China National Gold Group has agreed to acquire 82% interest in the Jinfeng gold mine in China's southern Guizhou province from Eldorado Gold for $300m.

gold mine

The open-pit and underground mine, which uses Biox technology and a conventional carbon in leach circuit to produce gold doré, is expected to process 930,000t of ore at a grade of 3.89g per ton gold in 2016.

Subject to obtaining various regulatory and other approvals, the transaction is planned to be completed in the third quarter 2016.

Eldorado Gold president and CEO Paul Wright said: "China National Gold has been our minority partner at Jinfeng for over fourteen years and is the logical buyer as the operation transitions fully into the underground.

"Since commencement of production in 2007, Jinfeng has consistently delivered solid operating results and has been a strong contributor in Eldorado’s global portfolio."

Eldorado said that it will continue to evaluate the merits of potentially monetizing its Chinese assets.

The firm will source the ore from the underground operations and a small amount of stockpile, as the open pit operations at the mine were concluded in April 2015.

Underground ore mining at Jinfeng is planned to increase to 1.2 million tons of ore per year, bringing the production back to above 130,000oz of gold per year.

Image: The open-pit Jinfeng mine located in China’s southern Guizhou province. Photo: courtesy of ldorado Gold Corp.