Security and Production Update


 

TIDMCGM 
 
RNS Number : 4307S 
China Goldmines PLC 
18 May 2009 
 

 
 
China Goldmines plc 
("China Goldmines" (CGM) or the "Company") 
(AIM: CGM) 
CHINA GOLDMINES GUANZHUANG GOLD PROJECT 
Security and Production Update for the 1st April 2009 to 15 May 2009 
 
 
Highlights 
  *  8,590 tonnes mined in the 7 week period; 
  *  5,975 tonnes containing 2,193oz milled in the period; 
  *  Average grade achieved 12g/t; 
  *  Major security breach on 15 / 16 May 2009 resulting in theft of at least 5 
  tonnes of high grade ore (>1,000g/t); 
  *  Mining operations under review - Xiang Lu mine site closed but activity 
  continuing at Bao Mu Yuan and De Sheng plants; 
  *  826oz gold sold during the period at an average price of USD896/oz 
 
 
 
Security and safety issues 
The Company experienced an alarming attack on the 15th and 16th May that 
targeted our Xiang Lu (eastern mine site) and the Bao Mu Yuan Plant.  Fifty or 
more robbers broke into the mine sites and raided high-grade ore/concentrate and 
threatened staff. On the 17th May, CGM's Chinese Joint Venture Company, Hunan 
Westralian Mining Co., Ltd, decided to temporarily close the Xiang Lu mine site 
for the safety and wellbeing of the Company's Western and Chinese workers and to 
avoid further theft of high-grade ore. 
The Company is now working closely with the County Government and Police in 
reviewing this attack and taking all possible actions to apprehend the culprits 
and our immediate safety needs. 
Prior to this incident the Company has been impacted by small scale skirmishes 
that have been dealt with by internal security and local police. In the period 
under review, these have resulted in the closure of the Xiao Chong Zi Plant, 
together with the Zheng Jia Shan and Jiu Fa mines. This incident however 
represents a deterioration of security due to the number of robbers involved, 
the use of weapons and the physical and verbal threats to staff. It all appeared 
to be well co-ordinated and organised, with the objective of stealing the 
high-grade ore. 
Currently the Company is assessing the loss which is approximately 5 tonnes of 
high-grade ore (>1000 g/t) from the Xiang Lu mine site. It is difficult at this 
time to quantify the fine ore stolen from the Bao Mu Yuan Plant. The Company was 
fortunate there were no injuries to our workers. 
The western mining operations will continue cautiously and the Bao Mu Yuan and 
De Sheng plants will be in operation during the month of May. 
The Company will discuss with all stakeholders and the County Government how to 
move forward on strategic planning. 
Summary of Production 
From 1 April to 15 May 8,590T was mined, and 5,975T containing 2,193 oz gold was 
milled during the period.  Average grade achieved during the period was 12g/t. 
 
 
1st April to 15th May Mining Summary 
 
 
+----------+---------+---------+--------+--------+-------+--------+----------+-------------+ 
|          |  BMY    |  XCZ    |  SJY   |  DS    |  ZJS  |  XL    |  Total   |   Total     | 
+----------+---------+---------+--------+--------+-------+--------+----------+-------------+ 
|          |         |         |        |        |       |        |  Wagons  |  Ore (t)    | 
+----------+---------+---------+--------+--------+-------+--------+----------+-------------+ 
|April-09  |  2480   |   50    |  558   |  978   | 1363  |  382   |  5669    |    4514     | 
+----------+---------+---------+--------+--------+-------+--------+----------+-------------+ 
|  May-09  |  1568   |         |  588   |  715   |       |  171   |  2921    |    2311     | 
+----------+---------+---------+--------+--------+-------+--------+----------+-------------+ 
 
 
1st April to 15th May Milling Activity Results:- 
 
 
+---------+--------+---------+---------+----------+----------+---------+---------+---------+---------+ 
|  Month  | Plant  | Tonnes  |  Grade  |  Tails   |Recovery  |        Concentrate          |Gravity  | 
|         |        |         |  (g/t)  |  (g/t)   |    %     |                             |         | 
+         +        +         +         +          +          +-----------------------------+---------+ 
|         |        |         |         |          |          |  Grade  |Tonnes  | Au (g)  | Au (g)  | 
|         |        |         |         |          |          |  (g/t)  |        |         |         | 
+---------+--------+---------+---------+----------+----------+---------+--------+---------+---------+ 
|  April  |  BMY   |  3150   |  12.22  |  0.64    |  94.74   |  172    |  147    | 25,284  | 11,166  | 
+         +--------+---------+---------+----------+----------+---------+---------+---------+---------+ 
|         |   DS    |  937   |  4.75   |  0.55   |  88.38   |    95    |   25    |  2,437  |  1,498  | 
+---------+---------+--------+---------+---------+----------+----------+---------+---------+---------+ 
|  May    |  BMY   |  1,346  |  18.30  |  0.57    |  96.87   |  233    |   84    | 19,734  |  4,137  | 
+         +--------+---------+---------+----------+----------+---------+---------+---------+---------+ 
|         |   DS    |  542   |  7.89   |  0.59   |  92.57   |   146    |   18    |  2,652  |  1,311  | 
+---------+---------+--------+---------+---------+----------+----------+---------+---------+---------+ 
|      Total       |  5,975  |  12.00  |  0.60    |  94.00   |  182    |  274    | 50,107  | 18,112  | 
+---------+--------+---------+---------+----------+----------+---------+---------+---------+---------+ 
 
 
Sale of Gold 
A total of 826 ounces of gold was sold during this period at an average price of 
USD896/oz with gross receipt of USD740,794.  Gold sales included 118.8 (DMT) 
tonnes of gold concentrate at 86.3g/t and 15.44 kg of doré bars from gravity 
concentration. 
 
 
-ENDS- 
For further information contact: 
+-----------------------------------------+-----------------------------------------+ 
| China Goldmines plc                     |                                         | 
+-----------------------------------------+-----------------------------------------+ 
| Threadneedle Communications             | +44 (0)20 7653 9855                     | 
+-----------------------------------------+-----------------------------------------+ 
| Laurence Read/ Beth Harris              |                                         | 
+-----------------------------------------+-----------------------------------------+ 
| Frank Vanspeybroeck (CEO)               | +86 731 489 0755                        | 
| Marinko Vidovich (CFO)                  | +61 8 6216 5200                         | 
|                                         |                                         | 
+-----------------------------------------+-----------------------------------------+ 
| Brewin Dolphin Ltd (Nomad)              |                                         | 
+-----------------------------------------+-----------------------------------------+ 
| Alex Dewar                              | +44 (0)131 529 0276                     | 
+-----------------------------------------+-----------------------------------------+ 
| (Nominated Adviser)                     |                                         | 
|                                         |                                         | 
+-----------------------------------------+-----------------------------------------+ 
|                                         |                                         | 
+-----------------------------------------+-----------------------------------------+ 
|                                         |                                         | 
+-----------------------------------------+-----------------------------------------+ 
Notes to Editors 
 
 
China Goldmines plc is a UK mining company listed on AIM on 7 February 2006 as a 
gold resources company focussed on the discovery and development of gold 
projects in Hunan Province, China. 
 
 
CGM's Gold Project is known as the Guanzhuang Gold Project. Based on an 
Independent Geological Report, the project has an estimated inferred resource of 
1.8m ounces within the top 325m from the surface and over a strike distance of 
1.5km. The resources have been identified from CGM's 100% owned/controlled Shen 
Jia Ya Prospect, which is within the Guanzhuang Gold Project. 
 
 
The Shen Jia Ya Prospect consists of eight gold mines that have now been 
converted into a single mining licence. The Company plans to consolidate all 
eight individual mines. That consolidation may result in a mining operation with 
a long life producing 150,000 oz Au/pa, beginning in the near future. At the 
same time as mining the existing eight mines, China Goldmines will continue to 
investigate the potential of the project area that remains under-explored. 
 
 
 
 
 
 
 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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