Gold discovery rates dropping, S&P says

The first gold doré bar produced at Pretium Resources’ Brucejack mine. Credit: Pretium Resources.The first gold doré bar produced at Pretium Resources’ Brucejack mine. Credit: Pretium Resources.

The following is an edited excerpt from S&P Global Market Intelligence’s annual Gold Discoveries report. To see the full report, visit

Although gold exploration budgets have fallen from a 10-year peak in 2012, spending on finding new gold ounces remains at historically high levels, with the US$54.3 billion allocated to gold exploration over the past decade almost 60% higher than the US$32.2 billion spent over the preceding 18-year period.

However, the increase in dollars spent has not yet resulted in more discoveries or discovered ounces compared with the previous period: only 215.5 million oz. gold has been defined in 41 discoveries over the most recent 10 years, compared with 1,726 million oz. in 222 discoveries in the preceding 18 years. Even after adjusting for more recently identified deposits that might eventually surpass our threshold for a major discovery, and for major discoveries with potential to expand, we forecast that the gold in major discoveries might only increase to 363 million oz. over the next decade.

Dwindling discoveries

While the amount of gold discovered annually varies widely from year to year, it roughly follows the trend of annual spending on gold exploration; although in terms of return in gold discovered for exploration dollars spent, the 1990s were a more fruitful decade than the 2000s. Of the 263 major discoveries in the past 28 years, over half (139) were made in the 1990s and contain most of the discovered gold.

The industry downturn that began in 1998 (and lasted into the early 2000s) had an impact on both budgets and discoveries. By 2000, budgets were almost one-third of their 1997 peak, and discovery rates were declining, with only 16 discoveries recorded from 2000 to 2002, containing 108.3 million oz., well below the average from any period during the 1990s.

The improving industry conditions that marked 2003 and most of 2008 resulted in rapidly increasing budgets and a corresponding ramp-up in discoveries, although both the number of discoveries and the amount of contained gold remained well below the levels seen in the mid-1990s. While budgets peaked at US$4.9 billion in 2008, gold discoveries peaked in 2005–2006, at 31 deposits. There has been a slow decline since 2006, with both the number of discoveries and the amount of contained gold trending downwards.

This trend escalated in 2010, with a precipitous drop in the amount of discovered gold, to just 18.6 million oz. from 61.5 million oz. in 2009. Despite historically high gold budgets since 2010, discovery rates have failed to break 40 million oz. in any given year.

Recent discoveries

Of the 215.5 million oz. contained in the 41 discoveries made over the past 10 years, almost half (105.8 million oz.) is contained in the 10 largest deposits. The biggest is Zhaojin Mining’s Haiyu gold project in China’s Shandong province. We estimate that the project — which hosts almost 16.4 million oz. in reserves and resources — was discovered in 2011 shortly before the discoverer, Laizhou Ruihai Mining, agreed to sell the deposit to Zhaojin, although the acquisition wasn’t completed until 2015.

Barrick Gold’s Goldrush discovery in Nevada, also made in 2011, is the second largest in the last decade, with 13.2 million oz. in reserves and resources. It is also one of the highest-grade deposits covered at 8.9 grams gold per tonne. Barrick aims to begin production at Goldrush in 2021 or 2022, and produce 500,000 oz. gold per year in doré over a 21-year mine life.


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