Sino Prosper to boost gold mining on mainland

PUBLISHED : Tuesday, 08 February, 2011, 12:00am
UPDATED : Tuesday, 08 February, 2011, 12:00am

Sino Prosper State Gold Resources Holdings plans to invest HK$300 million to boost its mining and processing capacities on the mainland.

The company aims to increase the capacity of its Aohanqi Xinruien mine in Inner Mongolia from the current 600 tonnes per day to 2,500 tonnes in the third quarter of this year.

Production capacity is expected to increase from 500 tonnes of treated ore per day to 2,000 tonnes by the end of the year.

'We have HK$300 million in the bank, so there is enough money for expansion,' said Richard Sung, the chief executive of the company. 'We will spend HK$100 million to boost production capacity to 2,000 tonnes per day, HK$100 million to build refining and smelting facility in Inner Mongolia, and HK$100 million to set up a processing plant in Heilongjiang [province].'

Garry Stein, a director of corporate development, said the company would continue to acquire mainland mines and strive to keep production costs down. 'Our strategy is to increase resources per share, and production per share.'

Stein predicted gold prices could experience fluctuations but added that the company's expansion was driven by production growth rather than gold prices. He expected profits to continue to grow in the coming years irrespective of gold prices.

Shares in Sino Prosper closed at 40 HK cents yesterday, down 1.2 per cent.

The company's market capitalisation stands at HK$2.81 billion, up from HK$400 million in 2009. It has a mining licence in Inner Mongolia and a licence for exploration in five areas in Heilongjiang.