COMMODITY CAPERS: Hump day arrived this week bringing with it a gold price of US$2,473.40 per ounce, giving gold producers and explorers alike something to smile about.
With his recently pinged right ear bandaged up for his arrival at the Republican Party love-in, prospective POTUS, Donald Trump could be given some credit for the spike in the most precious of metals’ pricing.
Gold has received quite a bit of attention of late, mainly due to a concerning rise in geopolitical tensions.
The concerns have resulted in renewed consolidation of its ‘safe haven’ status with it being a physical, relatively scarce asset that has historically held its value in times of global uncertainty.
Trump’s obfuscation over America’s support for The Ukraine in the Russia Ukarine war and his prior pacification of Russia – and by extension its leader Vladimir Putin – over the suspected Russian interference in his 2016 election have gold buyers forming queues around the world looking to shore up a secure store of value.
Gold has been on a healthy run, averaging about US$2,200 an ounce in the first half of 2024, up 15 per cent year-on-year due to strong demand from investors and even more from central banks.
Central bank buying has been at historic highs over the past two years, which has continued in 2024.
If you guessed China is the leading central bank gold purchaser, then you move one step away from The Chaser.
“China is the leading central bank gold purchaser in a move many see as part of the trend towards “de-dollarization” i.e countries distancing themselves from the USD as the global reserve currency,” Shaw and Partners noted in it’s the Research Monitor September Quarter 2024 report.
“Chinese consumers have flocked to gold as their confidence in investments like real estate or stocks, that have traditionally performed well, has faltered.”
The bean counters at the Office of the Chief Economist have forecast gold prices to remain elevated throughout 2024 and 2025, before easing slightly in 2026.
This, it said in the Department of Industry Science and Resources June 2024 Resources and Energy Quarterly rolled on the back of a year-on-year four per cent decrease in Australian gold production in the March quarter 2024, due to lower grades and disruptions from heavy rainfall.
“Production is forecast to grow over the outlook period as major new projects and expansions come online,” DISR said.
“Gold export earnings are expected to reach a record $33 billion in 2023 24, easing to around $31 billion in 2025–26 as prices gradually decline from record levels in Australian dollar terms.
Shaw and Partners identified that although the gold price climbed in 2023, funds raised by junior and intermediate gold companies continued to decline for the second consecutive year.
“Unlike major producers that self-fund their exploration, juniors heavily rely on capital markets to fund their programs,” Shaw and Partners said.
“In the past three years, junior companies accounted for more than 50 per cent of total exploration budgets.
“Constrictive market conditions for gold consequently reduced the exploration budgets in 2023 by 16 per cent YoY to US$5.9B with IR related exploration budgets declining 19 per cent YoY to US$2.5B, the lowest since 2020.”
This hasn’t stopped some juniors from making an impact.
Great Boulder Resources (ASX: GBR) has been busy of late at the company’s Side Well gold project near Meekatharra in Western Australia.
The company most recently announced having identified two new large, high-priority gold targets at the Side Well gold project via soil auger sampling.
The first is a 2.4 kilometres-long Ironbark-style target with peak gold values of 75ppb gold with the second being a 1.4km-long bismuth-molybdenum anomaly, displaying the same pathfinder elements as Mulga Bill, including bismuth assays up to 475 times background levels.
“We recently completed a program of wide-spaced surface sampling over the Side Well South area, extending coverage to the bottom of the Side Well project,” Great Boulder Resources managing director Andrew Paterson said.
“This data has confirmed mineralisation continues south through our tenements and the known hydrothermal system now covers more than 18 kilometres of strike.
“At Side Well South we’ve identified two new targets collectively spanning 3.8 kilometres of strike.”
The company had earlier completed aircore (AC) drilling at the project’s Mulga Bill North target that added definition to gold mineralisation approximately 500m north of the Mulga Bill resource envelope.
The company explained on announcing results that the program is part of an ongoing process it is carrying out to identify and define additional gold mineralisation to expand the existing 568,000 ounces gold Mulga Bill Mineral Resource.
Highlights include:
24SWAC214
12m at 2.61 grams per tonne gold from 88m, including 4m at 4.27g/t gold from 93m;
24SWAC216
4m at 5.03g/t gold from 84m and 3m at 2.31g/t gold from 112m;
24SWAC211
3m at 2.68g/t gold from 114m; and
24SWAC220
9m at 1.95g/t gold from 100m.
Earlier drilling at the northern end of Mulga Bill, resulted in Great Boulder claiming discovery of a new shallow high-grade vein extending approx. 150 metres north of the Side Well JORC Mineral Resource of 7.45 million tonnes at 2.8 grams per tonne gold for 668,000 ounces of gold.
Highlights from the recent campaign include:
24MBRC001
32 metres at 8.38 grams per tonne gold from 104m, including 18m at 13.76g/t gold from 104m;
24MBRC002
16m at 2.12g/t gold from 108m, including 4m at 5.68g/t gold from 108m; and
24SWAC194
26m at 3.31g/t gold from 88m, including 8m at 10.02g/t gold from 88m.
The new vein discovery at Mulga Bill extends into Mulga Bill North, where drilling has defined gold mineralisation over 1.5km of strike.
“This is an extremely exciting development at Mulga Bill, with the discovery of a thick high-grade vein immediately north of the current Mulga Bill resource,” Paterson said.
“Our drilling has defined it over 150 metres of strike, with indications that it could extend 350 metres or more.
“This new discovery connects the Mulga Bill and Mulga Bill North prospects.”
Mt Malcolm Mines (ASX: M2M) is making solid progress at the company’s Golden Crown gold prospect in Western Australia.
The company has carried out activities with the aim of establishing the feasibility of wet gravity processing at a nearby third-party plant while assessing the mineability of the shallow high-grade ore at the prospect.
A Reverse Circulation (RC) drilling program completed earlier this year outlined a well-defined mineralised area, which the company considers a solid foundation for robust maiden Mineral Resource Estimates.
The RC drilling produced the highest recorded intersection for Golden Crown of:
24GCRC060
6 metres at 24.46 gras per tonne gold, including a broad high-grade zone of 10m at 15.4g/t gold.
Other high-grade intercepts included:
24GCRC032
4m at 3.29g/t gold (20-24m);
24GCRC033
4m at 5.23g/t gold (22-26m);
24GCRC048
3m at 6.88g/t gold (0-3m); and
24GCRC059
4m at 4.43g/t gold (14-18m).
The drilling entailed 18 shallow grade control drillholes along three designated lines, within an area designated to support bulk sampling testwork that is hoped to demonstrate the economic viability of processing of upcoming bulk samples in the wet gravity plant, offering crucial insights into resource development potential.
“The primary objective of the Golden Crown bulk sampling work is to enhance our understanding of the ore’s geological properties, such as grade variance, metallurgical characteristics, and future mineability,” Mt Malcolm managing director Trevor Dixon said.
“This information is crucial for our future planning of efficient and cost-effective mining operations.
“The bulk samples will assist in verifying gold grade and continuity at Golden Crown whilst also evaluating the feasibility for any potential future mining operations that can provide a saleable gold product to the company.”
