Gold Prices to Stay ‘Strong for Some Time’, Australia’s St. Barbara Says
St. Barbara Ltd., an Australian gold producer, said it is focused on reducing costs amid forecasts for the price of the metal to “remain strong.”
“I think the price, and the consensus seems to be that the price, is going to remain strong for some time,” St. Barbara Chief Executive Officer Tim Lehany said in an interview on the Australian Broadcasting Corp.’s “Inside Business” program today. “There will be a lot of short-term volatility.”
Gold is in the 11th year of a bull market and futures reached a record $1,923.70 an ounce on Sept. 6 as investors sought alternatives to slumping equities and some depreciating currencies. Gold for delivery in December on Nov. 18 advanced 0.3 percent to $1,725.10 on the Comex in New York.
St. Barbara’s main assets are its Leonora and Southern Cross operations in Western Australia. The Perth-based company forecasts costs of A$610 ($610) to A$640 an ounce this financial year and gold production of 175,000 to 190,000 ounces for its Gwalia mine, Lehany said today. That gives St. Barbara a “very high margin on that production,” he said.
St. Barbara is interested in gold exploration opportunities in areas such as Southeast Asia, Lehany said.
“First prize for us has always been Australian production and Australian assets, but Australia is becoming more mature as an exploration province,” he said in the television interview. “We’re interested in opportunities in similar time zones, Southeast Asia and the Asia-Pacific, which is a very prospective area for gold and relatively underexplored.”
The Australian gold explorer has increased 18 percent to A$2.40 in Sydney trading this year, compared with a 12 percent decline for the benchmark S&P/ASX 200 Index.
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