DESPITE challenging conditions caused by weak global economic growth, disappointing demand, falling gold prices and increasing labour costs, Zhaojin Mining Industry Company Limited continues to perform well. In the six months to April 31, 2015, the group increased production by 10.7% to almost 532,700 ounces primarily from gold operations in Zhaoyuan district on Jiaodong peninsula, Shandong Province.
The Zhaojin Mining offices in Zhaoyuan City, Shandong Province.
Of this total almost 335,152 ounces was mine-produced gold, representing an increase of 7.61% on the corresponding period of 2014. Gold output from smelting and tolling arrangements accounted for approximately 197,542 ounces, representing an increase of 16.37%.
To better cope with challenging conditions, Zhaojin is focusing on cost reductions and increased efficiencies with these measures enabling it to effectively control integrated costs. The measures have been implemented in project development, material procurement, construction work and geological exploration.
In a half year report company chairman Weng Zhanbin said more than 100 million RMB was saved accumulatively in terms of capital expenditure. The group’s integrated cost of gold was approximately RMB135.21 per gram, positioning it at the low-end of the industry.
“As for infrastructure and technology reform, the group completed a total investment of RMB278 million. Key projects were carried out smoothly and according to schedule such as the demonstrative base for integrated utilization of gold resources in Shandong Province and gold extraction project with smelting and chlorinating in Gansu.
“The group implemented prudent and stable investment strategies. In the first half year, 18 exploration projects and 11 exploitation projects were accumulatively examined. In particular, the successful merger and acquisition of Haiyu Gold Mine project in Laizhou achieved a substantial breakthrough in exploration and increase in reserves. Currently, Haiyu resources have reached more than 470 tonnes and it is set to become a unique and large-scale mine.”
Zhaojin’s planned annual total output for the 2015 financial year amounts to 950,500 ounces with mined gold expected to total 646,800 ounces.
Weng Zhanbin said, “To cope with gold market challenges, the group will continue to optimize resources and further enhance its integrated strength to lay a solid foundation for long-term development. In the second half of 2015 the group will strengthen its efforts in production organization, key projects, cost reduction and efficiency enhancement, and reserve replenishment by mine exploration to accomplish and exceed the target.