NationsGold (03939): The development path of the Gold Ridge gold mine is revealed, opening up the explosive period of value of core assets.

On November 17th, Zijin Mining Group, a strategic shareholder of Zhaojin Mining (03939), announced the latest information on the gold resources and development progress at the Jinling Gold Mine, triggering significant market attention with two core positive factors. Zijin Mining Group has completed the feasibility study of the Jinling Gold Mine expansion project, with the 10 million tons per year expansion plan officially confirmed, enhancing the certainty of project advancement. Through professional exploration by Zijin, the gold reserves in the mine have increased from 7.34 million ounces (equivalent to 228 tons) announced at the end of 2024 to 367 tons, a staggering 61% increase. The double positive factors not only confirm the world-class resource endowment of the Jinling Gold Mine, but also signify its transition from resource reserves to capacity release entering an accelerated phase. The significant increase in resources adds another heavy weight to the value foundation. The announcement reveals that the core highlight of the disclosure is the increase in gold resources at the Jinling Gold Mine. Data shows that within the mining area, there are approximately 2.894 billion tons of ore with 367.104 tons of Au metal; within the boundary, there are approximately 2.493 billion tons of ore with 328.593 tons of Au metal. Based solely on the metal content within the boundary, compared to the 228 tons of gold resources at the end of 2024, Zijin Mining Group, with its industry-leading exploration technology and experience in metallogenic belt research, has updated the gold resource quantity to 328 tons with an average grade at a high level of 1.32 grams per ton. This increase is equivalent to adding over 100 tons of developable gold resources to the company, and calculated based on the current average industry mining cost and gold price levels, the potential value of the added resources exceeds 30 billion yuan. As a quality asset in the Pacific mineralization belt, the resource endowment advantage of the Jinling Gold Mine has been further strengthened. This increase in resource quantity is not based on peripheral exploration expansion, but is based on refined exploration in the deep parts and surrounding areas of the original mining area, confirming the geological characteristics of "deep extension and concentrated reserves" of the ore deposit. The announcement specifically mentions that in the new resources, the percentage of confirmed and controlled type resources is 46.7%, with low ore processing difficulty, and the overall recovery rate of the new and old ore processing plants is close to 80%, providing a solid guarantee for future large-scale development. With the Zijin plan in place, the project's advancement certainty is at its peak. This announcement has laid out a clear path for the expansion of the Jinling Gold Mine, becoming a key factor in eliminating market doubts. The announcement clarifies that the expansion project will add over 10 million tons per year of ore processing capacity, with a total mining and processing scale reaching 13.5 million tons per year. The design will utilize 277.57 tons of gold resources (see figure below). During the project expansion period, the mining cost is $4.2 per ton of ore, and the stripping cost is $3.72 per ton of rock; after the open-pit mining scale reaches 13 million tons per year, the mining cost can be reduced to $2.19 per ton of ore, and the stripping cost to $2.08 per ton of rock. This means that costs will be significantly reduced after production on a large scale. After the project reaches production, the annual gold production may increase from 2.06 tons in 2024 to 15 tons (higher than the previous estimate of 12 tons), with an increase of 628%, surpassing market expectations. Combined with the company's net profit attributable to shareholders of 600 million yuan in the first half of 2025, a year-on-year increase of 136% in profit performance, it is expected that institutions will raise their growth expectations following the announcement. In summary, the core significance of this announcement lies in the substantial breakthrough in resource quantity and the clear implementation of the development plan, completely eliminating market concerns about the uncertainty of project advancement. With Zijin Mining Group's continuous empowerment in terms of funding, technology, and management, the Jinling Gold Mine is transitioning from a "growth-type asset" to a "world-class profit engine," and Zhaojin Mining is expected to fully enjoy the dual benefits of resource appreciation and capacity release in the gold industry's prosperity cycle.