A positive prognosis for the future of gold, despite the many problems, was highlighted at the recent Australian Gold Conference held at Burswood Convention Centre.
A positive prognosis for the future of gold, despite the many problems, was highlighted at the recent Australian Gold Conference held at Burswood Convention Centre.
While most speakers gave the thumbs up to the precious metal, Zurich Group global chief economist David Hale, in his keynote address, described the hedging market, lack of world class technology and old economy currency as placing a restraint on gold prices.
This was a view not always supported by other speakers.
Normandy Mining Limited chairman Robert Champion de Crespigny described the outlook for gold as being good, with most executives viewing the price as as likely to go up.
“It will take time, but the outlook is starting to look better,” he said.
“I think we can see things being positive now. So many people in the investment community don’t look at the tremendous number of positives coming through.”
Mr de Crespigny described the Washington agreement as a “definite watershed”, with growth in similar types of agreements likely.
“I am absolutely certain that this industry (sale of jewellery) is going to be a major player and contribute to the gold sector,” he said.
One problem identified by Mr de Crespigny was in reduced exploration expenditure, which he called a positive for costs.
The reality of the dot.com mania, he said, is that when the situation changed, as he expected it would, miners would have to work harder to attract investors.
Other issues challenging the industry included the environment and a lack of information.
Mr de Crespigny said it was important that producers ensured there was an understanding of what was happening behind the scenes for gold.
He believed that State governments should continue to fund the provision of ground data expressed concern that certain legislation passed by State and Federal Governments could impede progress.
Mr de Crespigny also commented that issues of native title continued to restrain growth in the industry.
On the positive side, he identified tremendous application of technology by mining companies, with economics being at the cutting edge of technology.
“The application of technology in our industry is going to be one of the major drivers,” Mr de Crespigny added.
He predicted improved sales of gold bar and jewellery as it became accessible to more people and said mergers were an excellent opportunity to create value.
Mining companies were talking about their breakthroughs, especially in labour practices, research and development and the sharing of infrastructure plans.
“To my mind this is possibly the biggest benefit I will take from the conference,” he said.
He felt it was a great tragedy and a waste to see a plethora of mines sitting so close together and not rationalising ideas and infrastructure.
“It is starting to change and people are starting to share and I think this is very exciting,” Mr de Crespigny said.
