Gold mining industry report points to worrisome trend

The growth experienced in the U.S. gold mining industry during the 1980s and early 1990s has levelled off, with the rate of production now reported at just under 11 million oz. per year.

Significant increases are not anticipated in the near future.

The Natural Resource Industry Institute, in its report on the industry’s performance in 1994, says the rate of new mine

development in the U.S. has slowed dramatically since the late 1980s. The report also notes that several small-to-medium-size mines have recently undergone closure and reclamation.

Despite this trend, expansions are expected at several major producers within northern Nevada’s Carlin and Battle Mountain trends. In addition, several development prospects are being advanced in Nevada, Alaska and other western states.

On the whole, however, gold mining in the U.S. is becoming

increasingly international in scope, and the study suggests this is a reflection not only of the fact that the domestic industry has matured, but also of proposed legislative and regulatory changes that would affect operations in that country. As examples of these changes, the study cites the increasingly unfavorable regulatory climate, as well as proposals to reform the Mining Law.

To justify their position, advocates of reform continue to point to past examples of environmental damage. The study notes,

however, that evidence is mounting that the future of the

industry is being jeopardized by the environmental lobby.

More and more American companies are exporting their exploration dollars to projects in other parts of the world. As a result, an increasing number of new gold mines will be off shore, which raises questions about the long-term viability of the domestic industry.

A survey of 22 American companies shows that they spent $3.6 billion on exploration and development between 1992 and 1994. Of this total, $1.4 billion was spent in the U.S., while 61% was spent in other countries.