02 Aug Gold Mining Trends In BC
By Grant T. Smith
There it is.
Hidden in a small article.
On the third page of the Globe and Mail – Report on Business, on the 26th day of July, 2018 is the article that I have been watching for:
“Newmont Mining Corp., which topped Wall Street estimates for quarterly profit, said on Thursday it would acquire a 50-per-cent stake in a gold project in Western Canada as miners look for new reserves.
Major gold miners are racing to explore, expand and construct new mines as years of belt tightening have left them with diminishing reserves at their existing mines.”
Let the bells ring:
- We have recognized that gold reserves are depleting;
- Newmont, along with others, has started to acquire projects to build new reserves;
- British Columbia is seeing the benefit.
I am also pleased that the announcement came when gold is still well below the spring peaks (when gold flirted with $1,350 per ounce), for this indicates a willingness to invest while the price is soft.
Over the past year or so, we have witnessed incredible investment in two areas: marijuana and crypto-currency. I understand investing in the former, as legalization opens tremendous new markets, even if I would steer clear of it until the market settles (depending on a personal risk threshold). Crypto-currency markets make very little sense to me.
I mention these areas because they are the market areas that have been drawing in speculative or risky investment dollars, dollars that previously supported the exploration mining sector.
For many years, the exploration mining world has languished underfunded to explore and develop new resources and the sector has missed the speculative investor. Probably two years ago now, I started talking about the need to develop those resources and the upward pressure this would put on metal prices.
Then we waited.
We are still waiting. Does this small notice precede a wave of exploration? Will speculative investment dollars flow back in to the sector when the full realization of dwindling reserves gets recognized. Probably not, but if it does, I want to be on the record.