Zijin Mining aims to convert $200mn Glencore bonds into shares after IPO

HONG KONG: Chinese gold miner Ltd wants to covert $200 million worth of Glencore International AG bonds it holds into shares after the global commodities trading giant lists, a Zijin executive said on Thursday.

"When we bought the bonds, our aim was not just to earn a profit. We wanted to establish a long-term strategic relationship (with Glencore)," Vice-Chairman Lan Fusheng told reporters in Hong Kong on Thursday after the company's annual results announcement. "We will convert all (the bonds) into shares."

Glencore plans to launch an initial public offering in Hong Kong and London, aiming to raise about $10 billion.

Separately, Lan said the Zijin's copper mine project in Peru was facing design problems that needed an environmental assessment in advance, and the support of two-thirds of the local community, which it did not have.

Zijin was in talk with two major companies in Peru to jointly build the copper mine, he said.

"If (we) want to push the project ahead, (we) may rely on local companies to do so," Lan said.

Zijin, China's top mined gold producer, said in its results statement that it planned to raise mined gold production by 2 percent to 29.76 tonnes in 2011 from 2010's 29.18 tonnes.

The company also said it planned to reduce production of copper by 2.8 percent to 87,800 tonnes this year from 2010's 90,287 tonnes. It said refined zinc production was expected to fall to 200,000 tonnes in 2011 from last year's 223,822 tonnes.