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External Presentations and Publications:

Schodde RC, "Long term trends in gold exploration", Paper given at the NewGenGold Conference, Perth, November 2015.


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[1.34 MB]

This is the third time I have presented at this bi-annual Conference. It contains some useful tables which, when you compare with previous papers, allows you to get a sense of how quickly new discoveries get reported and how they grow in size over time.

The key messages in the latest paper /presentation is that:

  • The industry is extremely cyclical. As at 2014, global spending on gold is down 55% from its peak in 2012.
  • In terms of discoveries, Over the last decade Canada did well (at the expense of Latin America)
    • By number, 11% of the discoveries were in Canada, 11% in Australia and 30% in Africa
    • In terms of contained gold, 27% was found in Canada, 6% in Australia and 18% in Africa
  • The average size of discovery is falling (3.4 Moz in last decade versus ~5 Moz in 1980s and 1990s)
  • The depth of discoveries is gradually increasing over time.
    • Over the last decade the average depth of cover was 64 metres but half of the deposits found were outcropping (and most of these were in Africa). This suggests that the depth of cover issue is mainly a problem for mature countries (such as Canada, Australia and USA)
  • Unit discovery costs have progressively risen over time - from $14/oz Au-eq in the 1980s to $20/oz in the 1990s and $25/oz in 2000s. It is currently running at ~$60/oz
  • Discovery costs vary widely by Region the lowest was Canada ($31/oz) & Africa ($38/oz), and the highest was US ($71/oz) & Pacific SE Asia (>$300/oz)
  • In terms of Value/Cost (i.e. "Bang-per Buck") over the last decade the industry created $0.68 worth of value per each Dollar spent on Exploration. Hopefully this will improve over time as costs4 (between 2012 and 2014) is down deposits grow over time On this basis, the industry is currently struggling to sustain itself.
  • Over the last decade 51% of the total exploration expenditures were in High-Risk and Very-High Risk countries. These accounted for 49% of the discoveries by number, 37% of the ounces but only 33% of the value. This is a surprising result as one would expect a higher return to compensate for the higher business risk associated with exploring there

Given the above the industry is currently struggling to sustain itself. As a consequence the gold price has to rise (to stimulate more exploration and make more projects economic) or we have to either to be smarter/more efficient at exploration

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