Owing to the tough macroeconomic climate and the sustained drop in gold prices, GobiMin is not proceeding with the development plan for the Sawayaerdun Gold Project in Xinjiang Uygur Autonomous Region. However, the company has received updated resource estimates with total measured and indicated resources of 26.84 million tonnes @ 1.79 grams/tonne gold for 1.545 million ounces, and total inferred resources are 59.38 million tonnes @ 1.38 grams/tonne for 2.626 million ounces.
The mineral resources contained within the project have been independently estimated by Mining One and are based on data collected by GobiMin as at October 13, 2014. The 2014 resources have been estimated using results from 313 surface diamond drill holes for a total of 97,204 metres plus adits and trenches.
The resource 2014 infill drilling results have further increased the confidence and understanding of the mineralization particularly within the measured and indicated areas of the resources and thus provide more reliable data for the mining plan.
The estimates include the Zone IV and Zone 1 areas. In Zone IV there are measured and indicated resources of 26.84 million tonnes @ 1.79 grams/tonne for 1.545 million ounces and inferred resources of 49.71 million tonnes @ 1.39 grams/tonne for 2.222 million ounces. In Zone 1 there are 9.67 million tonnes in the inferred category @ 1.30 grams/tonne for 404,000 ounces.
GobiMin holds an equity interest of 48.02% in Loco Hong Kong Holdings Ltd which together with its subsidiaries are engaged in the processing and trading of metals and commodity forward contracts. Loco HK has commenced design of a laboratory with assistance from the Hong Kong Productivity Council to match with a plan of expansion. Loco HK is also studying the possibility of building a raw material supply base in China.
The group owns 40% equity interests each in three exploration companies incorporated in Xinjiang for nickel, copper and gold.
They are treated as associates of the group. The net cost of the investment in these three exploration companies amounted to $0.7 million. The carrying value of these companies as at March 31, 2015 was $0.3 million. GobiMin is seeking opportunities to sell the exploration licences of these companies.