quote:De Gouveia: I?ve been reading an article, which says that...

quote:

De Gouveia: I?ve been reading an article, which says that it was announced in a statement recently that China?s demand for gold literally exploded in 2010 and there are reports now as well, that Chinese investors are homing in on South Africa?s precious metals mines. What can you tell us about that?

Creamer: It?s all happened this week and this month and in the last few months. We saw now that Gold One, which is listed in Sydney and on the Johannesburg Stock Exchange, of course, they own assets on the East Rand. A young junior gold mining company headed by Neal Froneman, quite a prominent gold miner who discovered these assets after 100 years of mining here.

We still had virgin reef just close to Springs, which was quite astounding. He has developed that gold mine on the East Rand and that has been the flagship for Gold One, which as I say is listed in Johannesburg and Sydney and now might also be listed in Hong Kong. We have had a swoop from the Chinese company Baiyin Non-Ferrous, which is keen on getting control.

They want 60% of this if possible and they are saying that this South African company is great, but unambitious and they want to bankroll it to do a lot more deals and a lot more consolidation not only in South Africa but also in Africa. That is that hunger for gold we see from China. Then also, on the platinum side, we?ve noticed that Jinchuan has come in and taken control of Wesizwe platinum, which is a small junior as well operating near Sun City.

Not only have they come in as an investor, but they ?ve come in with a batch of directors, filled the board with about five new Chinese names and also ousting the South African black CEO Arthur Mashiatshidi who is going to make way for a Chinese CEO. Down in Springs again we have got Shandong the Chinese gold mining company wanting to do a due diligence and there is going to be a team out here next week to take over the Grootvlei and Orkney assets, which have been so controversial.

Again, made South Africa a laughing stock because we?ve had this liquidation which has been marathon liquidation and we?ve had the top personalities Khulubuse Zuma and Zondwa Mandela involved and they have made a hash of this acquisition out there and they need to be rescued by the Chinese. That is not the sort of deals where we have desperate situation where we have to lower the price of our assets.

If you look at Grootvlei, although they got a water problem, there is still like 200 tons of gold down there. Now, the Chinese may get their hands on it. Faltering by South Africans has allowed the Chinese to swoop in and with their funds they are able to home in on precious-metals here on three fronts we see, platinum, gold and gold again.