Zhaojin Mining Acquires 79% Equity Interest in a Gold-Copper Mine Company for RMB600 Million

HONG KONG, Dec. 30, 2011 /PRNewswire-Asia/ -- Zhaojin Mining Industry Company Limited ("Zhaojin Mining" or the "Company" and, together with its subsidiaries, the "Group"; stock code: 01818), a leading gold production enterprise in China, announced to acquire an aggregate of 79% equity interest of Baicheng Xian Dishui Copper Mine Development Company ("Target Company") at a cash consideration of RMB600million. Upon completion of the acquisition, the Target Company will become a non-wholly owned subsidiary of the Company.

The Target Company is principally engaged in copper ores mining, processing and sale of copper ores and by-products, relevant technical consultation services on the mining and processing of copper mines. The Target Company is the owner of Dishui Gold-Copper Mine, where a gold-copper mine project is undertaken by the Target Company. Dishui Gold-Copper Mine is a gold-copper mine project located in Xinjiang Uyghur Autonomous Region, the PRC. The Company believes that Dishui Gold-Copper mine has been benefiting from the favorable exploration conditions. The mine, which reserves are of medium size, is being adequately prospected and is believed to have reliable resources for exploration as confirmed by site investigation. Besides, the gold and silver contained in ores are available for comprehensive recycling, promising improvements of economic benefits are likely to be derived. It represents relatively huge potential for additional reserves to be discovered deeply in the mining area. The mine gets well matured as it is equipped with comprehensive production and living facilities, which guarantees operations immediately upon the acquisition. Meanwhile, the acquisition of such gold-copper mine will be helpful to address the raw material supply of copper concentrates for the Company’s subsidiary, Xinjiang Xinhui Copper Company Limited.

Mr. Lu Dongshang, Chairman of Zhaojin Mining, said, "The Group strives to maintain the gold reserves to grow steadily. We will strengthen our gold resources capability through enhancing exploration efforts and exploitation capability and potential acquisitions. We believe the acquisition can expand our resources and enhance our core competitiveness and profitability."

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About Zhaojin Mining Industry Company Limited

Zhaojin Mining Industry Company Limited is a leading gold production enterprise in the PRC. The Group is located in Zhaoyuan City in Shandong Province – the ‘Gold Capital' of China, holding 10% of the country's total gold reserves and having the longest history of gold mining in the PRC. The Group is principally engaged in the exploration, mining, ore processing, smelting and sale of gold products, and is the largest gold smelting enterprise in the PRC. The principal products of the Group include standard Au9999 and Au9995 gold bullion. Zhaojin Mining operates 6 mines in Zhaoyuan City. The Group also owns various gold mines throughout the northern, northwestern, southwestern of China. With its abundant gold resources, advanced technology and management, the Group has maintained a leading position in the industry.

Dishui Gold-Copper Mine

Dishui Gold-Copper Mine is a gold-copper mine project, where the gold grade is 0.41g/t, with a gold content of 2,757kg; the silver grade is 9.39g/t, with a silver content of 235,312kg; the copper grade is 1.06%, with a copper content of 265.6 thousand tons. Dishui Gold-Copper Mine is underground mined with a daily production capacity of 1,200 tons. The mine has completed the construction of a processing factory with a daily processing capacity of 1,000 tons, with a copper floatation recovery rate of around 80%.

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