Australia’s gold producers have capitalised on a surging price for the precious metal by delivering an all-time production record last year.
With 317 tonnes of gold in 2018, the companies broke the previous record of 314.5 tonnes, which stood for 21 years.
Australian gold production reached 81 tonnes in the December 2018 quarter, the third consecutive quarter where output exceeded 80 tonnes. The gold price averaged $1711 an ounce in the December quarter.
Surbiton Associates director Sandra Close said the record output in 2018 was worth $17.3 billion at the average spot price.
“It took 21 years to break the old calendar year record and the outlook for the near term looks positive, but of course there can always be surprises,” Close said.
“Following a fall to just 220 tonnes in calendar 2008, the industry has bounced back, helped in part by the weakening of the Australian dollar against the US dollar, as it has fallen from around parity to near US 70 cents in the last decade.”
Australia’s gold sector is well positioned to continue this record-breaking form. The Australian gold price has already hit an all-time record of $1876 per ounce (on February 20), Close noted.
Gold has so far averaged around $1820 per ounce in 2019, with the Australian dollar currently fetching around US 71 cents.
The sector will also see positive developments production wise on both sides of the country.
“On the production front, Gold Fields and Gold Road’s Gruyere joint venture, some 200 kilometres north-east of Laverton will start up mid-year,” Close said.
“Production is scheduled to ramp up to around 300,000 ounces (or some 10 tonnes) annually at full capacity.
“Fosterville (in Victoria) will become a significant producer in 2019, as Kirkland Lake has just announced its output should rise from around 350,000 ounces in 2018 to some 600,000 ounces in 2019.
“Its average grade was an extraordinary 40 grams per tonne in the December 2018 quarter.”
Newcrest’s Cadia operation in New South Wales was the largest producer in 2018 at just over 750,000 ounces, followed by Boddington, Western Australia at around 710,000 ounces.
“Super Pit output fell to just under 630,000 ounces for 2018, following the pit wall failure in May,” Close said.
“It dropped out of the list of the quarter’s top five gold producers for the first time since Surbiton began its quarterly gold survey over 25 years ago.”
Australia’s largest gold producers in 2018 were:
Operation Ounces Owner
Cadia 751,965 Newcrest Mining
Boddington 709,000 Newmont Mining
Super Pit 628,000 Newmont Mining (50%, Barrick Gold 50%)
Tanami 496,000 Newmont Mining
Tropicana 477,908 AngloGold (70%), Independence Group (30%)