Western Mining in 3b yuan Hubei push
Western Mining, a leading mainland producer of zinc, lead, copper and aluminium, plans to invest three billion yuan to explore for lead and zinc and build smelters in Hubei, capitalising on the resources of the central province.
The Xining, Qinghai-based metal producer has signed a memorandum with the city government of Xiangfan, in northwest Hubei, to develop mines in the city and build smelting facilities at its Hekou Industrial Park, it said.
The move is part of Western Mining's strategy to expand out of its home base with the help of the 6.2 billion yuan raised in an initial public offering in Shanghai in July.
The company, in which Goldman Sachs has an 8.07 per cent stake, said it planned to invest three billion yuan to build a crude lead smelter with annual capacity of 80,000 to 100,000 tonnes, a 100,000-tonne zinc smelter and ancillary facilities at the industrial park in the next three to five years.
The project, which would be the first lead and zinc plants in Hubei, was expected to generate 4.5 billion to five billion yuan in sales annually and contribute 500 million to 700 million yuan in tax revenue to the city coffers, it said.
Zinc and lead deposits often occur together because, as elements, they have similar chemical behaviour and combine with sulphur as primary minerals. Zinc is mainly used for galvanising steel and iron in making brass and other metal alloys. Lead is commonly used in batteries.
Western Mining in August reported that its first-half profit surged 54.7 per cent to 854.7 million yuan on turnover of 3.46 billion yuan.
Investment aimed at taking advantage of mineral-rich province
The amount raised by the company in its July initial public offering, in yuan: 6.2b yuan