Active Mixed AidData Chinese Aid

China Development Bank provides $140 million loan for Technological Innovation of ZGC Gold Mine (Linked to Record ID#72389, #72802, #40482, #40481, #69997)

$140M USD

Funder	China Development Bank (CDB)
Recipient Organization	JV Zeravshan LLC
Country	Tajikistan
Start Date	May 19, 2013
End Date	Jul 27, 2026
Duration	4,817 days
Number of Grantees	1
Roles	Recipient
Data Source	AidData Chinese Aid
Grant ID	`40479`

Grant Description

China Development Bank provides $140 million loan for Technological Innovation of ZGC Gold Mine On May 19, 2013, China Development Bank (CDB) and Zijin Mining Group signed a loan agreement with JV Zeravshan LLC (formerly known as Zervashan Gold Company) -- a special purpose vehicle and joint venture of Zijin Mining Group Co., Ltd (70% equity stake) and the Government of Tajikistan (30% equity stake) -- worth $140 million.

The proceeds from the loan were to be used for the Technological Innovation of ZGC Gold Mine in Tajikistan, a project that aimed to expand the production capacity of a gold mine in the town of Panjakent within Zarafshon in northern Tajikistan.

As of March 28, 2014, the project had entered implementation and achieved the following objectives: (1) the stripping of infrastructure of Jilao open-pit mine and Taror openpit mine had been completed for over 90% and 80%, respectively; (2) the reformation of industrial pilot production processing technology of Taror oxide ore processing plant had been completed; and (3) the Jilao 10,000 tonnes processing plant project had entered into civil engineering construction and installation stage.

Upon completion, the project was expected to increase the mine's production to 3.5 tonnes of gold per year.

📋 Staff Comments

In 1994, Zeravshan Gold Company (ZGC) was launched as a joint venture with Nelson Resources Ltd (44%) and the Tajik Government (51%) and the IFC (5%). Then, in September 2002, Avocet signed a heads of agreement to acquire the Tajik gold assets of Toronto-based Nelson Resources Ltd held through Nelson’s subsidiary, Commonwealth and British Minerals Ltd, including its 44% interest in ZGC. In November 2004, Avocet increased its equity interest in ZGC from 49% to 75%. Then, in 2007, Zijin paid $429.8 million HKD to acquire Avocet's stake. In February 2018, Zijin Mining, sold 5% of its shares in JV Zarafshon (its new name) to the Tajik government for $1.00 USD. With this, Zijin's share fell to 70% ($16,974,364 USD), while the Tajik government's share rose to 30% ($7,274,724 USD).
This project was one of many signed during the same visit of the President of Tajikistan to China from May 19, 2013 to May 20, 2013. The other projects were: loans worth RMB 33 million to Amonatbonk (captured via Project ID#69997), an RMB 200 million grant (captured via Project ID#40481), a loan for the reconstruction of Regar Substation (captured via Project ID#40482), loans totaling $20 million to Amonatbonk (captured via Project ID#72802), a technical cooperation agreement, a fruit inspection protocol, and a sports cooperation agreement.
The project is linked to another Zijing Group stake acquisition project (captured via Project ID#72389).

📚 Sources & References

China extends $140 mln loan for development of major gold mining company in Tajikistan
China allocates $140 million for Tajik gold mining company
Tajikistan increases gold and silver production
China allocates $140 million for Tajik gold mining company
Tajik-Chinese joint gold mining venture resumes operations
Zijin Mining Group Co.
Ltd 2016 Circular, 2013 Annual Report, 2013 Interim Report, 2016 Annual Report
Central Asia Mining Sector Work in Central Asia
China’s Zijin Mining sells 5 percent of shares in JV Zarafshon to Tajik government for…1.00 USD
Tajikistan buys shares of Chinese gold mining enterprise for $1
Tajik-Chinese joint gold mining venture resumes operations
Tajik-Chinese gold mining joint venture temporarily suspends operations due to reconstruction works
Tajikistan buys 5% share in gold mining facility for $1
Zeravshan: Jilau Gold Expansion Project
The pros and cons of Chinese investment in Tajikistan's gold mining sector Loan applications and disbursements are still being received and processed as the projects continue to evolve. Ongoing monitoring and evaluation are in place to ensure project continuity.