MELBOURNE based Surbiton Associates, one of Australia�s leading followers of the gold sector, have pointed out that output from one of the world�s largest gold producers at 251 tonnes is currently at its lowest level achieved during any financial year in the past decade. Australian gold production peaked as far back as 1998, and while there have been occasional quarterly increases between then and now, the overall production trend has been steadily downwards.

The decline is attributed to a continuing lack of exploration expenditure in the sector in favour of the search for other metals and minerals. Most of the new production which is coming on stream, but failing to make up for reserve depletion, is through re-opening of old mines and old projects long in the pipeline as well as plant expansions brought on by the current high gold price. In other words some of this is a short term gain which could just as easily evaporate if the gold price falls back.

Indeed, the main reason Australian production managed to remain within 5% of the previous 2004/2005 financial year was due to the opening of Barrick�s Cowal mine and much improved production at Newcrest�s Telfer operation (Australia�s largest producer in the June quarter) and AngloGold Ashanti�s Sunrise Dam. Clearly gold exploration Australia needs a shot in the arm if gold output is to climb back to its peak.