Gold firm finds extra reserves at mine

Source: Xinhua  |   2008-7-8  |     NEWSPAPER EDITION

CHINA National Gold Group Corp said yesterday it had found a new vein with an estimated 15 tonnes of gold at one of its mines.

The Na Neng gold mine in southwestern Guangxi Zhuang Autonomous Region was previously thought to have a proven reserve of five tonnes, said an unnamed official with the country's leading gold producer, manufacturer and trader.

The country currently has 330 large-scale gold mines nationwide, with a daily gold ore output of 11,000 tonnes.

The company announced earlier the Ministry of Finance had provided it with 47.75 million yuan (US$6.96 million) from the 2008 central budget in a bid to help it prospect new mines.

This year, China surpassed the United States to become the world's second largest gold producer behind South Africa. In 2007, its gold output reached 270.491 tonnes, up 12.67 percent year on year.

To further boost the gold trade market and make gold resources more accessible to individual investors, Beijing Equity Exchange launched a gold trading center last weekend.

Gold bars can now be traded over-the-counter between buyers and sellers. Four weights of gold bars are sold at the gold center - one ounce, two ounce, five ounce, and 10 ounce.

Liang Yu, BEE's vice chairman, said the price of the gold bar comprises basic costs of the gold and other fees.

The BEE is in talks with several potential members and cooperators, said Liang.

Qiu Hanyi, a Jingyi Futures Co Ltd analyst, said gold prices were expected to continue rising amid surging oil prices in the world market and domestic inflation pressure.

"But investors should still be alert to trading risks," Qiu said.

China's gold consumption have maintained a strong growth momentum in recent years.

Sales in China, including Hong Kong and Taiwan, hit a record 363.3 tonnes last year.

Gold resources were estimated at 15,000 tons to 20,000 tons nationwide. China's proven gold reserves ranked 7th in the world.