‘We Found It All’: Goldcorp Says Mining Reached ‘Peak Gold’; Prices To Hit $1,600
(Kitco News) - All major gold deposits have already been found, said Goldcorp chairman Ian Telfer, adding that mining production can only go downhill from here.
“We’re right at peak gold here,” Tefler told the Financial Post on Wednesday. “Gold produced from mines has gone up pretty steadily for 40 years. [But], this year [or next] it will start to go down, or it’s already going down.”
The dwindling production will boost gold’s prices in the long-run, according to Telfer, who is very bullish on gold despite a recent drop below $1,300 an ounce — a very critical resistance level for the precious metal.
Telfer said he sees gold prices heading all the way up to $1,500 or $1,600 an ounce by the end of this year.
Gold prices tumbled more than 2% on Tuesday, hitting this year’s lowest levels on strengthening U.S. dollar index that climbed to a five-month high. As Asian markets opened on Thursday, spot gold on Kitco.com was last trading at $1,291.10, up 0.07% on the day, and June Comex gold futures were at $1,291.00, down 0.04% on the day.
The argument of peak gold has been gaining support within the mining industry. The World Gold Council (WGC) said in September that annual global gold production will not be able to exceed current levels in the future.
For Goldcorp, production has been on the decline since 2015, when the output was at 3.4 million. In 2016 and 2017 the company produced 2.8 million and 2.5 million respectively.
“Are we not looking for it? Are we bad at finding it? Or have we found it all? My answer is we found it all. At US$1,300 (per ounce of) gold, we found it all. I don’t think there are any more mines out there, or nothing significant. And the exploration records indicate that,” Telfer said.
Goldcorp chairman added that the average grade of newly discovered gold deposits has been dropping, which means mining companies will need to invest in new technologies when it comes to future gold extraction.
Telfer said Goldcorp is already using some new techniques when sifting through its exploration data, including the IBM Watson program, which helps with analysis.