Eldorado Gold is aiming to float shares in Hong Kong next year to bankroll a quest for projects in China, the firm's top executive said Tuesday.

The gold miner, listed in Toronto and the United States, will start trial operations at its first mine in China by the end of this month, making Hong Kong an attractive option to help finance more mainland projects.

Eldorado Gold joins a lengthening list of junior gold miners pondering tapping Hong Kong, Asia's largest bourse after Japan, for capital to fund projects in China or elsewhere.
Sino Gold, the first foreign firm to mine gold in China, said Monday it had appointed Morgan Stanley to advise it on a listing in Hong Kong.


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Eldorado president and chief executive Paul Wright would not disclose the size of any planned offering and said the firm had not appointed a listing adviser.
Wright said he would meet with the Hong Kong stock exchange to discuss a listing plan and seek clarification on listing requirements.

"Our views on business are very long term," he said when asked whether the firm might scrap the plan if gold prices fell.

Gold reached a 26-year high of US$730 (HK$5,694) an ounce in May but the price has dropped since, partly in tandem with weaker oil prices. It traded at US$577.30 Tuesday afternoon.

Shares in two Hong Kong-listed mainland gold producers, Fujian Zijin Mining Industry (2899) and Lingbao Gold (3330), have risen this year on the back of strong prices. Eldorado Gold operates gold mining projects in Brazil, Turkey and the mainland and has a market capitalization of about US$1.4 billion.
I
ts mainland project in northwestern Qinghai province is operated by a joint venture 90 percent-owned by Eldorado Gold and the remaining 10 percent split equally between two Chinese shareholders.

The Tanjianshan mine is expected to produce about three tonnes of gold in 2007, out of Eldorado's expected total output of 11 tonnes next year, Wright said. Total gold production is expected to come in at 5.5 tonnes to six tonnes this year.

The mainland plant can process 800,000 tonnes of ore per year.
Wright said the average grade of the mine was 4.5 grams of gold per tonne of ore - relatively low compared with world-class mines.

Reserves would allow that size of production for 11.5 years, with an estimated cash operating cost of US$235 an ounce, he said.
That compares with the world's top gold producer, Barrick Gold, which saw an average cost of US$227 per ounce last year.

Eldorado Gold is exploring for more reserves at its Qinghai site while seeking other gold mining projects in the province and in other western provinces.
"When we are entering a new country, it is our intention to be here for a long period of time to build a multimine business," Wright said.