(Kitco News) - Gold’s climb above $3,000 an ounce is triggering a wave of consolidation in the mining sector, with a flurry of high-profile deals in Australia and growing political momentum in the U.S. to revive domestic mineral production.
Neil Adshead, consultant analyst at the Commodity Discovery Fund, told Kitco Mining that the market is entering a new phase where cash-rich producers are aggressively pursuing growth – and not always on the cheap.
“We are going to see more and more of these smaller companies get picked off by the big boys for sure,” Adshead said in an interview with Kitco’s Senior Mining Editor and Anchor Paul Harris.
Recent transactions include Ramelius Resources’ A$2.4 billion acquisition of Spartan Resources, followed by Gold Fields’ A$3.3 billion bid for Gold Road Resources – its joint venture partner in the Gruyere gold mine. Gold Road rejected the offer, calling it “opportunistic,” and then countered with a bid for Gold Fields’ 50% stake.
Adshead noted the strategic shift underway. “Gold Fields… went through a phase of having lots of JVs and now they seem to be wanting to collapse these JVs… which is the safest and easiest M&A you can actually do,” he said.
Trump order sparks mining debate
In the U.S., President Donald Trump’s recent executive order – Immediate Measures to Increase American Mineral Production – is drawing praise and skepticism in equal measure. The order calls for expedited permitting of critical minerals, including uranium, copper, potash, and gold, citing national security and military readiness concerns.
“It seems like it’s really driven by… a U.S. national security initiative,” Adshead said. “It’s almost like the Americans are planning for war, so to speak.”
But Adshead warned that the impact may be limited given the long timelines and legal hurdles typical in U.S. mine development.
“If you brought on a copper mine in the last five years, the average time from discovery to production is 17 years,” he said, referencing a chart from Aris Mining. “This three-to-four-year window of support from the federal government… I’m not really sure that’s going to make directors go giddy and sign billion-dollar checks.”
Adding to the uncertainty, Trump is reportedly considering a 25% tariff on copper imports, which has widened the pricing gap between U.S. and global exchanges. “Really a tariff… is just a tax,” Adshead said. “You just generally make people poorer over time.”
Canada responds
Canada’s government, facing its own election in April, announced reforms to streamline mine permitting and launched the First Mile Fund to improve infrastructure around resource projects. Adshead believes Trump’s moves have lit a fire under Canadian policymakers.
“Trump’s words… created a little bit of Canadian nationalism,” he said. “How can we make ourselves wealthier? How can we develop our own industry?”
New Found Gold falls flat
Meanwhile, a much-anticipated maiden resource estimate from New Found Gold for its Queensway Project fell short of investor expectations, sending the stock tumbling more than 30%.
Still, Adshead sees potential. “It could be a decent mid-sized gold mine one day,” he said.
Despite headwinds in permitting, investor fatigue, and geopolitical uncertainty, Adshead remains cautiously optimistic. “The gold price helps… the board realizes you need growth in any company,” he said. “And that’s where M&A starts to heat up.”
Subscribe on Apple Podcasts, Amazon Music and Spotify. You can also add the RSS link to your favorite podcast player: LINK