(Mining Weekly) – The World Gold Council (WGC) released two new methods of calculating gold mining costs.
The first one is an update of the existing “cash cost” metrics, according to Mining Weekly. It studies costs, that weren’t included in the previous version of the cash cost model, for maintaining and sustaining the business production and mix them with production costs. The WGC called this method “all-in sustaining cost”.
The second method focused on the life cycle of the mine. It took into account the additional and varying costs of different phases of the mine. The WGC called this one an “all-in-cost”.
Terry Heymann, the WGC director, said that the new metrics were evolved to help investors comprehend gold mining industry costs, especially in the current gold market volatile state. These methods were released on Thursday, days after mining companies announcing downsizing by laying off employees, holding development projects and shutting down or selling.
Even non-WGC members are allowed to use these new metrics from January 1st for free. The WGC expect these methods to be helpful to investors, governments and local communities alike. Investors should use these methods to estimate the real value of gold, thus the market price to spot opportunities.
The traditional “cash costs” ceased to operate accurately, resulting in gold mining companies shutting down on the recent price slump. The question now is, can the gold mining companies hold till the end of the year? Or will the junior and emerging companies will shut down on gold price slump and costs skyrocket?