the anticipated need for coal in the short-term (through 1995) and probably for the long-term (through 2010) also. Efforts to restructure the existing coal industry to retain its viability were obvious by May, 1996.

It was anticipated in 1992 that the energy budget of the Republic in 1994 would require 3.6 million tonnes of domestically-produced coal. Actual production in 1995 was only 455 thousand tonnes.

Long-term energy plans derived in 1992 anticipate that the Republic will need 7.0 million tonnes of domestically-produced coal in 2010.

A. GEOLOGIC FACTORS

Coal is known to be present in more than 60 different named deposits in Kyrgyzstan and the generally-accepted estimate of 31,000 million tonnes of original geologic coal resources in the country may be conservative. The estimate has not changed recently because exploration peaked several decades ago and is almost non-existent now.

1. Issue 1.-Exploration and development

There have been only limited exploration and development efforts in Kyrgyzstan during the past decade or two. Past exploration and development activities have apparently been concentrated in the areas selected decades ago because of location, perceived resource potential, ease of minability, and their place in the long-range energy plans of the former Soviet Union. As a consequence, a large part of the coal resources classed as potentially recoverable are also concentrated in past and present mining areas. The portion of the presently estimated potentially recoverable reserves that has been mined, lost-in-mining or is otherwise unrecoverable, is unknown to the assessment team.

In many of these mining areas the reserves within the technical and economic boundaries of the original mine layout have been depleted without investing in the exploration needed for development of new mines or extensions of the existing mines. In other known coal areas of the country, mining has never been considered, presumably because of remoteness from major utilization sites in the former Soviet Union, difficult or non-existent transportation facilities, and a presumed lack of major resources in easily-minable settings. As previously-remote regions of the nation develop economically and socially, an increase in available energy will be required. An increased understanding of the resources and the potentially recoverable reserves of most of the known coal areas of the nation is required before policy decisions about future energy budgets and plans for capital expenditures for new mines or extensions can be made and justified.

Very limited exploration activities were underway in May, 1996. In the Abshir coal area of the South Fergana region one drill rig was testing expansion of the mining area at the request of the Kyzyl-Kiya mining company. Another drill rig was searching for coal in several areas in the Alay coal region at the behest of residents of the region. In the Uzgen Basin of the East Fergana coal region trenching and other surface exploration activities was being done at the request of small private mine operators. The exploration is being done by the Southern Expedition of the Ministry of Geology and Mineral Resources.

Suggestions are: 1) Increase exploration and development of the nation's coal resources with initial emphasis on present mining areas with recognized resource(reserve) potential, and on areas inadequately explored previously; and 2) Initiate exploration and development activities in parts of the country where coal is known to be present but has never been mined.

2. Issue 2.-Economically recoverable reserves

The coal resources of Kyrgyzstan have traditionally been classified according to reliability (based on the amount and distribution of data) and various technical and engineering factors (such as thickness, depth, rank and others) in a system similar to others used worldwide. It has now been recognized that availability and recoverability evaluations are also required for informed planning of recovery and utilization. Studies of this type meld a great range of geologic, engineering, and technologic factors with economic factors such as mining costs, market demand and product values, to provide the basic information and resulting options needed for planning the extraction and support facilities required for elements of a mining industry, and for overall policy planning.

Suggestion: Evaluate the amount of coal available and economically recoverable in the mining areas of the country. The studies would provide basic data about the coal resources that are recoverable at a cost that the economy of Kyrgyzstan can accept. Studies of this type are required before investment of time, energy and capital in elements of a mining industry can be further justified.

3. Issue 3.-Available information

During the course of past exploration, development, mining, and utilization, large amounts of information were gathered and generated regarding the coal resources of Kyrgyzstan. The information exists in a range of forms and is stored in a variety of settings. Unpublished information in files, such as laboratory analytical reports in laboratories; reports prepared for obscure meetings, published reports in agency or local series, unpublished reports of completed research, and other forms of potentially important data are presently still available in appropriate places. However, reorganizations, retirements, emigration and other causes for loss of institutional memory endanger these types of information that could be of significant future value.

Suggestion: Gather and organize the presently available information that can affect the future coal industry of Kyrgyzstan. As a minimum, the location of such information should be recorded to provide starting points for future recovery attempts. Ideally, the information should be gathered and organized so it could be integrated and interpreted as needs arise. Much duplication might be avoided with considerable future savings in time and money.

B. EXTRACTION FACTORS

1. Issue 4.-Depleted or otherwise inviable mines

Some of the present mining areas of the country have been in operation for long periods, one for at least 100 years. Some of the mines that were developed as large-scale, mechanized, long-wall underground operations several decades ago have depleted their reserves and worn out their machinery, and apparently have no identified adjoining or adjacent potentially recoverable reserves. Some of the older surface mines have reached the limit of safe and technically-feasible mining because of high overburden ratios. Examples of such mines are the Severnay underground mine at Tash-Kumyr in the Northern Fergana Region and the Abshir and Almalyk surface mines in the South Fergana Region.

Suggestions are 1) Encourage mines such as these to produce as much coal as possible for as long as possible with a minimum of capital investment until safety and efficiency require closure; 2) Consider changes in mining methods where this is may be a viable option, for example, from surface to underground as at Almalyk, or developing a surface mine adjacent to an underground mine as at Severnay and Kara-Soo mines in Tash-Kumyr.

2. Issue 5.-Mines suitable for rapid increase in production

Some of the mining areas of the country have mines in operation, development and planning that reportedly have access to large quantities of potentially recoverable reserves. Committal of funds and other resources is required before coal production can begin or increase. The quantity and quality of the available and economically recoverable reserves should be established along with the economic and engineering parameters for successful operations. Examples of such mines and areas are; the Tegenek underground mine presently under development at Tash-Kumyr, and the underground extension of the existing surface mine at Almalyk. Reportedly, the surface operations at Kara-Keche in the Kavak Coal Region could increase production with more, better or different equipment. In addition, underground mining in several areas of the Kavak Region might be feasible if increased production is desired in the future.

Suggestions are 1) Initiate availability and recoverability studies of the mines and mining areas that could contribute to an increase in the country's coal production in a relatively short time-frame; 2) establish the engineering and economic parameters for successful operation of such elements of the future coal mining industry; 3) if production for the benefit of Kyrgyzstan is desirable and feasible, provide the capital investment that will be needed.

3. Issue 6.-Private (formerly Small) Enterprises Mining Program

The modern coal mining industry of Kyrgyzstan was created with the intent of producing large quantities of coal efficiently and safely from large, highly mechanized, underground mines operating with longwall mining methods in areas with access to the transportation network of the former Soviet Union or in areas with nearby utilization sites. The mining areas operated as responsible social entities as well as productive enterprises. All exploration, development, mining, transportation, distribution and marketing were performed at the direction of government agencies. With independence, the loss of traditional markets, and the desire for creation of a nationally-responsive market economy with the energy budget to make it possible, structural changes in the coal industry are occurring.

One of the changes was initiation a few years ago of the Small Enterprises Mining Program, which was designed to satisfy local demand for coal by encouraging mining by local individuals or groups by surface -mining methods at outcrop areas. The mines were restricted to 10,000 or less tonnes of production per year and were required to provide free coal to "Budget Institutes" (schools, hospitals, etc.) who could not pay for the coal. (However, this "free" coal was credited against the taxes they would have to pay on their production.)

In 1995 the Small Enterprises Mining Program was reconstituted as the Private Enterprise Mining Program, restrictions on production and other requirements (such as "free" coal) were removed, and private investment is encouraged. The Small Enterprises received some direction and assistance from KYRGYZKOMUR but the Private Enterprises apparently do not. The Ministry of Geology and Mineral Resources is responsible for resource and reserve information prior to mining, for licensing the private mines, assisting operators with required documentation, providing technical expertise, and monitoring the conduct of mining activities.

At present all of the fifteen licensed private mines (and the dozen or more very small unlicensed mines) are surface operations essentially restricted to outcrop areas and production of coal with available earth-moving equipment. Increased production from the private mines will require more specialized equipment and technical knowledge. One of the possible changes is initiation of small-scale underground mining by conventional or continuous mining methods. Usual advantages of the continuous and conventional mining systems are much less capital expense and production of coal of coarser character. In addition, because they are usually more labor intensive than longwall, continuous and conventional mining might supply employment to considerable numbers of displaced miners. Generally, productivity is not as high; for example, longwall productivity in the USA in 1993 was 3.30 short tonnes per worker-hour, with continuous mining it was 2.84, and with conventional mining it was 2.56. Also, recovery is not as great--in the USA in 1993 it was estimated that 56 percent of the coal in longwall mines will ultimately be recovered, compared with 53 percent of the coal in continuous or conventional mines (Energy Information Admin., 1995).

Suggestion: Increase production to satisfy demand for coal energy, local and otherwise, by assisting the Private (formerly Small) Enterprises Mining Program. The private enterprises mines need training, assistance and support in all aspects of coal exploration, development, mining and marketing so they can be viable members of the developing free-enterprise system in Kyrgyzstan. In addition to up-grading surface mining capabilities, small-scale underground mining with conventional or continuous mining methods should be encouraged. Assistance, direction and overview from the Ministry of Geology and Mineral Resources (and perhaps from KYRGYZKOMUR) within the available experience, responsibilities, and specialities is required. Training and assistance is needed particularly to produce optimum quantities of coarse coal product. The technologic training must be coupled with training and assistance in free-enterprise mining economics, and in the conduct of small market-economy business operations.

C. UTILIZATION FACTORS

1. ISSUE 7.-Briquetting

The coals of Kyrgyzstan are inherently friable. The percentage of the coal produced by the operating mines that is classed as fines varies from about 35 to 70 percent. The longwall underground mines produce the largest percentage of fines and the surface mines produce the smallest percentage. Introduction of other mining methods such as continuous or conventional underground methods might reduce the percentage of fines in the coal produced. However, the friable nature of the coals dictates that, regardless of mining methods employed, the coals produced will include a variable but large portion of fine-sized material. The fine coal is usable in installations burning powdered coal but is poorly suited for use in furnaces with grates that are fed by stokers, or in domestic stoves. At present, the coarse coal portion of the mine production seems to have a ready market but the fine coal does not and must be stockpiled or discarded. Some studies of the possibilities of briquetting the coals of Kyrgyzstan have been conducted. Briquetting programs developed elsewhere to produce briquettes that might be usable in Kyrgyzstan await comparative examination.

Suggestion: Research and test the feasibility of briquetting as a solution to the problem of coal fines. Cooperative consultancy with experts from other countries might accelerate selection of appropriate processes for testing at laboratory and pilot scale.

2. ISSUE 8.-Domestic (non-imported) coal for northern Kyrgyzstan

The heavily populated northern part of Kyrgyzstan in the Chu Valley region depends largely on coal imported from Kazakstan. The quality of the imported coal is mostly poorly- suited for the installations that use it. Reportedly, the mine at Dzhergalan east of Issyk Kul in the northeastern part of Kyrgyzstan could increase production to supply coal for transport by truck or barge to the railroad at Balykchy at the western end of Issyk Kul for transport westward. If this possibility is feasible, the amount of imported coal might be reduced and better quality coal supplied to users in the area. Better quality coal might be blended with imported coal to produce boiler feed of greater efficiency.

Suggestion: Investigate the possibility of increasing coal production at the Dzhergalan mine in the Issyk Kul coal region to supply coal to the Chu Valley Region. The dependency of northern Kyrgyzstan on imported coal might be at least partially alleviated by supplying better-quality domestic coal to the district heating and electricity-generating plants at Bishkek and Kara Balta.

D. TRANSPORTATION FACTORS

1. Issue 9.-Inadequate infrastructure

The pre-independence transportation infrastructure of Kyrgyzstan was never intended to support the internal activities of an independent nation. As a consequence, the Kyrgyz Republic is poorly served by its present roads and railroads. The mountainous character of the country presents serious but not unsurmountable obstacles to building of roads. Maintenance of the existing, heavily-used roads, which total about 30,000 km, is poor, perhaps because of a shortage of operable equipment. [The assessment team saw one operable road grader during their journeys.] Only the northern part of Kyrgyzstan has a railroad system. The areas peripheral to the Fergana Valley in the southwestern part of the country have access to the railroads that serve Uzbekistan, Tadjikistan and Kazakstan. The central, eastern and southern parts of the country have no railroads. A large part of the 370 km of railroads in the nation are in the northern part. For comparison, the farming-ranching State of South Dakota in the USA is about the size of Kyrgyzstan but with far less population, and has 3,100 km of railroads and about 134,000 km of paved and unpaved roads.

Coal mined in the coal regions in southwestern Kyrgyzstan formerly could travel about 1,000 km through Uzbekistan and Kazakstan to reach utilization sites in northern Kyrgyzstan, but presently is restricted to nearby markets. The coal mined in the Kavak coal region in central Kyrgyzstan must be hauled by truck to market areas in southern and northern parts of the country. The coal mined in the northeastern part of the country moves by truck only 65 km to the utilization site.

Suggestions are: 1) Increase routine maintenance of existing roads to improve efficiency and decrease costs of truck transport of bulk commodities such as coal. 2) Develop an expanded railroad transportation system to help solve the problem of transporting domestically-produced coal for use internally, and perhaps for export. The proposed railroad connecting southwestern and northern Kyrgyzstan would allow coal from the southwestern part of the nation to be used in the northern part of the country. In addition, the railroad would traverse the coal-rich Kavak coal region allowing cheaper transportation of the Kavak coals to northern markets.

E. COMBINED FACTORS

1. Issue 10-Periodic Review

The expected improvement in the economy of the Republic will create an increased demand for energy. Demand for coal will increase in correlation with increase in Gross Domestic and National Products. A periodic, preferably annual, review of all aspects of the coal industry of Kyrgyzstan would provide an update and continuing analysis of the progress of exploration, development, mining, marketing and utilization. An annual review by an expert group of country-knowledgeable specialists would be a source of unbiased reliable information for policy-makers, planners and investors. Timely technical and economic information is necessary to support the coal industry in its transition from a part of a centrally-planned monolith to an important and necessary part of a sound market-oriented economy.

Suggestion: Plan an annual review by country-knowledgeable western specialists with appropriate Kyrgyz counterparts and cooperators. The catalytic combination of basic and time-dependent information with the varieties of experience, knowledge and viewpoints represented by the review team and their coworkers would supply the integrated and summarized data needed by a very broad range of governmental and private agencies and organizations. A periodic up-date would be the most cost-effective way to maintain understanding of the swiftly-changing coal energy situation in the Kyrgyz Republic.

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