Loading ...Peak Gold
Although I may not be the biggest fan of Goldcorp, their outgoing CEO, Chuck Jeannes has been harping on peak gold production in 2015. All one has to do is look at Barrick’s outlook released with their earnings tonight to see some confirmation of this thesis. They produced over 6 million ounces in 2015. Again, if the price of gold goes much higher, these numbers will probably change, but just look at the massive forecasted decline in production from the biggest producer in the world.
OUTLOOK
In 2016, we expect to produce 5.0-5.5 million ounces of gold at all-in sustaining costs of $775-$825 per ounce.
For 2017, we expect to produce 5.0-5.5 million ounces of gold at all-in sustaining costs of $740-$790 per ounce.
In 2018, we expect to produce 4.6-5.1 million ounces of gold at all-in sustaining costs of $725-$775 per ounce.
Our aspiration is to achieve all-in sustaining costs below $700 per ounce by 2019.
Based on our current asset mix and subject to potential divestments, we expect to maintain annual production of at least 4.5 million ounces of gold through 2020.
Good Point Cash
This is a very overlooked Fundamental
Thanks
My reckoning is that the price will go higher to maintain supply…………… just as you say Sir Cc “these numbers will probably change”. POG @ 50% more than it is today will pull plenty more gold from resources to reserves. It’s not that we’re short of gold below ground; it just that it doesn’t pay, in many situations, to dig it up ATM.
Peak gold is a marketing ploy – new gold supply is proportional to price. One more trip to the out house and then it will begin to pay to dig. We got brain washed with Peak Oil for so long, to keep price ramped up I reckon. Hardly hear a peep from Peak oilers now that producers are selling their ‘non-renewables’ at 20% of peak prices.
One can only hope that the majors show some discipline this time around… I’d personally rather own a Barrick Gold producing 4.5 million ounces at 700 AISC at Gold 1500 than Barrick Gold producing 9 million at a cost of AISC 1200. Let’s just hope they have learned.