VANCOUVER, April 30, 2014 /PRNewswire/ - China Gold International Resources Co. Ltd. (TSX:CGG; HKEx: 2099) ("China Gold International Resources" or the "Company") provides an update on first quarter of 2014 ("Q1" or "Q1 2014") production and operations at its Jiama Copper-Gold Polymetallic Mine in Tibet Autonomous Region of the People's Republic of China ("Jiama Mine", or "Jiama").
Power Supply at Jiama:
As previously announced the Company's Jiama Mine experienced reduced power supply during Q1 2014. Consequently, Jiama Mine's copper and other metals output during Q1 2014 was severely reduced. Jiama's 6,000 tpd Phase I processing plant was closed for most of Q1. The stripping work for Phase II expansion has not been affected. The Company mitigated the effect of those disruptions by scheduling equipment maintenance and time off for employees during that time.
On March 31, 2014, with the assistance from the local government, local power supplier in the Tibet Region and through the use of locally generated thermal power, adequate power supply has been re-established. Subsequently, production reached full 6,000 tpd capacity level of Phase I in the month of April 2014. The Company was able to achieve record copper production levels in April 2014.The Company expects that its power costs will be higher than previously paid until a permanent power supply solution is established. Further negotiations are on-going with the local government and local power provider to ensure reliability, availability and acceptable price of the electricity supply in the medium and long-term. Q1 2014 and Full Year 2014 Production and Operating Outlook for Jiama: As a result of the power shortages, the Company anticipates reporting significant decline of production, revenues and net profit at the Jiama Mine during the first quarter of 2014. The Company will announce its first quarter 2014 results on May 15, 2014. Local government of the Tibet Autonomous Region and the Central Government of China are currently progressing a power supply development plan including new hydro power station development plan to solve the problem of seasonal power shortage in the Tibet Region. At this time, the construction of Phase II expansion is not expected to be significantly affected by the power shortage and is expected to be completed on time. Once the Company is satisfied with the medium and long-term arrangements for power supply, the Company expects to launch operations of stage one of its Phase II expansion for the Jiama Mine. The Company expects that its ongoing initiatives to increase production, productivity and efficiency at the Jiama Mine will enable it to meet its previously expected 2014 production guidance of approximately 50 million pounds of copper. However, due to uncertain nature of those initiatives, the Company will need to confirm its 2014 guidance for the Jiama Mine in mid-2014.