In the wake of the Western Australian Government’s 50% gold royalty hike, WA gold miners are working overtime at the Denver Gold Forum this week drumming up investor appeal for their operations.
The gig for WA gold producers gets even tougher after an ASX spokesperson yesterday informed the Australian it would forcibly suspend all affected gold stocks from trade until they reported the impact of the inflated figure on the economics of their operations.
However, this would only occur if the proposed royalty hike made it to parliament.
Based in the US, the Denver Gold Forum is the world’s largest gold miner and investor platform and the proposed hike has made international news and made investors jittery.
Chamber of Minerals and Energy of Western Australia chief executive officer Reg Howard-Smith said WA gold miners had “a hard sell this week” at the event.
“There is a very real prospect international investors will decide to ignore Western Australia for future investment and pursue gold opportunities elsewhere,” Mr Howard-Smith added.
“At a time when the global gold sector is facing rising operating costs, the last thing companies, their staff and investors need is a crippling increase in the royalty regime.”
WA gold miners presenting at the forum include: Newmont Mining, Barrick Gold, Newcrest Mining, Gold ields, AngloGold Ashanti, Northern Star Resources, Evolution Mining, Superior Gold, Blackham Resources, Westgold Resources, Ramelius Resources, Gold Road Resources, Saracen Mineral Holdings, St Barbara, Regis Resources, Independence Group and Doray Minerals.
Flow on impact of proposed royalty hike
When the Western Australian State Government delivered its 2017-18 budget in early September, it caused an uproar in WA’s gold mining sector.
Under the budget’s proposals, WA gold miners would be slugged with a royalty increase of about A$20 per ounce once the rate was jacked up from 2.5% to 3.75%. This would kick in when the gold price is at A$1,200 per ounce or higher.
In response to the increase, more than a thousand gold workers took to Kalgoorlie streets as part of an industry-wide protest.
Mr Howard-Smith has called on the WA Government to find a better way to fix the budget, adding the royalty rise would result in mine closures and cause industry-wide job losses.
“More than 25,000 men and women work in our gold mines and many more work in industries associated with the gold sector – from drillers to geologists to truck drivers,” he added.