China gold & golden sands: Australia's mining entrepreneur Nick Curtis has bold investments and brave plans for a unique gold play in China and a rare earths resource from Australia.

• Position: SINO GOLD

As foreign companies circle the China gold market, Australia- based Sino Gold is gearing up to mine the country's second-largest gold deposit.

After five years of negotiations, the small Australian-listed company last month received a permit to develop the $90 million Jinfeng mine in Guizhou province, which has gold reserves of more than 2 million ounces.

After some disappointing results on its first China mine, Sino Gold chairman, former Macquarie Bank executive Nick Curtis, is hoping the much larger Jinfeng project will set up the company to become a player in the inevitable consolidation of the country's gold industry.

"The total focus of our company has moved to Jinfeng", says Curtis. "Our shareholder value will be created by the development of this mine. It is a big gold mine in anybody's context."

Curtis has been involved in China since his days at Macquarie Bank 12 years ago when he began advising the Chinese government-owned non-ferrous industry group, CNNC, on setting up a subsidiary in Australia called Sino mining.

Curtis left Macquarie to become chief executive of Sino Mining. He expanded the company's operations including onshore China, where it began working on its first gold mine in Jianchaling in Shaanxi province in 1996.

In 2000, following changes in China, Sino Mining's gold interests were spun off into Sino Gold.

In December 2002, the company was listed on the Australian Stock Exchange, raising almost $19 million.

Current shareholders include Sino Mining parent, Chinese-owned Minmetals with 12 percent, South Africa's Gold Fields, the world's fourth-largest gold producer (84.3 percent), World Bank subsidiary International Finance Corporation (6.7 percent), Standard Bank London (6.4 percent) and Colonial First State (5.6 percent).

"We have a study to take it up to 300,000 ounces a year which is highly feasible," says Curtis. "This would make it the largest producer of gold in China."

He says the company has exploration licences around the Jinfeng mine which could also yield high grades of gold ore.

Mining giants, including BHP, are known to have looked at the massive Jinfeng deposit from time to time but decided not to mine it.

Curtis argues that the majors probably looked at Jinfeng too early, before the recent modernisation in the administration of the gold mining industry in China. He also argues that the mining industry in China is still high-risk, probably best suited to junior minors like Sino Gold which can take higher risks.

"The boom is on in China with the junior companies looking to find...