ZIJINSHAN GOLD MINE

Reported that the annual copper output of its copper mine beneficiating and smelting plant breaks through 10,000 tons.

Zijinshan Gold Copper Mine will endeavour to handle the co-ordination between its infrastructure investment and its production, to perform well in its fund raising project – joint mining of the gold and copper mines, to prepare for a new phase of technological innovation and exploration of the deep and the surrounding area, to achieve the production target for 2008, to increase its production. Zijinshan Copper Mine will put emphasis on the copper mining outside the open pit mining area, speed up the development of under-ground, improve the safety facilities and stabilise the production capacity.

The second gold refinery plant was basically completed. Zijinshan Gold Mine produced 271,063 ounces gold. Zijinshan Copper Mine produced 4,794 tonnes copper cathodes and the average unit cost of copper cathodes from Zijinshan was RMB13,683 per tonne which has decreased by 15.39% when compared to the same period last year. The decrease was mainly attributable to the fact that the selection grade of copper ore in Zijinshan has been improved (selected grade in the reporting period and the same period last year were 0.51% and 0.472% respectively) and the enlargement of the production scale resulted in the reduction in the average fixed cost. Unit cost decreased compared with the same period last year.