JOHANNESBURG - The world’s gold sector has fostered potentially misleading and inconsistent reporting of its actual cost structure, with suggestions that actual costs may be higher than those publicly declared, a senior executive has said.
Gold Fieds CEO Nick Holland, whose company is one of the world's leading producers of the precious metal, told the ongoing Africa Downunder conference in Perth, Australia that the potential under-reporting was occurring in the context of a generally under-capitalised gold industry.
"We face a situation where gold miners have not been spending enough capital to sustain production, let alone grow production,” he said.
“Any growth capital people speak about is in fact largely sustaining capital. On the face of it, cost performance of the gold industry has been good – but this has been at the expense of sustainability of production."
The cost to sustain production was increasing, with the the industry mining more tonnes at lower grade to maintain ounces, said Holland.