Australian gold miners take back resources
KALGOORLIE (miningweekly.com) – Australian-owned mining companies have become the majority shareholders in the country’s A$12-billion gold mining industry, with foreign investors selling their stakes in projects, mining consultancy Surbiton Associates reported.
In 2013, Australia’s gold output increased to 273 t, up from the 255 t reported in the previous year. This output made Australia the world’s second-largest gold producer, trailing China, which produced 428 t in 2013, and leading the US, which produced 227 t.
“When the gold boom started in the early 1980s, Australia’s control of its domestic gold mining industry was around 80%. However, around the turn of the new century, there was a spate of overseas takeovers when the Australian dollar was weak and Australian control fell below 30%,” said Surbiton director Dr Sandra Close.
“But it has slowly climbed back, local control has now risen to about 50%,” she added.
Close noted that the pace of overseas selling has increased significantly, with local companies already operating in the gold industry expanding their gold interest.
Close pointed to Canadian gold miner Alacer Gold, which sold its Higginsville and South Kalgoorlie operations to ASX-listed Metals X in late 2013, while Barrick Gold also sold its Kanowna Bell and Plutonic mines, along with its 51% interest in the East Kundana joint venture to Australian gold miner Northern Star Resources, which already owns the Paulsens mine, in Western Australia.
Northern Star also bought the Jundee mine from major Newmont Mining in early July.
“Several of the world’s largest gold producers have switched their strategy from chasing ounces to rationalization and cost reduction. This does not always sit easily in an Australian context as, unlike many other gold producing regions, Australia’s production comes from a considerable number of smaller mines, rather than a small number of larger mines,” said Close.
She added that despite the country having the world’s largest gold reserves, with the US Bureau of Mines estimated that some 9 900 t of was contained in reserves in 2013, a large portion of these were locked up in iron oxide/copper/gold deposits.
As a result, these were considered large, long-term operations and the rate of mining was based on the rate of production of the main ore component, which was copper, with the amount of gold output contingent on the overall production schedule.
“So it looks great on paper, but the practicalities are such that much of our gold reserves are for the very long term. For a sustainable industry, we still need production from traditional primary gold deposits, and ongoing exploration is as vital today as it ever was,” Close added.
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