Australian gold production rose strongly in the December 2009 quarter, according to the latest overview of the Australian gold sector released by Melbourne-based industry consultants Surbiton Associates.
Gold output rose by seven tonnes, or 13%, to 62 tonnes (2 million ounces), compared with the September quarter 2009 and by 14% compared with the December quarter 2008. For the full 2009 calendar year Australia produced 227 tonnes (7.3 million ounces) of gold, an increase of 3% on 2008.
Surbiton Associates’ director Dr Sandra Close says, “The increase in production to 227 tonnes cemented Australia’s position as the world’s second largest gold producing country.”
“China was the largest producer in 2009 at 314 tonnes, with preliminary figures putting the US third at about 216 tonnes and South Africa fourth at about 210.”
At the current Australian gold price of around Aus$1250 per ounce, the 227 tonnes produced in 2009 is worth more than Aus$9 billion, making gold a significant contributor to Australian export earnings.
Sandra Close says, “The increase in Australian gold output in the December quarter was assisted by the long-awaited opening of the giant, re-developed Boddington operation. As well, several other operations increased production substantially, taking advantage of the attractive gold price and attractive operating margins.”
The Boddington mine in Western Australia (WA), owned by Newmont Mining, is still in the ramp-up phase and produced 118,000 ounces or about 3.7 tonnes of gold in the December quarter. It was re-developed at a total cost of more than Aus$3 billion and is expected to produce at a rate of more than 200,000 ounces of gold per quarter this year.
Several of the larger producers increased output in the December quarter. These included the Super Pit at Kalgoorlie (Newmont/Barrick) with production up 28,000 ounces and Cadia Hill (Newcrest) with production up 23,000 ounces, both due to higher grade ore. Also, output at Yilgarn South operations (Barrick) rose 23,000 ounces due to a large increase in ore throughput.
Among the smaller producers, Ramelius Resources’ new, high-grade, underground mine at Wattle Dam added 21,000 ounces to the total.
Sandra Close says, “Gold production should increase in the near term, with the continued ramp up of Boddington plus output from additional producers in WA. Despite the low level of exploration, which is still a real cause for concern in the longer term, the current attractive gold price and margins are fostering the redevelopment of old operations and there are even a few new developments as well.”
Focus Minerals recently recommissioned its Three Mile Hill treatment plant near Coolgardie and will no longer need to rely on scarce toll-milling capacity in the area. Saracen poured the first gold from its redeveloped Carosue Dam mine near Leonora at the end of January, while Navigator Resources is expected to restart its Bronzewing operation in the next few weeks. As well, Catalpa Resources’ should begin producing in June from the re-juvenated Edna May project at Westonia.
A1 Minerals’ BrightStar project north of Laverton is a new operation which poured its first gold recently, while Integra Mining’s Randalls project and Regis Resources’ Moolart Well project are both new developments which are expected to produce their first gold in September.
The only operation expected to close shortly is Intrepid Resources’ Paulsens mine which produced about 16,000 ounces in the December quarter.
Dr Close said that many of the recently developed gold projects are owned by Australian companies, so that the level of foreign control in the industry has fallen since the major takeover activity in the late 1990s and early 2000s.
“From around 20% in 1997, overseas control of Australia’s gold mining industry peaked at over 70% in 2003,” Dr Close said. “It then trended down slowly and was just under 60% by the end of 2009.”
The top five producing operations for 2009 were the Super Pit Joint Venture operated by Newmont and Barrick Gold with 688,000 ounces, Newcrest’s Telfer with 674,445 ounces, Gold Fields’ Lefroy with 414,590 ounces, Newmont’s Jundee with 411,000 ouncs and AngloGold Ashanti’s Sunrise Dam with 401,112 ounces.