Zijin News - On the evening of March 18, Zijin Mining Group (“Zijin”) released its 2021 annual report. Zijin’s performance hit a record high, with both revenue and total assets exceeding RMB 200 billion. In 2021, Zijin’s EBITDA stood at RMB 35.1 billion, and total profit was RMB 24.8 billion. Net profit attributable to shareholders of the parent company was RMB 15.7 billion, up 141% year-on-year. Net operating cash flow reached RMB 26.1 billion. Zijin will distribute a cash dividend of 2 yuan per 10 shares. The dividend payments total RMB 5.3 billion, up 67% year-on-year.
Thanks to the commissioning of three world-class copper mines - Kamoa-Kakula copper mine in the DRC, Čukaru Peki copper and gold mine in Serbia and Julong copper mine in Tibet, Zijin’s copper and gold resources and reserves, mineral production, sales revenue, net profit attributable to the shareholders and other key financial indicators are approaching or ranks among the top 10 in the world. Major performance indicators of its overseas segment surpass those of its domestic projects, making Zijin one of the world’s leading metal mining companies.
Zijin unveiled its Five-Year (2+3) Plan and 2030 Development Goals at the start of 2021, aiming to become a leading global metals and mining company through a three-phased approach in ten years.
2021 marks the beginning of the first stage. In face of the pandemic and major changes unseen in a century, Zijin’s employees overcame difficulties to put number of key projects into production. Three world-class copper mines kicks off commercial production, beating expectations and making Zijin one of the leading mining companies with the largest and fastest growth of copper output.
Seizing the opportunity of rising metal prices, Zijin works to turn its resources into economic and social benefits at a fast pace. In 2021, it produced 584,000 tonnes of mined copper, 47.5 tonnes of mined gold, 434,000 tonnes of mined zinc (lead), 309 tonnes of mined silver and 4.25 million tonnes of iron concentrate, up by 29%, 17%, 15%, 3% and 10% year-on-year respectively. The gross profit margin of its mineral products increased by 58.98%, representing an above-average profitability in the mining industry.
Sound operation and solid management have further reinforced Zijin’s position in the global capital market. Zijin’s A shares have been included in FTSE China A50 Index and SSE 50 Index, and the group’s total market cap ranks among the top 10 global metal mining companies.
As an important player in the global mining market, Zijin acts to meet targets set in the Paris Agreement and the “carbon neutrality” initiative. In view of a major revolution in the energy mix brought about by the push for carbon peaking and carbon neutrality, Zijin redefined its strategic goal as “to be a green, high-tech, leading global mining company”, where “green” and “high-tech” are its key priorities.
As the key contributor of its growth, copper is also crucial to renewable energy and has become a core driver of Zijin’s future development.
To build its green, global competitiveness, Zijin has entered the fields of renewable energy and advanced materials, building on its expertise in the traditional mining industry. It has completed the acquisition of the Tres Quebradas lithium brine project, a world-class high-grade lithium project in Argentina, acquiring about 7.63 million tonnes of lithium carbonate resources. The phase 1 of the project has a designed capacity of 20,000 tonnes of battery-grade lithium carbonate per annum, and is expected to come on stream by the end of 2023. Zijin also secured rights to explore and develop greenfield projects at the periphery of the Manono lithium mine in the Democratic Republic of Congo (the DRC).
Zijin released its 2021 Annual Environmental, Social, and Governance Report (the “ESG Report”) in tandem with the 2021 Annual Report. According to the ESG report, Zijin cut its CO2 emission per RMB10, 000 of sales revenue down 9.5% year-on-year to 0.32 tonnes in 2021. When building international green mines, Zijin has also leveraged the resources at the periphery of its mines to develop clean energy projects such as solar power generation, wind power, and hydro power projects. In 2021, such projects generated substantial renewable electricity, helping reduce CO2 emissions by 116,300 tonnes, an equivalent to planting 63,442 trees. In addition to mining, Zijin has launched a number of projects on advanced materials such as lithium iron phosphate, electrodeposited copper foil, and high-performance alloys. It has also been driving the development of hydrogen energy, the “ultimate fuel”, by launching on an ammonia-to-hydrogen project together with Fuzhou University.
Zijin has redefined its resources and reserves according to the latest, international standards. As a result, the confidence of its resource and reserve estimation has been improved. Its copper metal resources have reached 62.77 million tonnes, of which 20.33 million tonnes are reserves; and its gold resources have totaled 2,373 tonnes, of which 792 tonnes are reserves. Based on figures from the China Mineral Resources 2021 published by the Ministry of Natural Resources, the copper and gold reserves of Zijin account for 75% and 41% of China’s total copper (27.013 million tonnes) and gold reserves (1,927.37 tonnes) respectively.
Zijin secured more than half of its resources and reserves through in-house exploration, an indication of its strong capabilities in discovering ore deposits. More than 50% of its gold and copper resources and reserves, production as well as profits are contributed by the group’s overseas operations. Specifically, overseas operations account for 76% of its total copper resources, 74% of the total gold resources, 53% of the total mined copper, 60% of the total mined gold, and 51% of the total earnings.
The year 2022 is the final year of the first phase (2021-2022) in Zijin’s drive towards delivering its ten-year strategic development plan. In this year, new growth projects will continue to maintain steady-state production and even scale up production, so as to fulfill its annual targets of producing 860,000 tonnes of mined copper and 60 tonnes of mined gold.
In addition to fulfilling its production guidance for 2022, Zijin will strive to add over 200,000 tonnes to its annual copper production capacity by accelerating the application of block caving technologies in four major underground porphyry deposits: the Tongshan copper mine in Heilongjiang province, the Zijinshan Luobuling copper (molybdenum) mine in Fujian province, the JM copper mine of Bor copper mine in Serbia, and the lower zone of the Čukaru Peki copper and gold mine in Serbia.
To outperform its copper production guidance by 2025, Zijin will expedite the construction of the phase 2 of the Tibet Julong copper mine, so as to expand its annual copper production capacity by 200,000 tonnes. The Kamoa copper mine in the DRC will complete its phase-2 construction and launch some of its phase 3 development as soon as possible, which will add 120,000 tonnes of copper capacity for Zijin. Meanwhile, the group strives to produce 50,000 tonnes of lithium carbonate per annum by 2025.