Consolidation Likely for Gold Mining Companies in China's Gansu Province

Online, February 5, 2010 (Newswire.com) - For years, China's Gansu Province lagged behind other Chinese economic powerhouses such as Anhui Province, the home of Beijing. But in the past ten years, Gansu has exploded when mineral resources such as gold were discovered to be abundant in the area.

In the past five years, many small, privately owned Chinese gold mining companies, such as Jinshan Gold mines and China Mineral Company, have popped up in the Gansu hills. These companies have been remarkably successful discovering quantities of gold that exceeded the predictions of geologists in the area.

In June of 2008, China's mining giants took notice and began bidding for a huge gold mine in the Wenxian County of Gansu Province. However, there are a few smaller companies operating closer to Yashan in Wen County who have remained autonomous, for the time being. Several major Chinese mining companies have turned an eye to the region, and analysts believe that they hope to consolidate the small companies to take full advantage of the recent discovery that the region may have hundreds of tons of the precious metal waiting to be brought to the surface.