Hunan Gold Co., Ltd.(hereinafter referred to as "Hunan Gold", 002155.SZ), a subsidiary of Hunan Gold Group, a state-owned enterprise in Hunan Province, recently announced that its subsidiary Hunan Xinlong Mining Co., Ltd.(hereinafter referred to as "Xinlong Mining") temporarily suspended production due to an accident that killed an employee.
Hunan Gold's announcement mentioned that on July 17, employees of the project department of Hunan Jinzhiyuan Mining Engineering Co., Ltd.(hereinafter referred to as "Jinzhiyuan"), the mining project contractor of subsidiary Xinlong Mining, were at Xinlong Mining 800 Pit. During the pneumatic drilling operation, the roof fell, and the accident caused the death of an employee of Jinzhiyuan's Xinlong Mining Project Department.
The announcement stated that after the accident, Xinlong Mining immediately launched an emergency plan. The company's leaders immediately rushed to the scene to organize handling, and took emergency response measures to carry out personnel treatment and aftermath work. Xinlong Mining promptly reported the accident to relevant departments in accordance with relevant regulations and procedures., and took the initiative to suspend production for rectification.
At present, Xinlong Mining and Jinzhiyuan Project Departments are actively cooperating with local emergency departments to further investigate and handle the accident, and various disposal work is being carried out in an orderly manner.
Regarding the expected possible impact, Hunan Gold stated that according to the "Production Safety Management Agreement for Non-Coal Mine Outsourcing Projects" signed by Xinlong Mining and Jin Zhiyuan, after the accident investigation is closed, both parties will assume their respective responsibilities based on the accident investigation and handling conclusions. The accident was ultimately subject to the accident responsibility determination of the government emergency management department. In addition, in view of the ongoing accident investigation, the resumption of production of Xinlong Mining's headquarters is not yet certain, which is expected to have a certain impact on the company's production and operations.
It is worth noting that this is the second production accident disclosed by Hunan Gold in less than four months, and both resulted in employee deaths. The accidents also occurred while Jin Zhiyuan, the outsourcing party of subsidiary Xinlong Mining, was operating.
Previously, on March 28, Hunan Gold disclosed that its subsidiary Xinlong Mining headquarters temporarily suspended production due to a production safety accident in the subsidiary. On March 27, employees of the Jinzhiyuan Project Department, the mining project contractor of Xinlong Mining, were moving anchor nets at the entrance of the warehouse of 630 Industrial Plaza on the ground of Xinlong Mining. An object hit occurred due to the rolling of the piled anchor nets, which caused the accident. An employee of the Jinzhiyuan Xinlong Mining Project Department died.
On June 6, more than two months after the accident occurred, Hunan Gold disclosed that on June 6, Xinlong Mining received the "Notice on Agree to Hunan Xinlong Mining Co., Ltd. to Official Resumption of Work and Production" from the Xinshao County Emergency Management Bureau (Xin Emergency [2024] No. 19), agreeing to the formal resumption of work and production from June 6, 2024.
According to preliminary calculations by the company's assets and finance department, the last shutdown of Xinlong Mining headquarters is expected to reduce Hunan Gold's current net profit by approximately 31 million yuan.
Hunan Gold stated that after the production was suspended, Xinlong Mining actively carried out safety education and training for all employees, investigation and rectification of potential safety hazards, and equipment maintenance. The company will deeply learn from this incident, further increase production safety inspections and supervision of subsidiaries and contractors, strengthen employee safety education and training, and effectively implement production safety responsibilities.
However, just over a month after the resumption of production, another production accident occurred in the same company and caused employee deaths.
Hunan Gold was formerly the Xiangxi Gold Mine in Hunan Province. It is mainly engaged in the mining and mineral processing of gold, antimony, tungsten and other non-ferrous metal mines, the smelting and processing of non-ferrous metals such as gold, antimony and tungsten, the deep processing of gold and refined antimony, and the import and export of non-ferrous metal mineral products. The company is one of the top ten gold-producing companies in the country, a global leading enterprise in antimony ore development, and an important domestic tungsten ore enterprise.
According to the 2023 annual report disclosed by Hunan Gold, the company's revenue last year was 23.303 billion yuan, an increase of 10.75% compared with the same period last year (year-on-year); net profit attributable to shareholders of listed companies was 489 million yuan, a year-on-year increase of 11.20%. The latest disclosed semi-annual results forecast for 2024 shows that the company's net profit attributable to shareholders of listed companies in the first half of this year is expected to be 391 million yuan-447 million yuan, an increase of 40%-60% compared with the same period last year; the increase in performance during the reporting period was mainly due to the increase in product prices.
It is worth mentioning that against the background of the overall rising gold price this year, Hunan Gold disclosed in May this year that it will invest in the construction of the mineral resource utilization project of the Yidi South Kuangqu Mining Area in Jiaxin, Gansu. The planned investment of the project will not exceed 588.158 million yuan. Hunan Gold acquired Gansu Jiaxin in 2009. The latter is currently one of the company's important gold resource bases. The project's mining and dressing design scale is 500,000 tons/year, and the product is gold concentrate, which will enhance Hunan Gold's gold product production scale.
Xinlong Mining is one of Hunan Gold's three secondary subsidiaries. It was established on February 18, 2004 with a registered capital of RMB 300 million. It was transformed from the original Longshan Gold-Antimony Mine in Hunan Province. The mine has a mining history of more than 100 years, and its main products are gold and antimony. The company is located in Taizhimiao Township, Xinshao County, Shaoyang City, Hunan Province. It is one of the key enterprises in Shaoyang City and a leading enterprise in Xinshao County's economy.
In 2023, Xinlong Mining Headquarters will produce 801 kilograms of gold and 6060 tons of antimony. As of December 31, 2023, the total assets of Xinlong Mining Headquarters were 947.9421 million yuan and the net assets were 776.9724 million yuan; in 2023, it achieved operating income of 477.527 million yuan and net profit of 40.5568 million yuan.
It should be noted that for mining companies, safety and environmental protection are the two important bottom lines of the company. The official website shows that on December 19, 2023, Chen Wei, Secretary of the Party Committee and Chairman of Xinlong Mining, put forward three requirements for work in 2024 at the company's meeting, among which safety must be the bottom line. Effectively implement the compact production safety responsibility system, resolutely prevent and contain the occurrence of production safety accidents, and ensure the realization of "odd jobs" in production safety,"zero incidents" in environmental protection, and "zero new additions" in occupational diseases.
Jin Zhiyuan's official website shows that the company is a national mining engineering construction general contracting enterprise with a registered capital of 26 million yuan, more than 300 employees, and more than 300 sets (sets) of various machinery and equipment. The company currently has 8 project departments under its jurisdiction, and the annual production capacity of each project department has reached a good level of the same type of project department. The company was established in 2007 and was formerly known as the Xiang 'an Tungsten Industry Project Department of Huaihua Tunnel Engineering Co., Ltd. established in 1998. In December 2013,"Anhua Jinzhiyuan Mining Engineering Co., Ltd." was renamed "Hunan Jinzhiyuan Mining Engineering Co., Ltd.".
Jin Zhiyuan's business scope includes: tunnel engineering, mining engineering, open-pit mining engineering, tailings engineering, mineral processing engineering, professional construction of anti-patio, auxiliary ancillary engineering and supporting engineering for mining, dressing and production. At present, the company is mainly engaged in non-coal mine tunnel engineering construction, ore mining and other businesses.