Industry News

On October 27, the Bureau of Geology and Mines of Henan Province was informed that the Bureau had made a major breakthrough in the area of Weishancheng, Zhuzhuang Town, Tongbai County, and discovered a very large gold mine. A total of 16 gold ore bodies were found, with a preliminary estimate of 31.55 tons of gold reserves, which is a very large gold mine; it is expected to exceed 50 tons by the end of this year, which is another major achievement of gold exploration in Henan Province in the past three years. For decades, Henan has steadily ranked second in annual gold production. (Shandong Province is in first place.) In 2016, the Department of Land and Resources of Henan Province had discovered very large gold deposits containing about 105 tonnes of gold, which could be mined for 80 years, in the deep and peripheral census project of Laowan gold mine in Tongbai County, within the Tongbai Mountain region of Henan Province.

So will the discovery of very large gold mines have an impact on gold prices?

Industry analysts believe that the discovery of large gold mines will have a limited impact on gold prices due to a number of reasons, including the fact that it will take a long time from the discovery of gold mines to be converted into production. Gold analysts interviewed by Xinjing said that, in general, only about a third or so of discovered gold mines can be upgraded to gold resource reserves. "The amount of gold that can actually be produced is very small given the environmental and production technology issues that many gold mines have faced in recent years."

At the same time gold, as an important strategic resource, is a special commodity and production does not have a great impact on the price of gold, which is more determined by the international gold price and the global demand for gold, especially from large consuming countries such as China and India. The discovery of gold mines is more at the level of strategic reserves, so it basically does not cause fluctuations in the price of gold.