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Tagged with: SGX

Aug 2003 - DnD - LHG, SGX, JBM

SWITCH from LHG to SGX, and JBM too?

  • I attended Diggers ‘n Dealers in Kalgoorlie last week and visited IGO’s Long Nickel mine afterwards (see separate report). I thought that there were a number of signs that we are entering into a resources boom. Unfortunately time restricts me from elaborating in great detail, and so mainly oneline comments have been made. However, the main conclusions based on the presentations, were : (in alphabetical order)
  • SWITCH : LHG to SGX, and possibly JBM partly to LIM or IGO/MCR.
  • BUY : IGO, OXR
  • SPEC BUY : GRD, KZL, MCR, PNA.
  • ACCUMULATE : LIM, NCM, SGW, One’s to watch :
  • APO : on the old SGW tenements at Laverton
  • AUZ : revitalising the old Blair nickel mine which is actually not flooded to surface.
  • GTR : maybe, looked interesting but I have never visited Tennant Creek.
  • And amongst the Major Offshore Golds (South African and North American) : (that I liked)
  • Gold Fields, Anglogold and Harmony. Commodities :
  • Gold : Both Newmont and Gold Fields were projecting higher prices to US$400/oz and beyond.
  • Zinc : Kagara presented a paper showing that the Zinc market appears to have bottomed. Zinc prices are often regarded as highly leveraged because they are coming off such a low base.

Apr 2004 - Sino Gold Limited

Sino Gold Limited (SGX) – Bringing Jinfeng into Production at 200,000ozpa

  • Sino Gold currently has two main projects in Central China, being its Jianchaling operating gold mine in the Shaanxi Province and its Jinfeng project in Guizhou Province. There are a number of other projects mainly in Northern China that are at various stages of acquisition and exploration.
  • Jianchaling has been winding down from 100,000ozpa in 2002 to possibly only 50,000oz in CY2004. Extensions to its life and potential increases to its production appear to be almost certain with 5 gold target areas being explored, however, at this stage their eventual actual outcome is almost impossible to predict.
  • Jinfeng is in the process of completing its feasibility study, which with over 3moz in resources and extensions to the stratabound mineralisation with intersections up to 59m @ 8.6g/t infers that board approval should be a formality. Gold production is expected to commence in early 2006 and build up to 200,000ozpa during that year.
  • Apart from potential success and ultimate production in its other joint venture projects in Shandong Province with Gold Fields, and over White Mountain in Jilin Province, SGX is at the negotiation stage in its “China Review Project” to obtain one or more joint venture agreements on non-refractory (free milling) gold projects that could be finalised in 2004, and which could then be brought into production.

Aug 2005 - Sino Gold Limited

Sino Gold Limited (SGX) –Targeting an achievable 500,000ozpa within 3 years

  • The Mining Licence (ML) approval for Sino Gold’s Jinfeng was received on 16 June 2005 on the basis of a 12-year life treating 1.2mtpa to produce 180,000ozpa from about SQ 2006. During the approval period, a scoping study was completed in November 2004 on Phase 2, being a 50% expansion of Jinfeng to 1.8mtpa to produce ~300,000ozpa from MQ 2008 by bringing in the underground earlier.
  • White Mountain in Jilin Province is showing signs that it could become SGX’s next gold mine, with a fairly consistent width of about 20m at grades >4g/t (two intersections in JQ 2005 were 20.4m @ 8.2g/t and 21.2m @ 5.8g/t) extending over at least 1.1km (and still open on strike and at depth). Should it be capable of achieving production rates of ~150,000ozpa, then Sino Gold may be able to achieve its target of 500,000ozpa of production as soon as 2008.
  • The construction of Jinfeng has started in earnest and already the bulk earthworks are 75% complete. In doing so, the orebody has been exposed and with it a number of ore zones and splays that were not in the original model, inferring that the strip ratio may be lower than the expected average of 13 to 1, which should reduce costs and result in additional mill feed.
  • SGX’s experience in achieving MLs at both Jinfeng and Zhangjiashan within one year of the EL being granted implies that the White Mountain ML may be achieved within one year (since it already has its EL), and hence White Mountain could be in production by 2008, especially since it appears to be free milling (not refractory). Sino Gold are aiming to delineate a 1moz resource and conduct feasibility studies at White Mountain by 2006, possibly develop in 2007 and start production in 2008.
  • SGX has an extensive exploration programme at Jinfeng and its surrounding region in Guizhou Province. Aside from the deep drilling already extending the main Jinfeng orebody 120m deeper, there are numerous drill-ready targets within a total area exceeding 530sq km mainly covering parts of southern Guizhou.

Dec 2006 - Sino Gold Limited

Sino Gold Limited (SGX)

  • The Jinfeng plant is HUGE, SGX appear to have a ~US$250m plant at the cost of ~US$90m to US$95m.
  • Initial grades are higher than we expected at Jinfeng with the first bench showing a clump of ~14g/t values, and inferred higher reconciliations, resulting in expected initial Year 1 open-cut grades ~20% higher at 6 to 7g/t.
  • Just how much gold Jinfeng can produce annually is open to debate. Rated as 180,000ozpa based on 1.2mtpa, peak production appears to have the potential to be ~300,000ozpa to 400,000ozpa or so. (It was not surprising post the visit that Gold Fields established a new 50/50 JV with SGX targeting potential 5moz orebodies with 500,000ozpa production, & increased their holding in SGX to 17.4%).
  • This comment was written following an analysts’ trip to Jinfeng ahead of the China Mining Conference in Beijing in November 2006, at which SGX received the Mine Development of the Year Award for the Jinfeng Gold Project. The trip highlighted the size of the Jinfeng plant, its potential capacity, early indications of higher grades than expected and included a presentation on SGX’s exploration activities in China.
  • The Ausenco (AAX) built Jinfeng plant as shown in Figures 1a and 1b is HUGE with the main section about 0.5km long and the whole plant at least 800m long. It looks like it should easily achieve the usual 20% (for Australian built plants) above rated capacity, and that is before the 50% expansion. (The 20% above normal usually results from the fact that a 15% design contingency is built into the size components in Australian plants, however a 25% design contingency has been used at Jinfeng (based on accepted practice in the Asian region)). While the 50% expansion (at a possible cost of US$15m from cashflow) appears likely to occur, numerous variations are to be tried first to see what the plant can achieve before it is expanded.

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