China's largest gold miner, Zijin Mining, has expressed "deep sorrow and regret" over a dam collapse in September that killed at least 22 people and offered to donate 50 million yuan (US$7.5 million) to help victims of the tragedy.

In a statement to the Hong Kong Stock Exchange, the company said on Tuesday the dam breach was aggravated by the collapse of the Gaoqiling tailings pool dam of Yinyan Tin Mine, which was owned by Zijin Mining's subsidiary Xinyi Zijin.

The money, which will be donated to Xinyi city's bureau of civil affairs, is intended to assist victims downstream from Xinyi Zijin Yinyan Tin Mine to enable them to rebuild and "to fulfill the company's social responsibility", the statement said.

The dam breach accident, which occurred when a typhoon hit Guangdong Province, left 22 people dead and 523 houses destroyed in Xinyi city. Guangdong provincial authorities said in a statement on Dec 21 that Xinyi Zijin, owner of the breached dam, was liable for the accident.

The dam held waste from Xinyi Zijin Yinyan Tin Mine. Its contents overflowed on the morning of Sept 21, as Typhoon Fanapi hit the area, pounding it with rain and dislodging mud and rocks from the dam, which flattened part of the village.

Safety and construction violations, which had lowered the dam's effectiveness as a flood control device, were cited as reasons for the collapse, according to the statement from the provincial authorities.

Thirty-six people, including the director of Xinyi city's work safety bureau, the director of Xinyi city's land and resources bureau and the general manager of Xinyi Zijin Mining, were believed to have been derelict in their duties and responsible for the accident, the provincial authorities said.

Fifteen people among the 36 were transferred to prosecutors for further possible action, they added.

Zijin Mining said it respected the findings of the Guangdong provincial government over the accident.

The company said Xinyi Zijin, which had suffered losses and damage inflicted by Typhoon Fanapi, had already donated 1.5 million yuan to Xinyi city.

Zijin Mining said it backed Xinyi Zijin taking all measures, including the disposal of assets and equity, to raise funds to settle claims made by victims of the disaster.

Xinyi Zijin, which currently has insufficient cash or cash convertible assets and about 200 million yuan in debts, has decided to sell Yinyan Tin Mine, including the mining rights, and use the proceeds to settle claims made by the victims, it said.

The government of Xinyi city currently has a lawsuit filed against Xinyi Zijin, in order to confirm the amount of liability and compensation. Both parties will resolve the matter in court or by negotiation, Zijin Mining said in its statement.

(China Daily December 29, 2010)