Gold Fields shuns mergers to focus on WA exploration - Albany Advertiser
Gold Fields global chief executive Nick Holland says the company is unlikely to make new corporate moves in Australia and expects exploration in WA to rise to replace gold mined as new projects begin to dry up.
Mr Holland said investing in exploration was emerging as a better strategy than putting money into mergers and acquisitions, with gold inventories in decline globally.
“I think you’ll see an increase in exploration, not just in WA but across the country, as companies try to replace what they’ve mined,” he said.
“There’s only so much you can do with consolidation and there’s very little left to do in this space — a lot of mines are getting old.”
Gold Fields, which operates the Granny Smith, Agnew-Lawlers and St Ives mines in the Goldfields, produces about 900,000oz a year in WA and paid $350 million in 2016 for half of Gold Road Resources’ Gruyere mine, scheduled to pour its first gold bar next year.
It also recently paid $US200 million ($258 million) for a 45 per cent stake in the Asanko Gold mine in Ghana and is preparing to spend about $US850 million this year on capital expenditure.
Mr Holland said he saw the strongest growth potential in Australia at Gruyere and around Gold Fields’ existing mines, where it is spending about $85 million this year on brownfields exploration.
“With the pipeline we’ve got, we’re looking very good for a solid portfolio of 2Moz-plus for 10 years and probably even more,” he said.
“We’ll be around for a long time, and once Gruyere gets into production, we’ll have a good portfolio.”
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