The MCC Resources Development Limited (MRDL), a subsidiary of the China Metallurgical Group Corporation (MCC), has shelved a plan to set up a refinery at Saindak to separate gold from blister copper.

Talking to Daily Times at the Metal Mining Complex at Saindak in Chagai district, MRDL Chairman Zou Jianhui said the refinery was not feasible at Saindak, with its current quantum of blister copper production. He said the refinery was feasible at a blister copper production level of 100,000 tonnes a year, but the Saindak project was producing only 18,000 tonnes.

The MRDL chief said that there were compatible charges to refine gold and copper in the international market and it was relatively cheaper to undertake the job there instead of setting up a gold refinery at Saindak.

The Pakistani government signed an agreement with the Chinese government for a soft loan of $22 million in early the 1990s to establish the proposed refinery. The agreement was signed when Saindak copper reserves were handed to MRDL after the MCC set up the first metal mining complex at Saindak at an initial cost of $141 million. The investment was a soft Chinese loan for Pakistan.

Jianhui said that setting up a refinery with the current production level would overburden the commercial venture with more losses and debt. He showed keen interest in continuing the production even beyond 2010, when the lease period for the MRDL ends. He said that Pakistani workers would replace a number of Chinese workers and technicians next year. “Pakistanis are being trained in phases for the purpose,” he said. He did not give the exact number of Chinese experts to be replaced by Pakistanis. He said that negotiations were in progress with Pakistani officials on the training of local workers and transfer of technology to Pakistan.

The MRDL chairman said the company had brought experts from China, therefore the performance of Saindak was much better than many of the companies working under the MCC in China. About the expansion of the metallurgical complex, he said that it depended on the Eastern Ore Body. He said the MRDL would expand the complex if it finds better grade copper reserves here.

Jianhui was concerned over the rising oil prices. He said the cost of production had gone up by 50 to 60 percent since the MRDL started production of blister copper at Saindak. He said there had been a 400 percent increase in the oil prices over the past few years.

Asked why MRDL was not importing furnace oil from Iran (a few miles from the Saindak metal mining complex) instead of transporting it from Karachi (about 1,000 kilometres from the project), Jianhui said the Pakistani government had allowed the company to import furnace oil from Iran, and the company was trying to do so.

The MRDL chief said the company was providing free electricity to two of the surrounding villages at a cost of Rs 4.4 million a year. He said the company was also running a school for locals.

Source: Daily Times