Jan 29, 2009 (DVB), Authorities in Koh Bu Deh township in Kachin state have banned local gold prospectors from digging in a small goldmine in the township after giving the contract for the mine to a Chinese company.

The company will be working together with a pro-government group named the Anti-Insurgent Group, a splinter group of the New Democratic Army-Kachin led by Atan Kutan.

After the Chinese company was granted the licence to extract gold from the mine, Atan Kutan’s group formed a company called La Pyay Wun and signed an agreement with the Chinese business on 22 January.

A Rawan tribesman who lives in the area said police in San Yot had begun seizing gold digging equipment from locals in the area.

"They have seized control of all the goldmines to let the Chinese company and Atan Kutan’s group dig there," he said.

"They said we would not get a penny from them."

Awng Wa of the Kachin Development Network said the ban would harm locals' livelihoods.

"Local people have been digging small amounts of gold from Chan Kat creek just to maintain their survival in the area where is impossible to grow crops due to extremely cold weather," he said.

"Now they have nothing left to do."

Reporting by Nan Kham Kaew