Gold exploration in Queensland rose 21 per cent last year as resource companies looked to cash in on favourable market conditions.
Queensland Resources Council chief executive Ian Macfarlane said the amount spent on gold exploration statewide in 2017-18 was $61.7 million, compared with $51 million in 2016-17, in the face of strong demand for the precious metal overseas.
“Currently the gold price is around $US1200 an ounce, which means Australian producers would receive an extra 30 per cent on the spot price with the currency difference and this is one of the reasons why we’re seeing gold producers looking to expand their mines,” he said.
Evolution Mining announced in October that it had the green light from its board for a $60 million underground development, pit cut-back and relevant plant modifications at the Mt Carlton gold operation in North Queensland.
Meanwhile Minjar Gold is planning to develop a new decline at its Pajingo gold mine near Charters Towers, where it has recently brought a number of small open- pit operations online to add to its main underground production stream.
Resolute is continuing to progress its $300million-plus Ravenswood Expansion Project, which has seen the company establish a 13-year mine life for local gold operations based on a return to large-scale open pit mining at the Nolans East, Buck Reef West and Sarsfield deposits.
Among other movements in gold in 2018 was the start of production at the Lorena gold project near Cloncurry, while Round Oak Minerals kicked off the Wallace South gold development after investing in upgrades at its Cloncurry processing plant.
Fat Prophets resource analyst David Lennox said Australian gold miners had benefited from a weak Australian dollar against the US.
“That has helped our gold mining industry no end,” he said. “What we are seeing is that gold production in Australia has improved and that is primarily because it is still worthwhile for Australian gold producers to mine gold.”
Fat Prophets expects inflationary pressures to push gold prices higher in 2019.
“The other thing you need to look at is the cost of production and miners have put a lot of effort into getting their costs down. In Australian dollar terms the margin has probably improved as they have reduced costs and have a better Australian dollar price,” Mr Lennox said.