Metals Economics Group Reported in 2007 that discovered deposits of more than 2,5 million ounces, enough to attract the interest of major gold producers, were not adequate to replace their production. To make the discrepancy worse, only 52% of the discovered resources had been upgraded to reserves. They expect an average increase in mined gold production of about 3% annually from 2007 to 2010.
Gold Fields is the single largest shareholder in Sino Gold. The SGF Alliance was established with the aim of discovering large gold deposits in China containing reserves of at least 5,000,000 gold-equivalent ounces with the potential to produce approximately 500,000 ounces per annum, exploring primarily for large bulk-mineable styles of gold and/or gold-copper mineralisation.
During 2007, the SGF Alliance undertook a thorough analysis and ranking of 58 mineral belts in China. Four mineral belts were selected as priority belts for the SGF Alliance to explore.
The property to be explored by the SGF Alliance is the Bengge Exploration Licence, which is located in the Pulang Belt in Yunnan Province. The SGF Alliance will acquire an initial 20% from Kunming Jinsanjiang Mineral Products Company and has the right to acquire up to 97% upon meeting agreed expenditure milestones.
A number of porphyry copper-gold deposits are known within the same belt in Yunnan Province, most notably the world-class Pulang copper-gold deposit. The Bengge property is located approximately 40km south-southeast of Pulang and approximately 400km northwest of Kunming, the provincial capital.
Bengge contains known porphyry gold-copper mineralisation which is hosted in sheeted arrays of parallel, low-sulphide, narrow quartz veins in several syenite intrusions.
Exploration aims to delineate a large deposit amenable to bulk, open-pit mining. Geological mapping, surface sampling, trenching and aditing have been undertaken at Bengge but not drilling.
Drilling at Bengge is intended to commence in mid-2008 following an initial exploration program to define drill targets and receipt of requisite approvals from the relevant Chinese authorities. -- www.cnxmarketlink.com