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Listed on the London stock exchange, ABG owns gold mines and exploration properties in Africa/XINHUA-File

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China firm eyes Canadian gold giant’s Africa assets

Listed on the London stock exchange, ABG owns gold mines and exploration properties in Africa/XINHUA-File

BEIJING, Aug 17 – A state-owned Chinese firm is in talks to buy some of the African assets of the world’s largest gold miner Barrick Gold Corp., Beijing’s latest move into the resource rich continent.

“Our group is currently having very preliminary contact and discussion with Barrick” on possible acquisition of African Barrick Gold (ABG), an official with China National Gold Group, who declined to be named, told AFP.

He did not elaborate on details of the talks but Dow Jones Newswires reported that analysts have estimated the deal could be worth up to $3.9 billion.

In a statement Thursday Barrick confirmed “discussions are at an early stage” with the Chinese company over its 73.9 percent holding in ABG.

Listed on the London stock exchange, ABG owns gold mines and exploration properties in Africa, according to Barrick.

Barrick’s equity interest in ABG’s 2011 production was 509,000 ounces (14.4 tonnes) of gold, and it is expected amount to between 500,000 and 535,000 ounces this year, according to the company.

China has been encouraging its companies to invest in overseas mines and other resources to fuel its fast-growing economy.

Beijing-based China National Gold is the nation’s biggest gold miner by output and it also mines silver, copper and other metals, it says on its website.

Last month, state-owned energy colossus CNOOC announced a $15.1 billion bid to buy Canada’s Nexen, in what would be the largest-ever foreign commercial purchase by the oil-hungry nation.

China’s consumption of gold surged 33.2 percent last year from 2010 to 761 tonnes, data from the government-linked China Gold Association showed.

The majority was sold as accessories to increasingly affluent Chinese consumers, who traditionally deem the precious metal a hedge against inflation.

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