Australia’s 2021 gold output falls as pandemic bites
miningweekly.com
7th March 2022
By: Creamer Media Reporter
Australian gold production in 2021 totalled 315 t, or 10.1-million ounces, according to Melbourne-based gold mining consultants Surbiton Associates.
This was lower than the peak production in 2019 and 2020, but only two tonnes lower than in 2018.
Australia is the second-biggest gold producing country in the world after China. Local gold output for the first half of the 2021 year was slightly ahead of China, but this was not sustained later in the year, so Australia remains in second place.
“Compared with 2020, Australian gold production in 2021 declined by 12 t or 4%,” said Surbiton Associates director Dr Sandra Close. “There are a number of factors which have contributed to the fall, many of which are a result of the pandemic.”
Western Australia, which produces around three-quarters of Australian gold, closed its borders in mid-March 2020 to restrict the spread of Covid-19. Its border was not finally reopened until last week.
“Although the gold producers continued to operate extraordinarily well under the circumstances, the restrictions imposed due to the pandemic have had an increasing impact,” Close said. “Personnel shortages and burn-out have been taking a toll and this year production has been negatively affected.”
The availability of fly-in, fly-out workers from other states has been particularly limited. There has also been a shortage of haul truck drivers, plus shortages of some supplies and disruption to interstate haulage. Assay laboratories, for example, are just one of the many service industries also affected, with a substantial increase in the turn-around time for sample analysis.
“A consequence of the shortage of haul truck drivers is that there has been a restricted supply of higher-grade ore at some processing plants,” Close said. “This has placed a greater reliance on the treatment of lower grade stockpiled material.”
Close said this appears to have been a contributing factor to the lower overall gold production for the 2021 year.
“Fortunately, during 2021 the gold price in Australian dollar terms trended upwards, although it was relatively flat in US dollar terms,” Close said. “The 315 t of gold produced in 2021 was worth around A$25.5-billion at the average price for the year, which was a substantial contribution to Australia’s exports.”
When Russian President Vladimir Putin ordered Russian military forces to invade Ukraine on February 24, gold prices rose sharply.
“The gold market thrives on uncertainty,” Close said. “It is not really surprising to see buoyant gold prices at present, given the huge concerns regarding the situation in the Ukraine, as well as rising inflation in the US and elsewhere.”
“In the September quarter, several producers had operational difficulties,” Close said. “However, in the final quarter of 2021, Australian gold mine production rose by 4% to 81 t.”
Newmont’s operations at Tanami and Boddington both increased production by about 1 t, or about 32 000 oz each, in the December quarter. Northern Star’s Super Pit production was up 22 500 oz and Gold Fields’ St Ives output increased by 16 500 oz.
By comparison, production at Kirkland Lake’s Fosterville operation in Victoria was down about 26 600 oz for the December quarter, mostly owing to lower throughput. In February, fellow Canadian company, Agnico Eagle Mines completed the takeover of Kirkland Lake Gold.
“Despite the problems, exploration activity for gold, lithium minerals, rare earths and base metals, continues apace,” Close said. “Activity in the mining and resources industry is the strongest I’ve seen for years. A steady stream of announcements continues to flow into the Australian Securities Exchange, including reports on new discoveries, drilling results, capital raisings and initial public offerings.” |
