The geologic environment was mostly resulted from the intrusion of magma which led to folding of the overlying volcanic series, the formation of the intrusive dome and the contact broken zone.

The Panxi rift zone is of complex tectonics, frequent earthquakes, and many magma activity episodes.

The ore-forming material and fluid was derived from the depth of the Earth especially from upper mantle or crust-mantle mixing zone , due to alkali-rich magma activity during late Yanshanian epoch.