PERTH (miningweekly.com) – Australian gold production hit a record 321 t in 2018/19, worth some A$23-billion at current gold prices, gold mining consultancy Surbiton Associates reported.

The 2018/19 gold production record compared with the 310 t produced in the previous corresponding period and the 317 t produced in the 2018 calendar year.

Gold production in the June quarter reached 82 t, making it the highest quarterly production for more than 20 years, said Surbiton director Dr Sandra Close.

“The outlook for Australian gold production seems positive. However, many things can happen, I can’t predict the future and am very conscious of the many factors and uncertainties that affect gold prices, exchange rates and production,” Close said.

She noted that the star performer for the year was Newcrest Mining’s underground Cadia operation in New South Wales.

“Cadia produced over 910 000 oz, or some 28 t, of gold in 2018/19, well ahead of Newmont Goldcorp’s Boddington, Australia’s second largest mine, at around 690 000 oz, or 21 t. Both these deposits contain some copper as well as gold.”

Joining the list of producers in recent weeks was the large Gruyere operation in Western Australia, owned equally by Australia’s Gold Road Resources and South Africa’s Gold Fields. Gruyere, which cost some A$620-million, will produce around eight tonnes of gold a year when in full production.

At the other end of the scale, Beacon Minerals' small Jaurdi project south-west of Kalgoorlie, is now in production and will add more than one tonne of gold a year.

“Higher production is also expected from Royal Nickel’s operations at Beta Hunt and its newly acquired Higginsville plant in Western Australia, while Kirkland Lake’s Fosterville mine, in Victoria, continues to build up output to around 600 000 oz of gold in 2019,” Close said.

The Fosterville mine has reported an extraordinarily high grade, averaging 39.9 g/t gold for the June quarter, which is almost 1.3 oz/t, more akin to the grades seen in some of the famous old mines over a century ago.

“Of course, while several operations are faring well, there are also some who are struggling and at the other end of the cost curve. The recent new development at Dalgaranga, with its low grade material, has proved to be a disappointment.”

Turning to the Victorian government’s recent announcement that it would impose a royalty on gold production,  Close said it appeared that it had not been properly thought through.

“Let me stress that I am in favour of royalties on the production of minerals which are owned by the people of the state. However, royalties are an additional cost burden on production and need careful and sensitive consideration, to ensure the outcomes are of overall benefit.”

She said the action by the state government will do nothing to enhance Victoria’s reputation as a great place to explore and mine and that it is unfortunate that the lack of consultation resulted in such a negative message being sent, as Victoria could well do with a more vibrant resources industry.

“While I appreciate Victoria has not imposed a gold royalty to date, to announce its imposition without warning was difficult to understand. Despite its illustrious past Victoria has only a small gold mining industry today, much of which is in need of encouragement and support rather than a sudden impost, if regional jobs are to be maintained.”