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Brilliant day dawns for Citigold

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Gold miner inks MOU with Chinese company to develop City mines

Citigold Corporation has signed a non-binding memorandum of understanding with China's Henan Jinqu Gold Company to form a joint venture company to develop the City mines of Citigold’s Charters Towers gold project in North Queensland.

The high-grade deposit is Australia's richest major goldfield and contains a gold resource of 10 million ounces (23 million tonnes @ 14 grams per tonne) with exceptional growth potential.

Under the terms of the MOU, Jinqu may acquire up to a 50 per cent interest in the joint venture company, which will own granted mining leases with permits to mine and associated infrastructure, containing a gold mineral resource of 1.8 million ounces.

A member of the Shanghai Gold Exchange, Henan Jinqu Gold Company’s main business is the exploration, mining, processing and smeltering of gold. The company is also engaged in research, development, production and sales of synthetic diamonds.

The City mining area is where Citigold carried out the initial exploration in the 1990s after acquiring the first part of the Charters Towers goldfield.

Full control of the goldfield was obtained in 2004.

Citigold’s Gold production plan for the design and development work has been undertaken with the aim of producing 200,000 ounces per annum from the City mines. The City includes the major Sunburst, Brilliant and Day Dawn reefs to be developed together as one "super" mine.

Citigold has indicated that the development of the City operations should take 24 months and cost up to $70 million. The development of the City is to be separate from the Warrior mine and the existing 340,000 tonne capacity gold processing plant.