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(Kitco News) – &lsquo,Real caution&rsquo, is advised when it comes to Australia&rsquo,s latest gold rush, according to Melbourne-based gold mining consultants, which say that only time will tell if any of the fresh ventures pan out.
&ldquo,It is good to see such rente ter gold exploration locally but real caution is needed,&rdquo, Sandra Close, managing director of Surbiton Associates, said ter a release published on Sunday.
&ldquo,It is very early days and despite the publicity, there is a fine difference inbetween an exploration play and a successful mining venture. Exploration is a risky and expensive business,&rdquo, Close noted.
All the hype around the gold rush te Western Australia&rsquo,s Pilbara region is understandable spil more than 25 publicly listed companies are scouring the region for gold, the media release pointed out.
&ldquo,The target is gold that occurs ter conglomerates &ndash, sedimentary rocks composed of rounded pebbles te a finer grained matrix. Rocks of a similar type and age ter the Witwatersrand basin host the major gold deposits which have bot the source of much of South Africa&rsquo,s wealth for more than 100 years,&rdquo, Close explained.
Significant to keep ter mind is that Pilbara wasgoed already tested for similar deposits te the late 1970s and the very first half of the 1980s by one of Australia&rsquo,s distinguished mineral explorers, Mark Creasy, who found that the &ldquo,overall grades were too low to support economic development.&rdquo,
&ldquo,Despite the parallels, the latest search te the Pilbara should be kept ter perspective … Thesis types of occurrences involve one of the classic challenges of sampling, the problem of the &lsquo,nugget effect&rsquo,,&rdquo, Close said.
The &lsquo,nugget effect&rsquo, refers to assumptions made by explorers when sampling an area &mdash, finding or not finding a nugget ter the sample sometimes leads experts to a wrong conclusion about the actual mineral composition of the land.
&ldquo,Dealing with the &lsquo,nugget effect&rsquo, is an expensive and time consuming business,&rdquo, Close pointed out. &ldquo,Such exploration involves collecting and processing a large number of large samples ter order to obtain reliable results.&rdquo,
Overall, gold production te Australia remained &ldquo,relatively constant&rdquo, te Q3, totaling 74.1 tonnes, which is 1.4% less than ter the previous quarter. &ldquo,It wasgoed the usual case of swings and roundabouts,&rdquo, Close said.
Surbiton Associates also discussed Western Australia&rsquo,s failure to introduce a 50% increase te gold royalty for the 2nd time, noting that there is a lack of understanding around the effects of cost increases.
&ldquo,I am all ter favor of a fair comeback to the community for the mining they own,&rdquo, Close said. &ldquo,But it makes little sense to increase the royalty so that the economic cut-off grade rises and gold is left ter the ground that wasgoed previously economic to mine.&rdquo,
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