Mine fire interrupts gold output

08:57, August 11, 2010      

Email | Print | Subscribe | Comments | Forum 

China's largest gold-producing city halted output after a fire at a mine killed 16 workers, prompting investors to sell shares of Zijin Mining Group Co and Shandong Gold Mining Co.

Yantai city, which normally accounts for 15 percent of the nation's bullion output, ordered safety checks at most mines on Aug 7, Zijin said on Tuesday in a statement to the Hong Kong exchange. Shandong Gold said four of its mines are affected.

Zijin fell 2.5 percent to HK$5.46 (70 US cents) in Hong Kong trading on Tuesday.

Shandong Gold Mining fell 4.08 percent to 38.07 yuan ($5.62) in Shanghai trading on Tuesday.

Yantai, in Shandong province, has about a tenth of China's gold resources, according to the city government. The nation is the biggest bullion producer.

The fire, caused by overheated power cables, took place at Luoshan Gold mine, run by State-owned Shandong Zhongkuang Group Co.

"Officials from Yantai are doing a check-up of our ventilation, drainage and power supply systems today," Lin Pufang, Shandong Gold's company secretary, said by phone on Tuesday. "If we meet all the requirements, we'll probably be able to resume production as early as tomorrow."

The company doesn't expect a "major impact" on production, Lin said. Linglong Gold Mine, Jiaojia Gold Mine, Sanshandao Gold Mine and Xincheng Gold Mine are controlled by Shandong Gold in Yantai.

Zhaojin operates six mines in Yantai with a combined annual output of between seven and eight tons, said spokesman Li Jia. Total gold production last year was 11.3 tons according to its annual report. The company expects production to resume soon after checks, Li said.

Production at Zijin's Longkou Jinfeng unit, targeting output of 340 kilograms this year, would be affected, China's largest gold producer said. Jinfeng produced 161 kilograms of gold in the first half, Zijin said. Work at Longkou Jintai, an exploration unit, was also halted, it said.

Shandong accounted for about 1 percent of Zijin's output last year, and the main issue for the company is still the toxic spill at its Zijinshan mine last month, said Luo Rongjin, a Beijing-based analyst with Bocom International Holdings Co.

Zijin last month leaked toxic waste into the Ting River in Fujian province, poisoning almost 2,000 tons of fish, in the industry's worst spill in two years.

"China is at a period with rapid industrialization and urbanization, in which there's a large gap between production safety conditions and the requirement of safety development," Luo Lin, chief of the State Administration of Work Safety said in a commentary published on Aug 1, according to the government agency's website.

Source:China Daily


  • Do you have anything to say?


Special Coverage
  • Premier Wen Jiabao visits Hungary, Britain, Germany
  • From drought to floods
Major headlines
Editor's Pick
  • Staff members watch a screen showing the blast-off of the Long March-2FT1 carrier rocket loaded with Tiangong-1 unmanned space lab module at Beijing Aerospace Control Center, Sept. 29, 2011. Commander-in-chief of China's manned space program Chang Wanquan announced Thursday night that the launch of Tiangong-1 space lab module was successful. (Xinhua/Wang Shen)
  • Chinese President Hu Jintao watches the launch of Tiangong-1 space lab module at Beijing Aerospace Control Center in Beijing, capital of China, Sept. 29, 2011. Other members of the Standing Committee of the Political Bureau of the Communist Party of China (CPC) Central Committee, including Wu Bangguo, Jia Qinglin, Li Changchun, Xi Jinping, Li Keqiang and Zhou Yongkang, are also present. (Xinhua/Rao Aimin)
  • The graphics shows the launch procedures of the carrier rocket of Tiangong-1 space lab module, Long March-2FT1 on Sept. 29, 2011. (Xinhua/Lu Zhe)
  • Image taken from Beijing Aerospace Control Center shows a Long March-2FT1 carrier rocket loaded with Tiangong-1 unmanned space lab module blasting off from the launch pad at the Jiuquan Satellite Launch Center in northwest China's Gansu Province, Sept. 29, 2011. (Xinhua)
  • On Sept. 28, tourists travel around the Mingshashan Scenic Area in Dunhuang, Gansu province by camel. With the National Day vacation right around the corner, more and more tourists from home and abroad are going to Dunhuang. Riding on a camel, they travel in the desert to enjoy the cities rare form of natural scenery. (Xinhua/Zhang Weixian)
  • Chinese forest armed forces work together with forest firefighters on Sept. 28. (Xinhua/Chai Liren)
Hot Forum Discussion