Research Report
North Korea's Energy Law Study Ⅱ - the underground resource law
I. Background and Purpose of Research
▶ Research Background
○ Underground resources constitute a critical foundation for national economies. For decades, the development and utilization of such resources have played a pivotal role in sustaining economic growth. In the current era of "technological innovation," mineral and underground resources are regarded not only as key drivers of economic development but also as strategic assets essential to economic security in the evolving global industrial landscape.
- The advancement of cutting-edge industries—including artificial intelligence(AI), semiconductors, and renewable energy—presupposes the stable supply of strategic mineral resources as a prerequisite for technological progress, national security, and sustainable development.
- In particular, securing a reliable supply chain for critical minerals is increasingly recognized as a top strategic priority in maintaining and enhancing global competitiveness in industries such as semiconductors, AI, and clean energy.
○ Amidst rising interdependence and geopolitical tension over resource access, external reliance on resource imports presents a significant vulnerability for advanced industries. For South Korea—characterized by limited domestic mineral reserves and high dependence on imported resources—establishing a stable and autonomous resource base is now a critical imperative for sustaining national growth and security.
○ While South Korea has achieved international competitiveness in technology, industry, and infrastructure, the country faces structural limitations due to its narrow range of domestically available mineral resources. As a result, a substantial portion of strategic resources continues to rely heavily on overseas imports.
○ In contrast, North Korea possesses abundant underground resources, many of which are of high strategic value in global markets. Notably, North Korea is known to have one of the world’s largest deposits of magnesite, a critical mineral categorized as a "strategic and useful mineral", widely used in semiconductor and secondary battery industries.
○ North Korea has long recognized the strategic significance of its mineral wealth, establishing resource development as a central component of its national industrial policy. Underground resources are treated as both industrial raw materials and key assets to attract foreign investment.
○ Nevertheless, despite its abundant mineral endowments, North Korea's resource development has been significantly hindered by chronic shortages of capital and technology, compounded by ongoing international sanctions. These constraints have prevented the country from fully industrializing its resource sector or realizing its potential economic benefits.
○ In this context, inter-Korean cooperation in the field of mineral resource development has emerged as a potentially mutually beneficial model. It offers South Korea a strategic opportunity to diversify and secure its resource supply chain while contributing to North Korea’s economic revitalization and industrial modernization. Accordingly, resource cooperation has been increasingly highlighted as a practical and sustainable model of mutual interest for the two Koreas.
▶ Research Purpose
○ This study aims to conduct a systematic and in-depth analysis of the DPRK's Mineral Resources Law, with a focus on elucidating the legal structure and regulatory framework through which the law governs the development, management, and protection of underground resources.
○ The Mineral Resources Law functions as a foundational legal instrument in North Korea, designed to support state-led development and systematic management of mineral resources. It is grounded in core legislative principles such as the efficient utilization of resources and the pursuit of sustainable development and preservation.
○ Accordingly, this study seeks to analyze the legal and institutional architecture of the law, while also considering its connection with North Korea’s broader resource management policies and actual resource endowments. In doing so, the research will examine the legislative history, amendments, and normative characteristics of the Mineral Resources Law, with the aim of providing a comprehensive understanding of its legal significance and policy implications.
II. Main Content
▶ Current Status and Policy of Mineral Resources in North Korea
○ Approximately 80% of North Korea’s territory is reported to be distributed with strategically useful mineral resources, and various official data and reports indicate that over 200 types of minerals are considered economically viable.
- The abundance of underground mineral resources in North Korea can be attributed to the country’s geological structure, which has been shaped by complex tectonic activity conducive to the formation of mineral deposits (鑛床).
- Based on this geological advantage, North Korea has long placed strong emphasis on the development of underground resources, making resource exploitation a foundational pillar of its national industrial policy.
○ Prior to the Kim Jong-un regime, North Korea pursued a proactive mineral resource development policy grounded in three strategic goals: post-colonial liquidation, postwar reconstruction, and advancement of the mining sector.
- In particular, the state emphasized the integration of advanced scientific and technological methods in the exploration and development of mineral resources. The development of such resources was designated as one of the strategic priorities in major national programs, such as the “20×10 Regional Development Policy” and the “Five-Year Economic Development Plan.”
- However, under Kim Jong-un’s leadership, despite efforts to continue resource-based export policies, North Korea has faced significant difficulties in maintaining normal levels of production. These challenges stem primarily from deteriorating mining infrastructure and the imposition of comprehensive international sanctions. As a result, the mineral resource sector has struggled to remain economically viable and lacks competitiveness in the global market.
▶ Key Provisions and Characteristics of the DPRK’s Mineral Resources Law
○North Korea has long regarded the development of underground resources as a foundational component of its national industrial policy. Leveraging its abundant mineral endowments, the state has classified mineral resources as strategic assets for national economic development. In particular, these resources are recognized both as promising export commodities and as essential raw materials for domestic industrial growth. Accordingly, the state has continuously strengthened its authority over the exploration, development, and utilization of such resources through a centralized command-and-control model, while simultaneously encouraging citizen participation in resource-related initiatives. This approach has been accompanied by sustained efforts to revise and refine the legal framework governing the resource sector.
○In alignment with this policy direction, North Korea has in recent years enacted and amended several key statutes—including the Mineral Resources Law (2021), the Coal Law (2021), and the Law on Small- and Medium-Sized Coal Mines (2021)—as part of a broader effort to systematize and modernize the legal structure governing mineral resource development and management.
○A particularly distinctive feature of North Korea’s resource law lies in its treatment of mineral springs(鑛泉資源). Beyond their conventional industrial value, these resources are designated as “national health resources” in light of North Korea’s deficient public health infrastructure. Thus, unlike in other jurisdictions, the regulation and development of mineral springs in North Korea are closely linked to public health policy, offering a unique insight into the country’s law-and-policy integration model.
○Furthermore, North Korea treats underground resources not merely as economic assets but as strategic domains subject to strict state control and protection from external threats. To this end, the state has established a multi-tiered legal sanctions regime that imposes civil, administrative, and criminal liability for violations related to mineral resource activities. This layered system of legal accountability reflects a comprehensive framework for regulating all stages of resource development and utilization under centralized state oversight.
▶ Policy Recommendations for Enhancing Inter-Korean Cooperation in the Mineral Resource Sector
○In recent years, North Korea has actively sought to advance its system for managing underground resources by improving the level of statistical analysis and data digitization. This includes efforts such as the development of a centralized Mineral Resource Reserve Database, as well as systematic assessments of mineral deposits by type and grade. These developments reflect an ongoing internal effort to enhance resource management capabilities and to modernize the strategic planning behind resource development.
○Discussions on inter-Korean cooperation in the field of mineral resource development have occurred intermittently over the past decades, with multiple agreements and initiatives proposed between the two Koreas. There has been a shared recognition—at least at a rhetorical level—of the mutual necessity and legitimacy of collaboration in this sector. However, a recurring challenge lies in the implementation phase: despite formal agreements, actual progress has been hindered by institutional and political constraints inherent in the inter-Korean relationship. These limitations have prevented the translation of cooperative frameworks into tangible outcomes.
-One of the most significant obstacles to inter-Korean mineral resource cooperation is the continuing sanctions regime imposed by the United Nations Security Council(UNSC), which is directly linked to North Korea's nuclear weapons development. Given the normative and binding nature of these international measures, it is unlikely that the sanctions will be eased in the foreseeable future. On the contrary, they are expected to be maintained or further strengthened, making transformative inter-Korean cooperation in the area of mineral resource development highly improbable under current geopolitical conditions.
-Nevertheless, it is essential to engage in preparatory measures for future cooperation, taking into account the possibility of a positive shift in inter-Korean relations in the mid- to long-term. Such preparations must be grounded in a detailed and systematic analysis of North Korea’s most recent legislative developments, including primary legal sources. A particularly critical aspect of this preparatory work involves understanding the fundamental differences in legal frameworks and approaches to resource development between the two Koreas.
-For instance, Article 32 of North Korea’s Mineral Resources Law refers to the concept of "economic feasibility"; however, in practice, there appears to be a lack of rigorous consideration for actual mining conditions or cost-benefit evaluations. As a result, there is a high risk of indiscriminate development of economically unviable or environmentally unsustainable resources. This poses not only challenges to resource efficiency and ecological sustainability but also undermines the effectiveness of potential inter-Korean cooperation, particularly due to conflicting technical standards and economic assessment criteria.
○ Furthermore, differences in how the two Koreas conceptualize and assess economic feasibility in resource development may pose significant challenges to effective technical cooperation and economic exchange in the mineral resource sector.
-Furthermore, differences in how the two Koreas conceptualize and assess economic feasibility in resource development may pose significant challenges to effective technical cooperation and economic exchange in the mineral resource sector.
-Among these, a particularly critical barrier is the conceptual divergence regarding “resource quantity” and “reserves”. In South Korea, operating within a capitalist economic system, there is a clear and strict distinction between these two concepts. Only those resources that meet specific technical, economic, and legal criteria—such as proven extractability and market value—are classified as reserves.
-In contrast, North Korea, under its socialist system, regards underground resources as part of the nation's collective wealth and determines their utilization based on the needs of a centrally planned economy. As a result, even mineral deposits with low or marginal economic value are often included in the category of "reserves."
-This fundamental discrepancy may lead to confusion and inconsistency across all stages of joint development projects, from feasibility studies and investment decisions to risk assessment and operational planning, ultimately impeding the establishment of an effective and mutually acceptable cooperation framework.
○Therefore, in order to facilitate substantive cooperation between South and North Korea in the field of mineral resource development, it is essential to first establish a unified standard that can reconcile the differing perceptions of economic feasibility and resource evaluation criteria between the two parties. To this end, it is necessary to explore the adoption of internationally recognized and credible resource classification frameworks. At the same time, a careful and comprehensive analysis of the unique characteristics and operational structure of North Korea’s resource-related legal system must be undertaken, so that cooperative strategies can be developed in a manner that enhances institutional compatibility and legal harmonization between the two Koreas.
III. Expected Contributions
○This study is expected to provide a practical and concrete policy foundation for the realization of peace and shared prosperity on the Korean Peninsula by offering a comprehensive analysis of the potential for inter-Korean cooperation in the field of mineral resources, as well as the institutional and policy-related challenges that accompany such efforts. In particular, by addressing the divergence in resource reserve classification standards—one of the most critical issues in inter-Korean resource cooperation—this research aims to present both a theoretical framework and practical alternatives that may contribute to the establishment of a trust-based cooperation mechanism.
○Furthermore, the study lays the theoretical groundwork for a cooperative model that incrementally incorporates internationally recognized standards into North Korea’s resource assessment and management systems. This approach seeks to promote both economic viability and environmental sustainability. Such a model would not only facilitate joint resource development but also contribute to achieving the Sustainable Development Goals (SDGs) by promoting an ecologically and economically balanced approach. Ultimately, this could serve as a stable foundation for long-term economic development for both South and North Korea.