Major developments in the gold mining industry of the United States

Abstract

The domestic gold mining industry has changed substantially as production has increased sharply since 1980. This thesis seeks to review the fundamental economic and technologic changes contributing to increased production and to present an analysis of the components of present mine supply. The sustained higher gold price in real terms has been the driving force behind rapidly increasing domestic gold production. Developments in open pit mining methods, heap leaching technology, and carbon-in-pulp technology have contributed to lower production costs. Higher prices and lower costs have resulted in very attractive profit margins, enabling the industry to raise substantial capital to develop new mines through equity offerings and gold loans. Numerous discoveries of large-tonnage, low-grade deposits in the Western United States, particularly Nevada, have resulted in many major mines commencing production since 1980. Nevada has rapidly become the dominant gold producing state, providing nearly 56% of total domestic output in 1987. The Carlin trend in northeast Nevada is now recognised as the largest proven gold belt in the western hemisphere. The other major gold producing states, in order of descending 1987 production, are California, South Dakota, Montana, Washington, Utah, Colorado, and Alaska. The U.S. gold mining industry has undergone a rapid transformation during the 1980's as production has boomed. Only four of the Nation's twenty largest gold mines in 1986 were opened before 1981. Newmont Gold and Homestake Mining are by far the largest domestic gold mining companies, with estimated 1988 production of 930,000 ounces and 560,000 ounces, respectively. Foreign investment in the U.S. gold mining industry has sharply increased since 1980. A major gold mining boom has been gathering momentum in the United States since 1980 as domestic gold production has increased from slightly less than one million ounces in 1980 to 4.52 million ounces in 1987. The U.S. is currently the third largest gold producing country in the world, behind only South Africa and the Soviet Union