DONG MAO HUO MINING AGREEMENT
May 05 2009 - 2:00AM
UK Regulatory
TIDMGGG
Central China Goldfields plc
("GGG" or "the Company")
DONG MAO HUO GOLD MINE
CONTRACT MINING DEAL SIGNED WITH CITIC-ANHUA
LONDON - 5th May 2009
Central China Goldfields plc (AIM: GGG) is pleased to announce that the Company
has signed a contract mining agreement with Beijing based, CITIC Anhua's
subsidiary Jiuquan Zhongan Mining Co. Ltd in respect of the Dong Mao Huo gold
mine in Northern China.
CITIC Anhua Group is the mining arm of the CITIC Group which is a large Chinese
Government Investment Company. CITIC Anhua currently operates three gold mines
and has several exploration properties in China.
Key points of the Agreement are:
* CITIC Anhua will build a 500 tonnes per day mining and processing plant.
* Construction to start as soon as possible and mining to start by September
2009.
* CITIC Anhua will fund all the capital expenditure and operating costs.
* Central China Goldfields will receive a fixed RMB 1.5 million per annum
during the initial oxide phase of the mining.
* Central China Goldfields will then receive 30% of the net profits from the
key sulphide mining phase.
* In addition CITIC Anhua will pay Central China Goldfields plc RMB 250,000
per annum for the first six years to recover historic expenditures.
Jeff Malaihollo, Managing Director of Central China Goldfields plc, comments:
"We are pleased to welcome CITIC Anhua subsidiary Jiuquan Zhongan as our
partner at the Dong Mao Huo gold project and we look forward to a long-lasting
and profitable relationship.
The contract will enable Central China Goldfields to quickly put this near
surface gold project into production and will enable the company to recover its
investment in the project whilst fully participating in the upside of the more
important gold sulphide element of the project where the high grade gold pods
are to be found.
Dong Mau Huo is the first project which Central China has taken from
exploration acquisition to the planned production phase and we believe this
demonstrates that the company has the skills and staff necessary to manage the
full exploration to production cycle and yet retain its exploration focus.
Central China Goldfields will now focus the bulk of its human and technical
resources on to its Nimu copper project situated in Western China. This project
like Dong Mao Huo is being developed with the aim of bringing in a major joint
venture mining partner at the appropriate time who would fund the projects
substantial capital requirements."
For Further Information:
Central China Goldfields plc Hanson Westhouse Limited
Dr. Jeffrey Malaihollo Tim Metcalfe / Martin Davison
Tel: 020 7621 0200 Tel: 020 7601 6100
Email: info@ccgoldfields.com
www.ccgoldfields.com Alexander David Securities
Limited
Nick Bealer / David Scott
Tel: 020 7448 9820
END
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