Western Mining gets approval for Tibet mine
Western Mining, a mainland integrated metal producer, has obtained government approval to develop the country's largest copper deposit, requiring a total investment of 1.82 billion yuan.
Top mainland planning body the National Development and Reform Commission has given approval for construction to start on the first phase of Yulong copper mine, the Xining, Qinghai-based metal producer said in a statement to the Shanghai Stock Exchange.
The mine, located in a densely forested area of Tibet, close to the Himalayas, has proven reserves of 6.25 million tonnes and potential reserves of 10 million tonnes, accounting for more than one-tenth of the country's total copper reserves.
The first phase will be developed by 58 per cent-owned subsidiary Tibet Yulong Copper, the mainland's seventh-largest copper miner said in the statement. Hong Kong-listed Zijin Mining owns 22 per cent of Yulong Copper.
The project is expected to produce 990,000 tonnes of copper ore and 30,000 tonnes of refined copper a year, Western Mining said without giving a detailed timetable.
China, the world's biggest copper consumer, imports about 75 per cent of the copper concentrate it needs to produce refined copper.
The output of the mine, the second-largest of its kind in Asia, will contribute to easing the mainland's copper concentrate shortage, analysts said.
Western Mining, which is also the mainland's second-largest lead miner and fourth-largest zinc miner, said it will use part of the 6.2 billion yuan in proceeds it raised in its July initial public offering to fund the project.
Mainland copper producers are seeking overseas resources to feed fast-growing smelting capacity and surging demand for the metal.
Jiangxi Copper, the mainland's largest integrated copper producer, on Wednesday said it would invest in a US$3 billion copper project in Afghanistan, which has estimated reserves of 11.3 million tonnes, with China Metallurgical Group.
Chinalco, the mainland's biggest alumina and aluminium producer, in August completed a US$860 million takeover of Peru Copper which could give it total copper reserves of 20 million tonnes.
Shares in Western Mining fell 6.39 per cent to close at 36.63 yuan yesterday. The stock has risen 172 per cent from its offer price.
The mine will ease the mainland copper concentrate shortage
The copper deposit, located in Tibet, has potential reserves of, in tonnes: 10m