|Yingjiang County Kunrun Industry Company Limited|
|Established in 2009 and with a registered capital of 56 million RMB, Yingjiang County Kunrun Industry Company Limited (hereinafter referred to as “Kunrun”)is a mining company with both mining and processing of lead, zinc and silver as its major business. Kunrun owns the mining right of both the Shizishan mine and Dazhupeng mine with the Shizishan mine attained its full mining capacity at the end of 2012 and the Dazhupeng mine undergoing exploration but with great potential for exploration. Thanks to the efforts of all its staff members, the company earned its profits the same year when the Shizishan mine achieved its full mining capacity. Kunrun's profitability will be greatly boosted as the scale effect gradually releases its function.
The Shizishan lead-zinc-silver mine operated by Kunrun is a large, high-grade underground mine located in Yingjiang county, Yunnan province. Covering an area of 3.2 square kilometers, the Shizishan mine has a total of 1.2 million tonnes of JORC compliant lead and zinc reserves and 2000 tonnes of JORC compliant silver reserves with the average grade across the whole ore body for combined lead and zinc of 15% and average grade for silver of 250g/t, significantly higher than the Chinese industry average. The Shizishan mine has a mining capacity of 2000t/d, which was attained at the end of 2012, and a processing capacity of 2000t/d, which was realized in October 2011 when its processing facility was completed. In 2013, the Shizishan mine’s total mined raw ore is 453.8 kt, representing an increase of 31.8% as compared to 2012. The production volume of lead, zinc and silver are 23,526 t, 17,910 t and 54,097 kg respectively, representing an increase of 16.0%, 8.2% and 26.4% respectively as compared to 2012.