Hebei Iron & Steel Group, China's largest steel producer, signed with Luannan county government to explore two iron ore mines last Sunday.

The two ore mines, Macheng and Dajiazhuang, are located in Luannan county, Tangshan municipality of north China's Hebei province. Macheng was proven to have 10.44 billion tons of ore reserve last year, with another 500 million tons possible.

It was China’s largest-sized reserves-proved iron ore deposit discovered since the 1980s.

The exploration will ease the shortage of ore supplies and reserves, providing relief to the provincial and even national iron and steel industries.

Though the iron self-sufficient rate of Hebei is higher than the national average, Hebei still needs to import 100 million tons and the steel industries still rely on importation.

Hebei had an iron powder consumption of 183 million tons in 2008, which amounts to 400 milliion tons of raw iron ore.

By Guo Changdong and Zhang Nan