Vancouver — Jinshan Gold Mines (JIN-T, JINFF-O) has started commercial production at its Chang Shan Hao (CSH 217) open-pit gold mine in the Inner Mongolia region of northern China.
The first 500-oz. gold dor bar has been poured at the mine; Jinshan expects to produce 120,000 oz. gold per year once operations are ramped up over the next few months. Heap leaching began last month.
“We now have a proven development track record to support our growth strategy in Asia,” says Jinshan president Jay Chmelauskas.
Capital costs to build the mine came in at about US$31.2 million.
Operations will focus on recoverable proven and probable reserves of 66.7 million tonnes grading 0.75 gram gold per tonne in the Northeast zone of the open-pit model. An engineering study estimated the waste-to-ore strip ratio at 1.07:1 over the mine’s initial 9-year lifespan.
The mine plan sees a heap-leach processing rate of 20,000 tonnes per day with run-of-mine ore being delivered to the leach pad in the first two years. A 3-stage crushing plant, to be built in year two, will process the mainly sulphide ore from year three onwards.
Average cash costs of about US$253 per oz. gold are projected over the 9-year operating plan.
Jinshan recently began a study to boost the mine’s output to 180,000 oz. gold annually. The study will look to incorporate the Southwest zone’s measured and indicated resource of about 32 million tonnes at 0.86 gram gold into the mining plan.
Jinshan owns 96.5% of the mine’s operating company, Ningxia Pacific Mining, with the remainder held by Brigade 217 of the Northwest Geological Bureau.
The new gold producer is also exploring its Dadiangou gold project, in central China’s Gansu province.
Ivanhoe Mines (IVN-T, IVN-N) owns about 43% of Jinshan’s shares.
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