Gold

Australia on Monday gave environmental approval for BHP Billiton to expand its Olympic Dam mine but set more than 100 environmental conditions on the uranium, copper and gold project. The $30 billion expansion of the existing Olympic Dam underground operation will create an adjacent open pit mine that would be the worlds biggest. An idea of the olympian effort required to construct the mine and the size of the undertaking is clear from the fact that trucks will haul overburden 24/7 for five to six years just to reach the ore body. The combined operations would mine 72 Mt ore per year and would produce 750,000 tonnes refined copper, 19,000 tonnes uranium oxide, 800,000 gold ounces and 2.9 Moz of silver per year.

International Business Times reports that a mob of horsemen armed with sticks and petrol bombs attacked an exploration camp run by South African miner Gold Fields' joint venture in Kyrgyzstan, the latest in a series of assaults on mining companies in the Central Asian state. Talas Copper Gold, a joint venture between Gold Fields and Britain's Orsu Metals, said on Monday that its security manager was severely beaten as he fled from a burning building at the exploration camp in Talas province. Kyrgyzstan, a former Soviet republic of 5.5 million people, is preparing to elect its next president to replace Almazbek Atambayev (pictured on left) on Oct. 30, following a year in which its former leader was overthrown and hundreds were killed in mob violence.

Reports on Monday say Indonesian security forces fired on striking workers at Freeport McMoRan's Grasberg mine in the country's poorest province West Papua after a protest turned violent, killing one and injuring a dozen other, including seven police, some of them critically. The local police chief said between 500 – 600 policemen are now billeted at the mine. About 12,000 workers vowed Friday to paralyse production at the massive gold and copper mine as their strike over pay enters its second month. There is a history of violence at the mine and Freeport, based in Phoenix Arizona, report annual payments reaching an average $5m each year for government-provided security and $12m for unarmed, in-house security at the Grasberg complex dating back to the 1970s.

Gold for December delivery traded up $37.30, or 2.3%, at $1,673.10 an ounce on the New York Mercantile Exchange in early afternoon trade Monday, after climbing more than $40 earlier to touch an intraday high of $1,676.70. Gold's gains come amid strong buying during China's Golden Week despite the fact that buyers have to contend with bullion that is $300/oz more expensive than last year. Traders reported that the price of gold has been moving up and down in sync with the S&P 500 in the last four sessions, while the safe-haven buying that spurred the metal's three-year rally was largely absent. Other precious metals also benefited from a near 2% drop in the dollar index.

The International Center for Settlement of Investment Disputes has advised Crystallex International Corp. that proceedings in its $3.8 billion case against Venezuela for nationalizing gold-mining assets has begun. The Toronto-listed company's main asset is its interest in the Las Cristinas gold project located in Bolivar State, Venezuela. Crystallex also holds interests in the Tomi and La Victoria mines in Venezuela and on Friday closed down 70% from its 52-week high. The stock was delisted in from the New York Stock Exchange earlier this year. Toronto-listed Rusoro is the only large producing gold miner operating in Venezuela and the country does not feature in the top 20 global gold producing states.

Fin24 reports South Africa's gold mining industry is under such cost pressure, owing to gold reserves that are too deep to be mined profitably, that within a decade or two this could mean the end of the industry. That's why there is great excitement about a promising new technology which could make deep underground mining possible and ensure the future of the industry. The world's deepest mine is AngloGold Ashanti’s Mponeng, which extends about 4 km (2.5 miles) underground. To be able to mine much deeper than this, where millions of currently inaccessible – or uneconomic – fine ounces of gold lie, would require a breakthrough. Significantly, AngloGold was recently the first group to herald such a breakthrough with an apparently large degree of certainty.

Does gold's precipitous $300 drop in September represent a fundamental market shift? It is hard to argue with this statement: "Global stock markets are volatile, central banks have not regained credibility, inflation is still a concern, and trust in the markets has not been restored. Yet gold continues to fall... Gold has lost its shine."

Workers at Freeport's Grasberg – one of the world's largest gold and copper mines – in the remote Indonesian province of West Papua vowed Friday to paralyse production, as their strike over pay enters its second month. About 12,000 of Freeport's 23,000 Indonesian workers have joined the strike that started on Sept. 15 and on Friday Freeport said some workers have returned, putting it in a position to increase mining and milling output. The gulf between the the two parties are so wide that chances of a settlement appear remote – Freeport has offered a 25% increase on wages while the union wants the current minimum rate of $1.50 an hour raised more than 8-fold.

A new report from research firm TNS could have implications for mining. A survey of affluent households around the world — defined as greater than $100,000 — found that 80% of the world's wealthy live in Western countries.TNS's Global Affluenty Investor study conducted interviews across 24 markets including China, Brazil and India.