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Gold miners could profit from a cashless society

Part of the group’s success through the year was based on the exceptional margins achieved at its tailings operations, with the Elikhulu and Barberton sites recording all-in sustaining costs (AISC) of $708 and oz and $643 an oz, respectively. Those figures are well down on the overall AISC recorded by the group, but it could be argued that industry-wide improvements to the ways in which gold is extracted from mining waste materials – and the increased commercial importance attached to them – reflects the general fall-away in mining grades in the industry.

One of the most noticeable features of Petropavlovsk’s (POG) full-year production update, published in January, was the improved extraction rates through its processing plants set against the fall in average grades – the amount of gold that can be extracted per tonne – across its mining operations. It is to management’s credit that the Russia-focused miner continues to drive efficiencies, although short of any major technical advance, a lower-grade environment may be the new normal for gold miners.

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