Shares of Hong Kong and Australian-listed Sino Gold Mining slid 1 per cent yesterday to HK$54.50 after the company announced that gold production at its Jinfeng mine in Guizhou province would fall below target due to power shortages related to winter storms.
Trading in the company's shares was suspended in the morning session after the announcement but resumed in the afternoon.
Sino Gold said severe snowstorms had affected the delivery of coal to power stations in southern China, resulting in restricted electricity supplies in Guizhou.
It previously estimated that gold production in February would reach 12,700 ounces. It did not disclose projected figures for next month but said full power supply would not be available until February 21.
However, a BOC International report on Monday revised the company's target share price up by 5 per cent to HK$76.28, citing higher gold prices and reduced production costs.
Sino Gold said it expected to produce 170,000 to 190,000 ounces per year at an average cost of US$300 per ounce. BOCI said the company's target is in line with the bank's estimate of 180,000 ounces per year in 2008.
Sino Gold aims to cut production costs to US$275 per ounce by the end of this year and to US$250 per ounce by next year.
