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China Regulator Probes Zijin Mining For Possible Breach Of Rules
Jul 20,2010 13:13CST
industry news

HONG KONG, Jul 20, 2010 (Dow Jones Commodities News Select via Comtex) -- Zijin Mining Group Co. (2899.HK), China's biggest gold producer by capacity, said Monday it is under investigation by China's securities regulator for a possible breach of disclosure rules after it took more than a week to report a major toxic chemical leak at its Fujian copper plant.

On July 12, the company issued a statement saying a rapid rise in underground water level damaged the waterproofing layer at the base of Zijinshan Copper Mine's wastewater containment pool. The statement came nine days after the leakage started to contaminate a reservoir and the nearby Ting River on July 3.

Hong Kong- and Shanghai-listed Zijin said in a statement it will fully cooperate with the China Securities Regulatory Commission, and will disclose information required by the regulator.

In a separate statement Monday, the miner expressed "deep regret regarding the incident and the improper handling of information disclosure," which resulted in substantial losses to fish farmers with operations at a downstream reservoir.

The company said last week that three executives at the Zijinshan plant, including the head and deputy head of the plant, were detained by authorities. Operations at the plant have been suspended since the leak occurred, but the miner didn't disclose when operations could resume.

Zijin said Monday it was "overconfident" and had a lack of crisis awareness during the course the company's rapid expansion. Zijin said it will look into environmental safety across the company as well as set up an emergency relief team to improve its emergency response system.

In addition, Zijin also said it will properly handle compensation for damages, though it didn't provide any estimate for compensation and the potential losses to the company. The copper plant accounts for around 13% of Zijin's copper production.


copper Cu
Zijin Mining Group

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