With a new beginning comes a fresh start. As the year of 2022 is ringing in, we see both hope and challenges lying ahead. On behalf of Zijin Mining Group, I wish a Happy New Year to all our stakeholders in China and around the world. I would also like to extend our sincere gratitude to our employees and their families, our investors, local communities and governments where we operate, for their devotion and support that have made us grow.
Zijin Mining unveiled its Five-Year (2+3) Plan and 2030 Development Goals at the start of 2021, aiming to become a top global metals and mining company with a three-phased approach in 10 years.
As an old Chinese saying goes, first victory is most auspicious. Zijin Mining secured a good start in 2021. Faced with momentous changes and a global pandemic unseen in a century, Zijin Mining followed the overarching principle of “deepening reform, leapfrog growth, sustainable development” in calmness and confidence, and achieved better-than-expected results in financial and operational performance as well as the construction of major projects.
This past year is a year of leapfrog growth. Despite external difficulties, Zijin Mining has created new production records to maximize the sales and profits in a bullish metals market. Our overseas operations have contributed more than our domestic operations and our copper assets have become a main driver of our growth, turning us into a top player in the global copper market. Self-driven innovation and strengthened competitiveness are key to our progress – Zijin Mining has been ranked by both Forbes and the Fortune magazine as one of world’s top 500 companies.
This past year is a year of a solid foundation for sustainable development. The construction of several “flagship projects” has made great headway, another testimony to the “Zijin Capability” and “Zijin Speed”. The three world-class copper projects - the Kamoa-Kakula copper mine Phase 1 in Democratic Republic of Congo, the Upper Zone of the ?ukaru Peki copper-gold mine in Serbia, and the Julong copper mine Phase 1 in Tibet - have started commercial production. The expansion project of tens of millions tonnes per annum capacity at Serbia Zijin Copper’s Majdanpek mine has been completed and put into operation. And we expect to see the Kamoa-Kakula Phase 2 and 40Ktpd concentrator at the Veliki Krivelj mine to be commissioned in the first half of 2022. Other construction or expansion projects including the Binduli gold mine in Norton of Australia, the Buriticá gold mine in Columbia, Shanxi Zijin, Guizhou Zijin, JV Zeravshan in Tajikistan and its smelter project are also progressing steadily. Our “Five-in-One” mining and operational model has been applied to more mines with exciting feedbacks.
This past year is a year of deepening reform and pursing green ambitions. With a global perspective in mind, the Group initiated managerial reforms to build a streamlined, standardized, and more efficient organizational process. To install an overall ESG system has been regarded as top priority. Achievements have been made in the development of an international management and operation system and in building an internationally competent workforce.
Our mines are becoming greener and more eco-friendly, with power consumption and carbon emissions per unit of output dropping. Low carbon emission target is a top requirement for all of our constructions and operations.
The Group has decided to expand into the renewable energy and advanced materials industry starting from exploring the upstream mineral resources. We are about to complete the deal to acquire the 3Q project, a world-class, high grade lithium brine project in Argentina with RMB 5 billion. Our lithium iron phosphate project, electrodeposited copper foil project and high-performance alloys project are progressing rapidly. We have launched a project together with Fuzhou University to commercialize the ammonia-to-hydrogen energy solution. And we installed solar power generators at our mine sites and factories that turned out to be a brilliant idea.
This past year is a year of celebrating excellent corporate culture. Hundreds of employees braved the COVID-19 pandemic to fill overseas positions, and others dedicated themselves to their responsibilities for years without any complaints. Our team at Julong Copper overcame some extreme challenges including coldness and low oxygen levels so that the largest copper mine in China can be put into operation after an unbelievable one-year-and-a-half period of construction. This is a “Zijin miracle” performed at the highest altitude ever.
The motto of “working hard and breaking new ground” guides our work in every “Belt and Road” country that we operate in. Through a Zijin-specific approach to “common development”, we have benefited many in China and overseas. Zijin Zinc won the title of “National Outstanding Entity in Poverty Alleviation”, and many overseas projects were praised by local authorities and communities, enhancing Zijin Mining’s reputation as a responsible multinational company.
Time favors those who forge ahead. History will remember those with a striving spirit.
With the pandemic raging, and major, evolving changes unseen in a century unfolding, the external environment becomes more challenging. To control global warming and to reduce GHG emissions have become global awareness while China is moving faster to fulfill its commitments of carbon peaking in 2030 and carbon neutrality in 2060. Energy transition and electrification have gained strong momentum, creating a Blue Ocean market with unlimited potentials. Copper as a critical mineral has been strategically repositioned and substantial demand upside is woven into the future together with other battery metals such as lithium, cobalt, and nickel. Gold is still considered to be a safe haven so it will stay in the high trading range as liquidity floods everywhere.
2022 will mark the first milestone in our endeavor to turn our ten-year development plan into reality. Zijin will stay committed to the general principle of “deepening reform, leapfrog growth, sustainable development” while enhancing its global competitiveness. We supply the world with high-quality mineral products and energy-transition metals for stronger economic growth as well as a sustainable future.
Deepen reform and establish a global operation and management system.
Zijin is building a streamlined, standardized, and more efficient organizational process with a three-phased approach in 10 years. The first phase of deepening reform has entered “deep waters”, where the “hard nuts” must be cracked. To this end, we will find the “middle way” between international standards and our own business model. We will introduce international corporate policies and empower production teams with smarter and better digital tools. We will also develop a tailor-made talent pool to support our development and also to stimulate organizational vitality.
A major shift in the energy mix is underway, driven by the policy of “carbon peaking and carbon neutrality”. We will follow the industry trends and set our own goals in controlling energy consumption and carbon emissions to realize green and sustainable development. We will change the traditional “mining mindset”, and seize market opportunities to acquire related mineral resources and diversify our business portfolio to become a leader in the renewable energy and advanced materials industry.
Reforms will be conducted to bolster our capabilities in integrating mining, finance and trading. We will work closely with capital markets to make breakthroughs in acquiring major projects, strategic resources and industrial capacities in China and overseas.
To install an overall ESG system with Zijin characteristics, we will follow international standards and norms, and improve our performance in environmental protection, OHS, human rights protection, anti-corruption and supervision, responsible supply chain, and social contribution. We aim to set the global benchmark in recycling, management, and online monitoring of water at mines and in ecological restoration.
We will improve our licensing work in all areas, to ensure compliance with laws and regulations. Meanwhile, stronger measures will be taken on ecological conservation and natural carbon sinks. We will build solar, wind and hydro power generators at our mines to speed up the shift from oil to electricity and electrification. We will invest more in clean energy, and build green mines to international standards. Putting high emphasis on safety and environmental protection, we keep improving our safety indicators and safety processes.
Achieve leapfrog growth by turning mineral resources into mineral products and sales revenues.
The bullish sentiments for metals and commodities will not fade away in 2022 and this is another year that will witness our strong growth as many of our world-class projects will be put into operation. Time is our friend, so we must “earn the money we ought to earn”, and strive for higher-than-expected, leapfrog growth.
Copper projects are the main driving force for the Group’s “leapfrog growth”. Mature copper mines must maintain stable production and push for even higher outputs. New projects must speed up their construction so that they can be commissioned and reach nameplate capacity as soon as possible.
We will advance the construction of Kamoa-Kakula copper mine Phase 2 and the smelter project, and fast track Kamoa-Kakula Phase 3, the Lower Zone of the ?ukaru Peki gold-copper mine in Serbia and Phase 2 of Julong Copper in Tibet. We will also push forward with technical upgrades and expansion projects at Serbia Zijin Copper, Heilongjiang Tongshan copper mine and other projects.
The potential of our gold projects will be further unlocked. We will accelerate technical upgrading or ramp up production at our key gold assets including the Buriticá Gold Mine in Colombia, the Aurora Gold Mine in Guyana, and Norton Goldfield in Australia. We will push for the restart of the Porgera Gold Mine, the commencement of production at the porphyry gold mine of Shanxi Zijin and that of the technical upgrading at Guizhou Zijin.
We aim to beat our production targets for zinc to take advantage of the current bullish cycle.
Substantive breakthroughs will be made to expand our renewable energy portfolio. We will ensure the completion of the 3Q lithium deal, kick off engineering and construction, and begin commercial production as early as possible. We will work towards major breakthroughs in lithium extraction technology, and start the construction of new capacities. And we will seek opportunities in the field of hard-rock lithium. Our goal is to become an important global supplier of lithium materials.
To give a further boost to our leapfrog growth, we will tap into mining-related industries, and forge greater synergy among our businesses of smelting, processing, construction, logistics, technologies, finance, and trading.
Enhance global competitiveness across the board through sustainable development.
Zijin Mining will look up the global mining pool for strategic, medium-sized and large M&A deals. The Zijinshan Mine and other key mines will launch new rounds of prospecting, with more in-house exploration expertise to secure new breakthroughs.
The Group will create synergy between mining and other related industries, and enter the field of “urban mining” and circular economy. We will drive improvements in production and operation with technological innovation. We will further develop our in-house, integrated expertise in mining technology and engineering, and in research, design, and implementation. We will break new ground in block caving, lithium extraction, ammonia-to-hydrogen energy solutions, clean energy, smart technology and information technology.
Zijin Mining will pursue high-quality development by integrating its core business of mining with finance and trading, and optimizing its asset and financial portfolios. We will make the most out of our investment company in Shanghai as well as our platform for overseas operations, finance and trading in Hainan. Success on these fronts will inject new impetus to our sustainable development and create more value for our shareholders and investors.
The Group will step up the recruitment, training, and use of young, internationally competent talent and skilled workers. Our plan is to recruit 1000 top graduates this year. We will strengthen internal supervision and fight corruption, and with integrity and honesty we closely engage with our stakeholders so that we can grow together.
Every action is guided by our corporate culture. We always stick to our philosophy of “Mining for a Better Society”. And we will bring more benefits to more people so that our values and visions will be better understood.
We live in a great era, with massive potential and opportunities to be explored. As an important player in the global mining industry, Zijin Mining is determined to rise to the challenge, improve its global competitiveness, and scale the heights of this new journey, so as to be a green, high-tech, leading global mining company as early as possible.
Happy new year! And I wish all of you the very best.
紫金矿业 董事长 陈景河
Chen Jinghe, Chairman of Zijin Mining Group
December 31, 2021