New industry analysis has shown foreign ownership of the Australian gold industry could exceed 50 per cent if US giant Newmont succeeds in its takeover of Newcrest.
The figure, which comes from mining analyst Surbiton Associates’ 2022 Australian gold production analysis, is based on the unsolicited $24.45 billion play Newmont made for Newcrest in early February.
While that deal was swiftly rejected, the possibility of another offer remains on the table.
In an interview on Bloomberg Television, Newcrest interim chief executive officer Sherry Duhe said the miner was “worth a lot more” than the opening bid but that the company was open to “seeing how things go” regarding conversations with Newmont.
According to Surbiton, Australian gold production for 2022 totalled 313 tonnes and was worth about $26 billion, but the overall number was down from the 315 tonnes produced in 2021.
Despite the small fall in production, Australia’s output has risen dramatically since 1982, when the country was producing fewer than 20 tonnes a year.
“In the early 2000s, the control of the Australian gold industry stood at 80 per cent,” Surbiton managing director Sandra Close said.
“It dropped to just under 30 per cent Australian control as overseas gold companies bought up Australian operations, and it was when the Aussie dollar was down around 50 (US) cents, so it was pretty cheap for them to buy the operations.
“Over time a lot of those operations were sold, so we’re currently looking at 60 per cent Australian control in the gold industry.
“But the recent announcement with Newmont and Newcrest, and we’ll be watching that closely, if that did go ahead it would mean Australian control would fall just below 50 per cent again.
“Whether we’d see yet another round of acquisitions as we did in the early 2000s is a pretty interesting question.”