Chapter 11 Vested interests in coal resources

For Wenzhou Capital around 2009, it was nothing short of a disaster. The cause of the incident is all related to the "Measures for the Disposal of Resource Rights and Prices Involved in Mergers and Reorganizations of Coal Mine Enterprises" issued by the Shanxi Provincial Department of Land and Resources.According to the spirit of the "Measures", all small coal mines in Shanxi Province will be fully integrated by large state-owned coal enterprises.Shanxi coal enterprises that have undergone mergers and reorganizations can retain a maximum of 1,000 coal mines by the end of 2010, and in principle, the annual production scale should not be less than 3 million tons, and the production scale of a single well should not be less than 900,000 tons.

Leaving aside the latter data for the time being, the significance of the indicator of "retaining 1,000 coal mines" is extraordinary.At that time, there were 2,598 coal mines in Shanxi, which meant that more than 60% of the coal mines had to be "eliminated".A considerable part of this "more than 60% of coal mines" is the investment of Wenzhou people.Obviously, the promulgation of the "Measures" means that the investment of Wenzhou people in Shanxi ended in failure. In fact, long before the "Measures" were promulgated, the coal investment business of Wenzhou people had already been affected.

Take a Wenzhou boss who invested nearly 200 million yuan in Gaoshan Town, the southern suburb of Datong City, as an example.He had already come to Shanxi to invest in coal mines as early as 2002, and for ten years until 2010, it can be said that he did not have a solid day.Regardless of the risks such as landslide casualties that may be encountered when investing in coal mines, the changes in local policies alone make people restless. In 2005, when the investment in coal mines was hot, there were 170 small coal mines in the southern suburbs of Datong City. Soon after the government rectified, the number was reduced to 58. The investment of more than 100 others, just like Wenzhou Capital today, was in vain. .In order to ensure that his coal mine will not be "integrated", the Wenzhou boss spent huge sums of money to increase production capacity and invest in safety equipment, and successively paid 30 million yuan in various guarantee funds for the local government.But even so, by 2008, with the introduction of the policy of closing small coal mines in Datong City, his small coal mines were still ruthlessly forced to close.Similar to the situation of this investment boss, many Wenzhou coal bosses have encountered it.

The reason why Wenzhou capital has made such a big mistake is that, on the one hand, the coal investment policy is unstable, and on the other hand, the people of Wenzhou are ignorant of risks.Coal is a high-profit, high-risk investment, and the failure of this investment can be said to be an accidental necessity. Even so, the investment thinking of Wenzhou people in the coal business is still thought-provoking.We people today only see the failure of Wenzhou people, but we don't see the golden age when Wenzhou people invested in coal in the past. As early as the 1980s, when the country opened up coal resources and allowed private capital to enter coal mining, Wenzhou people who were good at grabbing the market heard the news and immediately flocked to Shanxi, the coal base of the country, and started their career as coal bosses.

However, the initial coal business of Wenzhou people was not smooth.At that time, the price of coal was very low, and the price was still falling. The lowest point was only 10 yuan per ton.The Wenzhou people who initially contracted the mine had to pay double the investment cost in the worst case.Helpless, had to transfer the mine.However, most of the first people who moved into the coal mines in Shanxi were workers from well and lane engineering companies in Cangnan County and Pingyang County, Wenzhou. Their excavation teams were more skilled than those in Shanxi. contracted. The Wenzhou Coal Boss, who survived the most difficult period, ushered in a golden period in his career after 2000.Especially during the period from 2002 to 2004, with the industry's increasing demand for energy, with the development of industry and the establishment of coal power enterprises, the price of coal, which is in short supply, has also soared. It has risen to nearly 400 yuan, and many coal bosses, to exaggerate, spend their time counting the money.

Seeing that investing in coal can get rich returns, the Wenzhou boss, who is good at helping relatives and friends, immediately returned to his hometown to gather more people. Everyone raised more funds and contracted more mines.For a time, Wenzhou capital was "overwhelming" in Shanxi, and the coal mining industry in Shanxi has become the base camp of Wenzhou capital.At its most glorious time, Wenzhou Capital even controlled 60% of small coal mines in Shanxi, with an annual output of 80 million tons of coal mined.This data is 1/5 of the total coal output of Shanxi Province and 1/20 of the whole country!

The coal industry is so hot that Shanxi Province has introduced various policies to guide private capital into small coal enterprises.More capital from Wenzhou has also flowed in following these policies.In the two years from 2005 to 2006 alone, a county in Shanxi Province received 30 billion yuan of Wenzhou capital, and the investment capital of Wenzhou in Shanxi Province at that time was no less than 50 billion yuan.One of the big bosses, Huang Yichou from Wenzhou, owns three small coal mines with an annual output of 150,000 tons, with an investment of nearly 500 million yuan! There are many Wenzhou coal bosses like Huang Yichao in Shanxi Province.A Wenzhou boss surnamed He originally ran a clothing business in Wenzhou. In the second half of 2003, fellow villagers told him that it would be more profitable to invest in coal in Shanxi.So he gave up the clothing business he had been in for more than ten years, invested 20 million yuan, and bought a small coal mine with his friends.The income was really fast. By 2005, he had recovered the investment cost, and the rest was waiting to make money.He said: "The folks in Wenzhou who invest in coal are almost crazy about making money. Everyone says this is a rare and happy investment project."

Regarding the high profits of coal investment, some Wenzhou coal bosses made no secrets: "To tell you the truth, the coal mine I contracted was about to run dry at the time. I didn't invest much money at all, and I made all the money back in less than two years-you Why do I invest in a coal mine that is about to be exhausted? As long as I can still mine for a year or two, I won’t pay, because you don’t understand the profits here. The price of coal in Shanxi is more than 300 yuan per ton, and the price per ton of coal is The mining cost is basically around 30 yuan, and I can make a net profit of two or three hundred. Even if my small coal mine only produces 300 tons of coal a day, I still have a profit of more than 60,000 yuan a day."

At the most glorious moment of coal mine investment, the Wenzhou coal boss was busy counting money all day long. It is not an exaggeration at all.In many cases, the customer's money has already been transferred to the account before the coal is mined.Such a good business, who can withstand the temptation? With such a high profit from coal investment, more and more Wenzhou people come here admiringly.As of 2006, there were no less than 2,000 Wenzhou coal bosses, large and small, and there were traces of Wenzhou coal bosses in any coal-producing area in Shanxi.The Shanxi market has almost become the world of Wenzhou merchants. A high-end car drove past on the road. The owner of the car was almost certainly the owner of Wenzhou Coal.

However, where there are huge profits, there are often huge risks.For coal bosses, nothing is more affected than a mining accident. In 2003, the death toll in China's coal mine accidents accounted for about 80% of the death toll in mining accidents.With the prosperity of Shanxi's coal industry, this figure is gradually rising.So from 2008, Shanxi began to rectify small coal mines, and for those small coal mines with insufficient safety facilities, they were forced to close down. This is actually a signal that coal bosses in Wenzhou will no longer be able to make money as recklessly as they did in 2006.Even so, many Wenzhou capitals have not thought about withdrawing their capital. After all, the profits here are too great. After all, coal, like food, has become an indispensable energy source for the country's industrial development.Besides, when they first contracted the mine, they all signed contracts with the Shanxi government for several years or even ten years, and it was impossible to let them go so easily.

Therefore, regarding the rectification of coal mines by the Shanxi government, they only increased investment to make their coal mines safer and have more room for development.Even so, Shanxi Province is still promulgating various policies to rectify coal mines, and local governments issue documents every year, requiring coal mines to improve safety levels and increase coal mine production capacity.Every time a document is issued, these small coal mines will stop production for a period of time and reinvest in the mines according to the requirements of the local government.In addition, every time a mining disaster occurs, all coal mines must be shut down for inspection. The days of production shutdown, that is, the days of high investment and no return, the deadline for resumption of work is far from known.Wenzhou merchants are already facing great investment risks, and they are still holding on patiently. As long as they can continue to produce, they will immediately reinvest in coal mine production with great enthusiasm. But 2009 inevitably came. With the release of the "Measures for the Disposal of Resource Rights and Prices Involved in the Merger and Reorganization of Coal Mining Enterprises", Wenzhou businessmen had to shed tears in Shanxi and waved goodbye to the fertile money kingdom of coal.Some coal bosses in Wenzhou were unwilling to leave like this, and insisted until the last moment, negotiating and negotiating with the local government, until the local government in Shanxi issued an "ultimatum", and they left this sad place with meager compensation for losses. Leaving the little coal mine where they put a lot of heart and soul into it. People only marvel at the richness of Wenzhou people and the strong capital of Wenzhou, but few people in Wenzhou are as willing to do business under huge risks as Wenzhou people.For Wenzhou people, "safety is worth a thousand dollars, and risking half a lifetime is worth ten thousand dollars."In the face of a strong desire to make money, all risks are worth it.Although the saying goes, "No pain, no gain", but people are unwilling to listen to the second half of it: "No risk, no success." It is the courage to take risks to do business that makes Wenzhou Capital what it is today It is only through the growth of the company that it has the momentum it has today. Although the failure of coal investment in Shanxi this time made many Wenzhou businessmen feel like crying, it does not mean that they are too timid to do business since then.As long as it is profitable, as long as it sees high profits, I believe that Wenzhou people who regard making money as their "faith" will still rush forward without hesitation, vying for the biggest piece of cake.