China National Gold Group Corporation
|Traded as||SEHK: 2099
|Industry||Mining, retail, contract engineering, irradiation sterilization|
|Song Xin, CEO|
|Products||Gold, copper, silver, molybdenum|
|Revenue||RMB 110 billion (2013)|
|RMB 1.91 billion (2013)|
China National Gold Group Corporation (中国黄金集团公司) (CNGC or China Gold) is a centrally state owned Chinese gold corporation primarily engaged in the mining and refining of gold, silver, copper, and molybdenum, and in the retail of custom-designed gold and silver bars.
The company began developing the Jiama gold and copper mine in Tibet in 2008, undertaking a $520 million investment that was then the largest mining project in the province. To maintain good relations with local communities, the company announced the hiring of 191 locals and stated 35% of the workforce was non-Han, the highest percentage of any mine in China. A landslide in March 2013 buried a worker's camp, killing 83 miners, two of whom were Tibetans. Government officials explained that the landslide was caused by a "natural geological disaster" rather than related to mining work. An article by The Economist questioned the building of a worker's camp in an area of hazardous geology.
In pursuit of additional gold mining assets, the parent company and its international development subsidiary, China Gold International Resources, is active in scouting for overseas gold mines. Explaining the acquisition strategy to the South China Morning Post, Song Xin, the chief executive of China Gold International Resources, stated the company was zealous in scouting for gold, copper, and silver mines across the world in both developed and developing countries.
China Gold made a bid at the end of 2012 for the Tanzania operations of Barrick Gold in a deal that would have exceed $2 billion. However the deal didn't go through because of disagreements that included the sharing of surprise tax increases levied by Tanzania to take advantage of the capital gains bonanza from a successful deal and indemnification for a past violent episodes between Barrick and villagers. Despite this setback, enthusiasm for deal making was reiterated in a September 2013 comment made by China Gold executive Jerry Xie to Reuters when he stated the company continued to look for big potential deals.
In December 2013, China Gold acquired Soremi, a copper mining subsidiary located in the Republic of Congo, from the Gerald Group, a US-based metals trading company. This marked the beginning of a joint venture between China Gold and the Gerald Group to further develop the project.
The company has been in talks with Banro, a Canadian gold mining company, to form a joint venture to develop mines and the supporting electricity supply in the Democratic Republic of Congo. Preliminary talks between the miners were reported in April 2011 when the companies signed a non-binding memorandum of understanding (MOU).
CNGC in January 2012 acquired the Kuru-Tegerek Copper-Gold deposit, a copper and gold mine located in the Kyrgyz Republic, for $21 million from the Chaoyue Group. The mine contains 97.36 tons of gold and 1.02 million tons of copper.
Other business areas
Besides its main mineral related business, the company also offers irradiation sterilization services to food, medical, and cosmetics companies in China, Hong Kong, and Macao. Subsidiaries are also engaged in contract engineering, import and export, and labor services for more than 40 overseas companies. China Gold also produces gold industry news publications and is the official news outlet for the Shanghai Gold Exchange and Shanghai Diamond Exchange.
- "China Gold's Report on Social Responsibility in 2013". China National Gold Group Corporation.
- "The price of gold". The Economist. April 6, 2013.
- Ng, Eric (April 9, 2013). "China Gold panning for overseas options". South China Morning Post.
- "Barrick Gold Ends Chinese Talks to Sell African Unit". Bloomberg. January 8, 2013.
- "For the next round of gold deals, small is beautiful". Reuters. September 27, 2013.
- "Gerald Metals and China National Gold Group Complete Cooperative Acquisition of Soremi Project" (PDF). Gerald Group.
- "Why Banro is looking for a Chinese dance partner in the DRC". Mineweb. 22 April 2011.