3 days ago
Record high gold prices prompt revival of outback Queensland mines
Once bustling with gold deposits along railroad tracks, the Cloncurry region in outback Queensland was a literal goldmine.
But as the metal's price crashed in the 1990s, so did the digging and prospecting.
This year, the gold price hit a record high of more than $5,070 per troy ounce.
With the international commodity boom, a new gold rush era is on the rise — and the outback industry might be back in business.
Australia is the third-highest producer of gold in the world, behind China and Russia, and ties with Russia as the top country for gold mine reserves.
University of Queensland Sustainable Minerals Institute director Rick Valenta said the last time gold prices were close to 2025's numbers was in the 1980s, at $3,400 per troy ounce.
"It's the highest it's ever been in history. That's probably a pretty good definition of a gold boom," he said.
He said global political uncertainty caused gold prices to skyrocket in the past five years, driving the increase in fossicking, and reopening of historical mines across the country.
"A really common thing to do is to go back and re-look at mines, particularly if the production happened 50 to 100 years ago," he said.
"Methods for extracting [minerals] weren't as good as they are now, so people left a lot of gold behind.
"In many cases you can go back and retreat the tailings and waste from those mines to extract [even more gold]."
North West Queensland's historic mining history puts it at the top of the global resources stage, Professor Valenta said.
"[North West Queensland] is just one of the special places on the planet that has an enormous amount of mineral endowment, and there's always that potential to take advantage of price cycles on deposits, where that can be done in a relatively short time," he said.
The region is home to one of the most productive gold mines in the country — Ernest Henry Copper-Gold Mine — estimated to hold 2 million ounces of gold.
Two companies are now looking to cash in on the historic, high-grade deposits in the region and soaring prices.
Orion Resources and AuKing Mining Limited plan to re-lease 20 historic gold mines in the region, bringing them back to life under the banner of the Cloncurry Gold Project.
The key cornerstone of the project is the acquisition of the old Mount Freda gold mine — a prominent open pit mine that ceased production during the 1990s gold price crash.
In 2019, mining company Tombola Gold sought to revive production at Mount Freda, setting up production for AuKing and Orion.
AuKing managing director Paul Williams said the project, which covers more than 400 square kilometres, aimed to be producing gold within the next 12 months.
"With the gold price where it is and projecting to still be strong, that's probably opened up areas that historically were not available for the earlier mining companies, like Tombola," he said.
The companies signed a preliminary agreement late last year and are set to finalise it at the end of July.
"We're operating in a great gold price environment at the moment with access to a huge amount of data from the good work that previous groups have done," Mr Williams said.
"The previous companies who owned the mines beforehand didn't have the gold price environment that we do now.
"But we're looking to get moving with drilling initially and then hopefully probably around the Mount Freda area to start mining."
The project is not the only one in the North West and Cloncurry regions vying to capitalise on the boom.
Qgold's Woolgar Gold odyssey, 130 kilometres north of Richmond, is awaiting statutory approvals.
Mayfield Mt Isa Copper-Gold Project is also mining in the mineral-rich Mary Kathleen region, alongside the recently opened Greater Duchess Copper Gold Project.
So, is this a replica of the famous 19th century gold rush era for Queensland?
Professor Valenta said while it was impossible to tell the future, current prices and increased prospecting showed a positive direction for the industry.
"If you've a few gold coins in the bottom drawer, you'll get more from them now than you ever would have in the past," he said.
