The Rosebel gold mine Photo: Screenshot of IAMGOLD website.

China's largest gold producer Zijin Mining Group announced on Tuesday the acquisition of Rosebel gold mine in Suriname, one of the largest of its kind in South America, with a proposed investment of $360 million, further expanding the company's competitiveness among global gold producers. 

While the world is in the midst of high inflation, including some major economies such as the US, gold has gained popularity for its hedging function. Through the acquisition of the Rosebel Gold Mine Project held by the Canadian IAMGOLD Gold Mining Company, Zijin's gold mergers and acquisitions have achieved another success in the rising global competition.

As one of the largest gold mines in South America, Rosebel Gold Mine has about 217 tons of gold resources, and still has a lot of potential.

Since mining began at Rosebel in 2004, the average annual gold production has exceeded 10 tons. In the first half of this year, it produced about 3.5 tons of gold. More than 8.6 tons of gold is expected to be produced annually according to a preliminary estimate, and there is potential for further expansion, according to Zijin.

Zijin's competitive advantages in technology and management are expected to maximize the resources of the mine while reducing production costs.

At present, the international gold price is hovering above $1,600 per ounce, but many gold mining stocks are lower than when the gold price was $1,200 per ounce, so now is a good opportunity to acquire gold assets, Samson Li, a Hong Kong-based analyst for the Dutch Commodity Discovery Fund, told the Global Times on Wednesday, commenting on Zijin's moves.

It is estimated that this year's output at Rosebel will be about 150,000 ounces, Li said.

Also, through the acquisition, Zijin is planting its flag in a Latin American country, providing the company with more synergies and awareness in South America, he said.

Approval for the deal is still needed from the governments of China and Suriname, Zijin noted in the statement.China's Zijin Mining Group acquires major gold mine in South America, expanding global reach