It is hard to believe that a year ago the gold sector was on cloud nine because bullion was trading at a then-historic high $3700 an ounce.
It provided the perfect backdrop for a golden 2024 Diggers & Dealers Mining Forum in Kalgoorlie-Boulder – and chatter of peak gold.
Little did we know.
As 2,000 miners, investors, contractors, professional services providers and media descended onto Kalgoorlie-Boulder last night ahead of today’s opening of Diggers & Dealers 2025, bullion was nudging $5200/oz.
How much higher can it go?
Welcome back to Australia’s gold capital.
Rarely in the three-decade history of this three-day mining talkfest on the edges of the Nullarbor has gold more emphatically claimed pole position as everyone’s favourite metal.
Yes, compared to last year a few green (pun intended) shoots have emerged for critical minerals like lithium and rare earths and, yes, investor demand for quality copper stocks is strong.
But nothing rivals interest in gold.
And it would have dominated conversation last night not just at the Royal Flying Doctor Service fundraiser run by Topdrill (which is drilling a fair few holes for gold companies) in its yard in West Kalgoorlie but also in the pubs up and down the main strip as the visitors from the big smoke celebrated their arrival in the place made famous Paddy Hannan and his crew more than a century ago.
There might’ve even been a bit of chatter about Flagmantle after the Fremantle Dockers beat Carlton in Perth yesterday.
I digress.
Yesterday morning, a group 70 investors and media travelled from Perth to visit Northern Star Resources’ (ASX: NST) KCGM operations in Kalgoorlie.
Everyone made the trip – and didn’t accidentally board Rio Tinto’s family day flight to the West Angelas iron ore mine in the Pilbara (though that would have been fun). And they came well-briefed.
Many of them had spent the week visiting the operations of Vault Minerals (ASX: VAU), Ramelius Resources (ASX: RMS) and Bellevue Gold (ASX: BGL) – some also went to PLS’ (ASX: PLS) Pilgangoora lithium asset in the Pilbara and enjoyed a scenic bus ride from Wodgina back to Port Hedland following a plane breakdown.
Blast from the past:
- In 2015, the Digger of the Year was OceanaGold while the Dealer of the Year was Tony Poli (for selling Aquila Resources for a mootza).
- Twenty years ago, in 2005, the Digger was Jubilee Mines and the Dealer was BHP Billiton (for buying WMC).
- Isn’t it a different world today?
Anyway, as has been the case the past few D&Ds, KCGM was the only substantial Sunday site visit.
Long gone are the days when a plethora of D&D presenting companies used the opportunity to ferry a captive audience to their mine site en route to Kalgoorlie.
But then again few mines rival KCGM, comprising Super Pit and the Mt Charlotte and Fimiston underground operations.
Northern Star has copped some stick from investors for not advancing production at KCGM as fast as forecast.
Having said that, with a mineral endowment of 39 million ounces in resource and 14Moz in reserve, and a massive spending program including expanding the process plant capacity from 12Mtpa to 27Mtpa, this is one asset with a clear runway to 900,000oz of annual production (FY25: 419,000oz).
So what to expect from D&D 2025?
Gold’s incredible 40 per cent jump (in Aussie terms) since last August has had a profound impact on the D&D program – and exhibitors in the marquee.
Long-term D&D sponsor The Perth Mint (Booth 81) will have a few millions worth of gold on display. And its D&D-favourite chocolate bars.
And for the punters, there is chatter the 2025 Melbourne Cup – made of WA gold – will make an appearance.
Overheard:
- “There is nothing worse than a site visit on the Thursday after Diggers.”
- Agreed. Our thoughts are with the site HSE lead who has to perform the breathalyser checks.
De Grey Mining and Spartan Resources, two of the gold stars of last year, have been gobbled up by Northern Star and Ramelius, respectively, for a combined $8 billion in scrip.
Gold Road Resources (ASX: GOR) is in the throes of being taken over by its Gruyere JV partner, Gold Fields (JSE: GFI) for $3.4 billion cash and on Wednesday will present at D&D for a final time.
It will mark the end of a D&D career that netted Gold Road the Best Emerging Company award in 2011 (for its Gruyere discovery) and Dealer award in 2017 (for selling 50 per cent of Gruyere and operator rights to Gold Fields). Gruyere is yet to live up to its world-class potential – maybe Gold Fields’ motivation will improve once it secures 100 per cent of the operation.
While gold M&A has dominated the headlines and flowed through to a plethora of smaller bulk-up deals – Genesis Minerals (ASX: GMD), Vault and Capricorn Metals (ASX: CMM) are good examples – the reshaping of the ASX Gold leaderboard has also allowed a new (or rebadged) gaggle of operators to fill the void.
Not that gold mining is easy.
Just ask Bellevue, ASX newbie Greatland Gold (ASX: GGP), Westgold Resources (ASX: WGX) and Ora Banda Mining (ASX: OBM), which have all struggled to meet market expectations and are trying to win back investor trust.
And they are no orphans, which is why much of the gold conversation will be about margin protection and – hopefully – enhancement given how sticky costs in the gold sector are.
Delivering a positive feasibility study at gold above $5000/oz is hardly a challenge. Delivering the promised free cash flow, however, is.
Westgold will be hosting investors on site later this week, as will Pantoro Gold (ASX: PNR) and Evolution Mining (ASX: EVN).
But for all this gold dominance, today will kick off – somewhat strangely – with uranium.
When the D&D organisers announced a shake-up of the opening day keynote presentation in favour of a panel discussion, their decision for a nuclear energy debate was interesting and topical.
The uranium price was moving and investor interest in yellowcake was strong.
That was then – today, the steam seems to have come out of the uranium story while the Trump 2 Administration has thrown its support firmly behind fossil fuels. Drill, baby, drill.
Overlay that with operational challenges experienced by the small handful of ASX uranium producers – both Paladin Energy (ASX: PDN) and Boss Energy (ASX: BOE) are due to present this morning – and interest among delegates is likely to be there, albeit for different reasons.
One does wonder what is happening to WA’s only approved uranium mine project, Mulga Rocks. Maybe Deep Yellow (ASX: DYL) will tell us tomorrow.
And few stocks have had the sort of D&D lead-up that Boss has, eh, enjoyed. Its stock has halved over the past week. And the boss of Boss has quit.
Speaking of and thanks to Trump, the rare earths players have a bit of a spring in their step though one swallow does not a summer make.
Lynas Rare Earths (ASX: LYN) is the only rare earths operator of note to present. Iluka Resources (ASX: ILU), which is building a rare earths refinery at Eneabba north of Perth courtesy of some significant taxpayer suppport, doesn’t do D&D.
But there will be a bounce in the step of some of the rare earths reps at Diggers, such as Northern Minerals (ASX: NTU) and St George Mining (ASX: SGQ).
Before we know it, 22 Day 1 company presentations will be done and dusted and the wheelbarrows laden with refreshments will be making their way around the D&D marquee to kick off the Clarke Energy Cocktail Party.
It means D&D 2025 is in full flight.
