Gold companies take a shine to China's Silk Road

China Gold International Resources

24/09/2017 17:06

By Tom Daly 
    TIANJIN, China Sept 24 (Reuters) - As far as China's miners 
are concerned, the modern-day Silk Road is paved with gold. 
    Buoyed by a 15 percent rise in the gold price  XAU=  this 
year, Chinese mining executives in Tianjin this weekend were 
talking up their ambitions for overseas expansion. 
    In doing so they embraced Chinese President Xi Jinping's 
Silk Road Economic Belt and 21st Century Maritime Silk Road, now 
being promulgated around the world as the Belt and Road 
Initiative, the geographical scope of which has not been 
precisely defined. 
    Song Xin, CEO of China National Gold Group Corp, told a 
session of the China Mining conference on Saturday that his 
company would "intensify exploration and capital allocation in 
Belt and Road countries", which he said account for 80 percent 
of global gold consumption. 
    China National Gold has mandated its Canada-based subsidiary 
China Gold International Resources Corp  CGG.TO , with making 
overseas acquisitions. 
    On China's doorstep, in Mongolia and Central Asia, the 
company could deploy its proprietary technology for 
hard-to-extract reserves, Song said, calling on other Belt and 
Road countries to "enjoy the benefits" of mineral wealth 
together. 
    Investment in overseas gold projects is also a platform to 
promote the internationalisation of the yuan, he added.  
    Another state-run Chinese gold miner, Zijin Mining Group Co 
 601899.SS , is already generating half of its revenues abroad, 
said executive director George Fang. 
    Having embarked on a "go global" strategy in 2005, the 
company already has projects in three countries along the 
ancient Silk Road, Tajikistan, Kyrgyzstan and Russia, Fang said 
on Sunday.  
    Based in Fujian in southeast China, the starting point of 
the ancient maritime Silk Road, Zijin is also active in South 
Africa, the Democratic Republic of Congo, Australia, Papua New 
Guinea and Peru, he added. 
    Following Zijin's lead, Shandong Gold Mining Co  600547.SS  
in April took a 50 percent stake in Barrick Gold's  ABX.TO  
Veladero mine in Argentina.  urn:newsml:reuters.com:*:nL3N1HE26T 
    Emboldened by the moves of its peers, another Shandong 
miner, Zhaojin Mining Industry Co  1818.HK , has set a three-to 
five-year horizon to set out along the Silk Road and establish 
an overseas presence, according to its president, Li Xiuchen. 
    But he warned that the lessons learned from the 
environmental crackdown on mining practices within China should 
be applied overseas.  
    "If we cannot adhere to the environmental protection 
standards, we will not be able to do business there," Li said. 
 
 (Reporting by Tom Daly; Editing by David Goodman) 
 ((tom.daly@thomsonreuters.com;)) 
 
Keywords: CHINA METALS/GOLD