China discovered a huge gold reserve in Hunan Province; How much does it cost?

Latest update:Nov 23, 2024 05:06 PM IST

Under its 2021-2025 development plan, China has increased domestic reserves of strategic resources, increasing investment in mineral exploration by 8% to 110.5 billion yuan (Rs 1.27 crore).

According to the Hunan Provincial Geological Institute, the total gold reserves in the main mine area have now reached 300.2 tons. (Rep/AP File)

China has discovered a huge reserve of gold in Hunan province. The estimated value of this huge reserve is estimated at hundreds of billions of rupees and is expected to support the weakening Chinese economy. This discovery is not just an expansion of its mineral wealth, but also represents a potential economic strategy that could strengthen China around the world.

According to the South China Morning Post, the gold reserve is located in the Wangu gold mine in Pingjiang County, Hunan Province. More than 40 gold veins have been discovered in this mine, located less than 2,000 meters underground.

According to the Hunan Provincial Geological Institute, the total gold reserves in the main mine area have now reached 300.2 tons. In addition, the newly discovered reserves contain more than 1,000 tons of gold. The total estimated value of these reserves is about 600 billion yuan (about 7 million rupees).

Liu Yongjun, vice president of the Hunan Provincial Geological Institute, called the discovery a major success for China’s mineral exploration strategy. The Wangu mine is already one of the most important gold mining centers in China. Since 2020, the provincial government has invested more than 100 million yuan (around Rs 115 crore) in mineral exploration in the area.

In recent years, China has seen a surge in demand for gold, driven mainly by economic uncertainty. However, this demand has weakened slightly, due to two key factors: the central bank’s decision to halt gold purchases in May and the weakening of the yuan. This decline in demand also contributed to the fall in gold prices. It is noteworthy that in the retail market, jewelry from renowned companies such as Chow Tai Fook and Chow Sang Sang, which used to cost 820 yuan, is now selling at 720 yuan (about Rs 8,300) per gram.

China is focusing on increasing domestic reserves of strategic resources as part of its 2021-2025 development plan. Investment in mineral exploration in 2022 increased by 8% year-on-year to RMB 110.5 billion (about Rs 1.27 million). This has led to an increase in reserves of not only gold, but also critical resources such as oil, natural gas and rare earth elements.