Zijin Mining Reports Waste Leakage in China

China’s biggest gold producer is responsible for a major acid waste water leak in Fujian Province. From the Wall Street Journal:

Zijin Mining Group Co., China’s biggest gold producer, said Monday it suspended operations at one of its copper plants in eastern China after acidic waste water leaked from the plant following continuous heavy rainfall and killed tons of fish in the nearby Ting River.

Shares of Zijin Mining, which were suspended Monday, fell as much as 8.4% after resuming trading Tuesday. Late morning, the shares were down 8.1%.

The sewage leakage from the Zijinshan Copper Mine underscores the challenge China faces in enforcing tougher measures against pollution and comes after China’s Ministry of Environmental Protection said in May that seven companies owned by Zijin Mining, including Zijinshan, must make modifications to meet the government’s higher environmental standards in its battle against pollution.

See also a report from Bloomberg:

Zijin will likely have to pay a penalty, and compensation for local fisheries may reach about 5 million yuan ($738,000), Zhao said. The government had asked the company to pay villagers 3 yuan for each kilogram of dead fish, he said. Zhao said the number of fishes affected were still been counted.

“We estimate for each month of production disruption, Zijin’s FY10 copper output would be affected by 1.7 percent and earnings to be affected by 0.9 percent,” Trina Chen, an analyst at Credit Suisse Group AG, wrote in a note today.

The Shanghang county government mobilized soldiers, civil servants and villagers to help net the dead fish, Xinhua said yesterday. Calls to the Shanhang county government communications office were not answered.

July 13, 2010 1:01 PM
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