mineral resources

Mr. Li is the owner of a manganese mine in Guizhou. He recently signed a large order and needs working capital to purchase equipment. He remembered that he had a mining right certificate in his hand, with an estimated value of at least 50 million. I went to the bank and asked, and the bank said that I could mortgage it, but I had to go through "mortgage registration" first.

Step 1: Confirm the mortgagor and mortgagee

Mineral rights mortgage is a transaction between the "mining rights holder" and the "financial institution". It should be noted that the mining rights must be within the validity period, undisputed, and unsealed.

If the mineral rights have the following conditions, mortgage registration cannot be processed:

• Mining licenses have been revoked or expired without renewal
• There are ownership disputes over mineral rights
• Mineral rights have been seized by the court or restricted from transfer by administrative departments
• Unpaid income from mineral rights transfer

Step 2: Sign the main creditor’s rights contract and mortgage contract

Before lending, the bank will verify the authenticity and value of the mineral rights, conduct due diligence on the mine, and negotiate and determine core terms such as mortgage amount, interest rate, and term.

Step 3: Prepare application materials

According to the "Temporary Service Guidelines for Registration of Mineral Rights Mortgage" issued by the Ministry of Natural Resources, the following materials need to be submitted:

• Application form for registration of mining rights mortgage
• Copy of business license (both parties need to provide)
• Original mining rights certificate
• master creditor's rights contract
• mortgage contract

Step 4: Submit application to registration authority

According to the level of mineral rights, the registration authorities are different: petroleum, natural gas, radioactive minerals, rare earths, etc. are handled by the Ministry of Natural Resources; general minerals are handled by the provincial natural resources authorities.

Step 5: Wait for review and receive registration certificate

The review will be completed within 20 working days after acceptance. If the conditions are met, the mortgage information will be recorded on the mining rights certificate and a "Mining Rights Mortgage Registration Certificate" will be issued.

Yingting lawyer reminds

Lawyer Liu JingzhuSpecial reminder: Mortgage registration only confirms the publicity effect of the mortgage right; if the debtor cannot repay when due, the bank has the right to apply for an auction of the mineral rights, but the auction must go through legal procedures.