Chinese barite faces a growing market

By IM Staff
Published: Thursday, 15 December 2016

Chinese barite production and exports enjoyed a heady few years when the US oil boom was at its peak three years ago, but the decline in drilling activity since 2014 has seen a slowdown in demand for the oilfield mineral. However, in November 2016 there are signs of a recovery with US rig counts higher and a likelihood of oil prices increasing to $50-55/bbl. This will lead to increased consumption of barite in 2017, Ian Wilson, Consultant, finds.

By Ian Wilson, Consultant*

China is the largest producer of barite (barytes) in the world and the second biggest consumer after the US. The country accounted for approximately 40% of global production in 2015, which the US Geological Survey (USGS) estimates stood at 3m tonnes. Chinese domestic barite consumption is around 1.5m tonnes per annum (tpa), with 50% going into oil and gas production, 40% into the chemical industry and 10% being used for construction, counterweights and other uses. The location of barite production and reserves in China are shown in Figure 1 with production from 2011-2015 in Table 1.

Reserves of barite in China probably total approximately 270m tonnes, although the USGS puts the figure at just 100m tonnes, with 92.3% of production concentrated in 5 provinces (Table 2) and 90.7% of reserves concentrated in seven provinces (Table 3). 

Chinese barite exports decreased significantly in 2015 compared to the previous year and shipments over the first eight months of 2016 have fallen even further. The decline has been led by lower exports to the US. Having taken almost 2m tonnes of Chinese barite in 2012, the US had cut its volumes to 960,000 tonnes by 2015 and in  January-August this year, has received just 380,000 tonnes.    

According to the Belgium-based Barytes Association, the largest barite suppliers in the world last year after China were Morocco, at 14% of global production, India at 12% and the US at 6%, with the remaining 28% coming in smaller fractions from other countries.

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Figure 1: Location of barite production and reserves in China. (Source: Ian Wilson )

Types of barite

There are two main types of barite. Stratiform type barites are concordant with the bedding of the host rock, which is generally limestone or shale. Often greyish to dark-grey in appearance and low in strontium, stratiform barite is suitable for some chemical grades and American Petroleum Institute (API)-grade drilling muds. 

An example of dark-grey stratiform barite from the Tianyan mine in Tianzhu, Guizhou province, is shown in Figure 2.

The other kind of barite, vein types, cross-cut the host rock and are generally infillings within fractures and fault lines. These barites vary in colour from white to yellowish and are often iron-stained. Characterised by higher levels of strontium, reflecting their origin as infillings from solutions, these barites are suitable for API drilling muds, chemical grades and high brightness fillers. 

An example of white barite from Yanhe in Guizhou province is shown in Figure 3.

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China’s barite exports

China’s barite exports from 2012-2016 (January-August) are shown in Figure 4. Last year’s exports declined significantly from 2014 and the tonnage for the first eight months of this year is 33% behind the equivalent period in 2015.

The destinations of Chinese barite exports this year are shown in Table 4 and Figure 5. A comparison of Chinese exports from 2012 and 2016 (January-August) shows US share falling from 62% to 38% and Middle East increasing from 15% to 37% (Figure 6).

Pricing of Chinese drilling grade and white barite from 2012-2016 (January and October) is shown in Table 5.

Prices for Chinese drilling grade barite have softened over the past five years, from $131-135/tonne FOB China in 2012, to $85-90/tonne this year. This is largely due to the decline in US demand as a consequence of lower oil drilling activity, in response to weaker oil prices. The USGS reports that, between January and October 2015, the number of drill rigs operating in the US fell from 1,811 to 787. The decrease in drilling activity is estimated to have reduced domestic barite consumption by approximately 25-30%. 

Prior to 2015, India, Mexico and Morocco increased their barite production and trade with higher exports to the US. In 2015, these countries scaled back output, mainly in response to lower US consumption. 

Up until last year, Chinese white barite prices had been relatively stable, due to limited production. The 2015-2016 price drop is partly due to the depreciation of Chinese yuan against US dollar. 

Below are updates on how some Chinese barite companies are dealing with the shifts in markets and prices for their products.


Rocky Mountains Industry Development Co. Ltd 

Founded in June 2003, Rocky Mountains Industry Development Co. Ltd specialises in mining, processing and trading non-metallic minerals, with barite being its major business activity. The company’s head office is in Shenzhen, in Guangdong province, with operations in Guizhou, Guangxi and Hunan provinces. Details of Rocky Mountains operations are in Table 6.

Tiianzhu Chemical Mining Corp.

Tianzhu Chemical Mining Corp. was formed in 2013 as a joint venture (JV) between Hao Hua Chemical Group, with an 87% share, and Rocky Mountains with the remaining 13%.  The companies merged adjacent barite deposits in Tianzhu and the combined mine is now referred to as Tianyan.  

The JV’s mining licence covers 3.22km2 and holds 11.1m tonnes of barite resources within 25% (0.80 km2) of this area. The rest of the deposit area is earmarked for future evaluation. 

Tianzhu Chemical is aiming to produce 500,000 tpa barite from the Tianyan mine, split between chemical and drilling grades. The mine’s current capacity is 300,000 tpa, with sales of 170,000 tonnes in 2015.  The company operates bagging facilities and two Raymond Mills for processing Tianyan barite, with a combined capacity of 100,000 tpa <200 mesh barite powder.

Barite3 The main buyer of Tianyan barite, Xinji Chemical Co., part of Hao Hua Chemical Group, operates two barium carbonate manufacturing plants, one close to the Tianyan mine in Tianzhu and the other in Xinji, in Hebei province. 

Barium carbonate is manufactured from natural barium sulphate (BaSO4) by reduction with petroleum coke, followed by precipitation with carbon dioxide.  Applications for barium carbonate include electronic components, such as electronic ceramics, positive temperature co-efficient (PTC) thermistors and capacitors.

At present, Xinji Chemical consumes 200,000 tpa chemical grade barite from a number of mines in the Tianzhu area, but has plans to double this as it ramps up capacity. The company’s Hebei plant is likely to start taking more material from Tianzhu mines, owing to the deteriorating quality of barite it currently receives from mines in Ankang, in Shanxi province. 

The specific gravity (SG) range of barite from the Tianyan deposit is 3.90-4.35. Tianyan material containing up to 85% BaSO4 is supplied to Xinji Chemical for producing barium carbonate, while the bulk of material, which has an SG range of 4.10-4.25, is sold for drilling grade and the 4.25-4.35 SG barite fraction is used for both drilling and chemical purposes.   

Hong Sheng Mining Co.

Rocky Mountains owns 49% of Hong Sheng Mining Co., which operates the Tianhui mine in Guizhou. The mine is 2km from the Tianyan mine and has capacity of 100,000 tpa barite, with an SG range of 4.0-4.10.

Jun Xin Mining Co.

Rocky Mountains also has 51% share in the Yanhe white barite and fluorite (CaF2) deposit in Guizhou. The mine has a capacity of 30,000 tpa barite but current production is just 10,000 tpa. The barite-fluorite vein is four metres wide and jigging trials have been successful in separating most of the barite in the ore. The SG of the barite varies from 4.25 to 4.35 and it can be transported by either river barge to port or truck to beneficiation facilities in Guangdong.

Sanjiang barite deposit

The Sanjiang barite deposit in Guangxi is 100% controlled by Rocky Mountains. It contains stratiform barite, dipping at around 70-80 degrees. The mine is not yet producing but detailed jigging trials have being carried out to improve the SG of the barite recovered. These trials have used a feed of 3.60-3.70 SG barite, which has been crushed to a size of 0-6mm and jigged to produce material with SG of 4.05-4.10. 

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Konghai Industrial Group 

Rocky Mountains carried out contract mining and sales for Hong Kong-based Konghai Industrial Group at the latter’s Yuanling deposit in Hunan. Yuanling’s barite occurs in veins of between 500cm and two metres in width over a 3.2km2 area.  Resources are estimated at 12m tonnes and the barite is mainly whitish in colour, with some iron staining. Its SG varies from 4.10 to 4.35, depending on the amount of quartz present. Iron oxide (Fe2O3) levels are generally 0.06-0.11%, with low levels of mercury (Hg), cadmium (Cd) and other trace elements. Soluble carbonate levels vary from 500-600 mg/L and are blended with barite with higher soluble carbonate levels.

The mine’s processing plant has a Raymond Mill which produces <200 mesh barite powder. 

Yichang Zhongrun Barium  Industry Co. Ltd

In May this year, Yichang Zhongrun Barium Industry Co. Ltd and Zhangjiacun Barite Ore Co. Ltd contracted Rocky Mountains as their sole agent for exporting barite lump and milled powder products. The agreement is valid until 1 June 2018. The location of mine, plants and port for shipment of Yichang Zhongrun are in Figure 7.  

Yichang Zhongrun owns the Zhangjiacun barite mine and processing plant. The Zhangjiacun mine has estimated resources of 17m tonnes vein-type barite. The ore is mainly barite with fluorite within limestone and the company’s licence to mine the deposit runs for 9 years until August 2025. Mining takes place underground over a licence area of 0.36 km2 and the ore is then taken by truck to the processing plant. 

The Zhangjiacun processing plant crushes the barite to a size of 0-6mm. 

The SG of the plant feed is 3.85 and the processed product has an SG of 4.221.  Waste material with an SG of around 3.22 is stored for future processing. Once crushed, the barite is taken by truck to a powder plant in Yidu, which produces 200 mesh barite powders.  

The Yidu plant houses a 70,000 tpa Raymond Mill and a bagging facility. Up to 10,000 tonnes of 0-6 mm barite is loaded at Yidu and taken to Changshu via the Yangtze River to transfer to 50,000 tonne vessels for export. In 2015, 180,000 tonnes of barite was sold from the facility, comprising 160,000 tonnes of 0-6mm bulk material and 20,000 tonnes of <200mesh powder.

The Yinlin mine in Tianzhu has been in operation since 1996. Shenzen Xinshike Co., which now owns Yinlin, was founded in 2003. The deposit has resources of around 1m tonnes barite and the associated Dalong processing plant near Tongren has a capacity of 100,000 tpa of 200 mesh and 325 mesh barite powders with SG of 4.20-4.30. At present, however, the plant is only operating at half capacity.Shenzhen Xinshike Co. Ltd

Acknowledgements

Rocky Wu (Shenzhen Rocky Mountains Development Co. Ltd); Yang Bo (Yichang Zhongrun Barium Industry Co. Ltd); Professor Wen Lu (Chengdu, China); Bill Wang (Sinobarite Mining, Guizhou); USGS Mineral Commodity Summaries; Barite reports by Michael Miller (2011, 2012, 2013, 2014) and Michele McRae (2015, 2016).

*Ian Wilson is a UK-based industrial minerals consultant.