Gold output steady Down Under

Australian gold production showed only a small increase in the three months ended March 2005, according to a new report.

The Australian Gold Quarterly Review, compiled and published by Melbourne-based Surbiton Associates, says gold production in the country totalled 67.3 tonnes in the first quarter, up a mere 1.4% over the 66.4 tonnes produced in the previous 3-month period but 4.3% higher than in the first quarter of 2003, due to several cyclones that curtailed production at that time.

Production gains at Australian-listed Newcrest Mining’s Telfer and Cracow gold operations, as well as a new treatment plant at Gold Fields’ St. Ives/Lefroy operation in Western Australia, combined to add 4 tonnes of new production, which was offset by lower output several other operations, including Newmont’s Granites-Groundrush, Placer Dome’s Kanowna Belle, Giants Reef Mining’s Chariot, Croesus Mining’s Norseman, and Wheaton River Minerals’ Peak.

There were no plants shuttered during the quarter and no weather-related issues to report.

The recent federal budget in Australia failed to provide exploration incentives that could lead to further discoveries. Australia also faces congestion issues at many seaports, though this does not affect gold mining.

“Most people don’t realize Australia’s annual gold production could be flown out of the country in just three Boeing 747s,” says Sandra Close, managing director of Surbiton. “That would be unlikely with such a valuable commodity, but clearly gold has big transport advantages compared with bulk commodities.”

In 2003, Australia overtook the U.S. to become the world’s second-largest gold-producing country after South Africa. Australia is on course to claim the top spot in about five years as South Africa’s strengthening rand thwarts further expansion.

— The preceding is from an information bulletin published by Melbourne-based Surbiton Associates.