China's largest gold producer Zijin Mining Group was urged by the government to curb its gold production to reduce environmental safety pressure at its flagship mine Zijinshan mine, which spilled acid-laced waste to a river and reservoir in Fujian Province earlier this month.

The decision was made at a meeting organized by the local government Monday, the company said in its filings to the Shanghai Stock Exchange last night.

Zijin said the company's gold output would be cut by 1 ton, one percent of the company's annual gold production in 2009. Zijin assured investors before that the spill will not influence its gold business.

The spill, the industry's worst in two years, has forced Zijin to suspend trading twice in a month. As of Zijin's last trading day July 23, shares of the company have tumbled 10.6 percent in Hong Kong and 4.3 percent in Shanghai from July 9, the last trading day before July 12 when the company disclosed the spill.

Zijin was forced to shut the plant at Zijinshan mine in mid July. Zijin's copper mining activities in the plant won't be resumed before the end of the year, said Luo Yingnan, president of Zijin Mining Group.

Though it is still not clear whether further production curbs on gold mining will be enacted, analysts expressed concerns about Zijin's annual financial achievements.

Liang Jianwen, Guangdong-based nonferrous metals analyst with Guotai Junan Securities, said Zijin will be dealt a big blow if its gold mining activities are curtailed extensively considering contributions of gold business to Zijin's revenue.

According to Zijin's 2009 annual financial reports, the Zijinshan mine produced nearly 60 percent of Zijin Mining's unprocessed gold. And Zijin's gold business accounts for nearly 75 percent of the company's sales revenue.

Zijin reportedly tried to rein in news coverage about the leak by offering cash bribes to reporters who went to cover the accident earlier this month.

The company was involved in a series of pollution incidents since 2006 in North China's Hebei and South China's Guizhou provinces, according to China Entrepreneur magazine. Spokesman Zhao Jugang said earlier the company plans to invest 200 million yuan ($29.49 million) within a year on environmental and risk measures.