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To: mishedlo who wrote (36677)	7/22/2005 4:28:38 PM
From: RealMuLan	Respond to of 110194

China's gold production set new record China produced 212.35 tons of gold in 2004, setting a new annual record, according to the China Gold Association. East China's Shandong Province remained the country's largest gold producing area with 64.5 tons of gold output in 2004. Other major gold producing areas include Henan, Fujian, Shaanxi, Liaoning and Hebei. An official with the association said China's gold production had experienced fast growth since the mid-1990s. China produced only 90 tons of gold in 1994. "Growth of China's gold industry faces a golden opportunity," said an official with the association. "China has a huge population of 1.3 billion and the Chinese economy grows very fast." According to the association, China is the world's fourth largest gold producer and consumer. english.people.com.cn ======================== Summary: China's gold mine production reached a record 213 tonnes in 2003 , but this amount is still insufficient to satisfy the demand for gold for jewellery and industry which is running at around 250-300 tonnes a year. Some estimates suggest that China's demand for gold may reach 600 tonnes a year within the decade. The shortfall will need - as in the past - to be met by imports. The mining industry is fragmented (though being reorganised), with many small mines, where pollution and safety are major issues. Even the larger mines produce a maximum of only a few tonnes. Exploration has been impeded by the re-organisation of the industry. Investment by foreign companies has been sporadic and small – the mining majors have yet to commit. China has now had a decade of reform in the gold mining sector. After a recent pause, foreign exploration companies are now returning to China in large numbers, and there have also been some large-scale and exciting new finds. There are considerable opportunities: China's domestic gold mining remains small scale and would benefit from foreign assistance, particularly in the area of deep mining. Environmental concerns are also becoming more pressing with widespread pollution, and this is another area where foreign expertise would be of assistance. Furthermore domestic production has perhaps peaked at around 200 tonnes a year, but demand could easily reach 600 tonnes in the next decade. The implication is clear: either China steps up exploitation of its own resources (with or without foreign capital and technology), or it may be obliged to import large amounts of bullion. The position is already shifting: the market has already been thrown open with the flotation of major Chinese gold mines, both on the Shanghai and Hong Kong stock exchanges. At the same time the major foreign banks and funds have been permitted to take up "A" shares, previously restricted to Chinese nationals. To many foreign-based gold producers China represents a new frontier. Moreover, to a handful of the major producers the exploitation of gold resources in the country and within the wider Asian region as a whole is regarded as vital if current levels of mine production are to be maintained. The gold producing belts of North America and Australia, amongst others, are maturing, and to replace the existing reserve base new finds will have to supplement the (limited number) of success stories emerging from parts of Central and South America. One of the ways for majors to participate in exploration success is to enter at the grass roots level by taking a position in a junior “vehicle” with options to earn into any major finds. Included in Gold Mining in China, is a comprehensive list and status summary of 36 junior exploration companies currently active in the country. researchandmarkets.com ==================== And here is a Chinese offical site giving the gold reserve figure: As of Dec. 2004, China has 19,290,000 oz. of gold pbc.gov.cn