There are hundreds, if not thousands of old abandoned gold mines in the United States. Many still contain veins of gold. the question is, can a mine produce a profit from these veins. One of these old sites is Rise Gold. In 2017 a corporations bought the old mine because they believed it meant economic sense. The mine last produced gold in 1956. But due to the fact that gold had a fixed price ($35) set by the U.S. government, it made little sense to continue operations.
Day to day expenses associated with operations exceeded the price per ounce of gold. It is easy for us today to see that gold at $35 an ounce wasn't much to compensate a mining company what with labor costs, machines costs, regulation costs, and the cost of borrowing money.
Now conditions have changed. We have experienced a pandemic, rising inflation, and the uncertainty of Fed policy. Having lowered interest rates, the Fed has helped the lure of gold (and silver) and increased interest in the precious metals. In 2020, roughly 43 percent of gold consumed globally went towards exchange-traded funds and central banks. Hmmmm.... central bank purchases you say? Mining technology is not static.
Those associated with it are endlessly pursueing tech that will lower the cost of mining. Many mines once thought to be worthless are being examined again. This is a story repeated throughout history.
Of the world’s known gold, roughly 63,000 tons is still in the ground, compared with roughly 206,000 tons that havs been mined, this according to The U.S. Geological Survey. Of the gold left (and in mines that have formerly been abandoned), miners must deal with digging deeper in the ground, at good expense, and then must figure out what to do with tailings, the waste. The waste can frequently contains toxic metals.
If you are interested in this new mining story, please see this link for more information:
https://www.theatlantic.com/science/archive/2022/01/gold-mines-reopening-california/621403/
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