Gold in Victoria

Though it represents a fraction of Australian output, Victoria is notable for a re-emerging gold development community.

The Australian state of Victoria has a long history with gold, with the precious metal having been discovered mere months after the colony was created in the mid-1800s.

Since then, gold has been a foundation of Victorian identity. Many of the grand buildings in the capital city of Melbourne, along with the former boomtowns of the central goldfields, were funded by the vast wealth that was mined in the small Australian state.

That wealth made Melbourne one of the richest cities in the British Empire in the 1800s, while the lure of prosperity made it the second largest at the time, behind only London itself.

Today, gold continues to be mined in Victoria. Though it represents a fraction of Australian output, the state is notable for a re-emerging gold development community, with many explorers sniffing around the area from Australia and beyond.

In 2018, 13 of the 315 tonnes of gold mined in Australia came from Victoria from seven active mines — most of which are located within regions known for vast historical output of the yellow metal near the cities of Ballarat and Bendigo, and in the Great Dividing Range.

While gold reserves in Victoria are low in comparison to other Australian states, output continues to rise, and gold has been a staple since the first major waves of settlement in the 19th century. Today, the state has a vastly diversified economy, but it all began with gold.

There are not so many producers in the state today, but Melbourne is home to some of the largest mining companies in the world, with BHP (ASX:BHP,LSE:BHP,NYSE:BHP) and Rio Tinto (ASX:RIO,NYSE:RIO,LSE:RIO) hosted in the city, pointing to a healthy industry for capital raising.

The largest gold-producing mine is Fosterville, which is owned by none other than Canadian company Kirkland Lake Gold, famed for its profitable operations in Ontario.

Read on to learn about some of the top gold-focused companies currently operating in Victoria.

1. Kirkland Lake Gold (ASX:KLA)

Market cap: AU$16.12 billion

As mentioned, Canadian company Kirkland Lake Gold is the operator of the prolific Fosterville gold mine, located in Central Victoria near the city of Bendigo, a former gold rush boomtown.

Fosterville produced some 619,366 ounces of gold in 2019 — representing a rapid ramp up of mining activity since 2016, when it produced 150,000 ounces. The mine has been producing gold since 2005, and is the premier mine in the state, accounting for a majority of gold produced annually.

Kirkland Lake continues to carry out promising exploration around the mine, with intent to expand known mineralized zones.

2. Mandalay Resources (TSX:MND)

Market cap: C$143.26 million

Despite being listed in Canada, Mandalay Resources’ two producing assets are in Australia and Sweden. Its Australian operation is the gold-producing Costerfield mine in Central Victoria, where 15,258 ounces were produced in 2019. Guidance from the company puts 2020 production between 44,000 and 48,000 ounces, representing a massive ramp up in gold output.

Costerfield has been in Mandalay’s hands since 2009, with the company pouring millions of dollars into expanding processing capacity and exploration. The mine is situated near the city of Bendigo, which is as mentioned a historic gold-mining settlement.

3. Navarre Minerals (ASX:NML)

Market cap: AU$130.18 million

Navarre Minerals is an explorer and developer with projects in early to late-stage development in Western Victoria. It currently holds tenements across gold zones in the state, with some near the Fosterville mine and another near the historic Stawell gold mine. The company’s objective is to to drill around known gold sources.

Navarre is exploring what it calls “Fosterville-like” gold potential around its St. Arnaud gold project, located to the west of Bendigo.

4. AusStar Gold (ASX:AUL)

Market cap: AU$16.13 million

AuStar Gold is a small company with lofty goals, aiming to be one of the next mid-tier gold producers in Australia. Its tactic is the restarting of mining in historically prolific regions.

The company has interests in two historic mines, including Morning Star in the Great Dividing Range, near the historic mining town (and now ghost town) of Walhalla.

The gold field Morning Star is located in has historically produced some 6 million ounces of gold, while the Morning Star mine itself produced 800,000 ounces over its lifetime, once counting as one of the largest underground gold mines in the country.

The second project of interest owned by AuStar is the Rose of Denmark mine, located near Morning Star. A smaller prospect, this mine produced 36,000 ounces of gold in its former life, and according to AuStar is a promising source of more gold for future Morning Star processing operations.

Don’t forget to follow us @INN_Australia for real-time updates!

Securities Disclosure: I, Scott Tibballs, currently hold no direct investment interest in any company mentioned in this article.

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On 2 March 2021 the Australian Taxation Office issued Rio Tinto Limited with amended assessments related to the denial of interest deductions on an isolated borrowing used to pay an intragroup dividend in 2015. The borrowing was repaid in 2018. The ATO has today issued further assessments in relation to the same transaction levying penalties of A$352m and reducing the original interest assessment from A$47m to A$27m …

On 2 March 2021 the Australian Taxation Office (ATO) issued Rio Tinto Limited with amended assessments related to the denial of interest deductions on an isolated borrowing used to pay an intragroup dividend in 2015. The borrowing was repaid in 2018.

The ATO has today issued further assessments in relation to the same transaction levying penalties of A$352m (US$257.9m) and reducing the original interest assessment from A$47m to A$27m (US$19.8m).

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Ioneer Ltd (“ioneer" or the “Company") (ASX: INR) is pleased to announce that the Company has reached an agreement to establish a joint venture (the " Joint Venture “) with Sibanye Stillwater Limited ( “Sibanye-Stillwater" ) to develop the flagship Rhyolite Ridge Lithium-Boron Project located in Nevada, USA (the “Project" ). Under the terms of the agreement, Sibanye-Stillwater will contribute US$490 million for a 50% interest in the Joint Venture, with ioneer to maintain a 50% interest and retain operatorship. ioneer has also agreed to provide Sibanye-Stillwater with an option to participate in 50% of the North Basin 1 upon the election of Sibanye-Stillwater to contribute up to an additional US$50 million subject to certain terms and conditions.

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Gold isn't all that glitters in the land down under — silver in Australia is a major industry, and the country is home to both large and small players.

When it comes to precious metals, Australia has long punched above its weight — the nation was born riding the wave of a gold rush.

Gold isn't all that glitters through — Australia is also a major global producer of silver. It's among the 10 top producers, and was ranked seventh in 2020, with 1,300 tonnes coming from the many operational mines in the country. By comparison, the world's top producer, Mexico, produced 6,300 tonnes that same year.

Other key players in the silver market are Peru, China and Russia, which produce more silver than Australia, and the US, Argentina and Bolivia, which produce less.


Australia is sitting on quite a lot of the precious metal, with the world's second largest reserves, behind only Peru.

According to Geoscience Australia, one of the country's first mines was a silver-lead mine near Adelaide. Since then, the entire continent has been combed over with a fine-toothed comb, with deposits identified in every state and territory and active mines in every jurisdiction but one (Victoria).

Overall, Australia is well explored when it comes to silver, and since the mid-1800s it's had a constant stream of silver production. Aside from that, the country boasts metals-processing facilities in South Australia that separate the precious metal from its commonly mined counterpart metals, lead and zinc.

Silver companies in Australia

Those looking at the Australian silver market have options. There are plenty of big players with interests in Australian silver, and many smaller players for investors to consider researching too.

Most silver comes from mines dedicated to other metals — Glencore's (LSE:GLEN,OTC Pink:GLCNF) Mount Isa in Queensland produces mainly copper, zinc and lead, but silver is separated by the company's integrated processing streams. Glencore also operates the McArthur mine in the Northern Territory, which is primarily zinc, but between its copper and zinc assets, Glencore produced 7,404,000 ounces of silver in Australia in 2020 — over 200 tonnes.

Elsewhere, BHP (ASX:BHP,NYSE:BHP,LSE:BLT) produces a lot of silver as well at the Olympic Dam operation in South Australia. Perhaps best known for the production of uranium and copper, it also yields significant silver resources to the tune of 984,000 ounces in 2020 (or almost 28 tonnes).

According to Geoscience Australia data from 2016, over 20 mines in Australia produced silver in that year, while there are dozens of other resources identified in each state.

A primary producer of silver is the Cannington mine in Queensland, where South32 (ASX:S32,OTC Pink:SHTLF), a company that was spun off from BHP in 2015, mines silver and lead. Cannington is a big one, producing 11,792,000 ounces in 2020, or 334 tonnes of silver.

Tasmania boasts the Rosebery mine, which has seen 85 years of continuous operations and is currently owned by MMG (ASX:MMG,HKEX:1208). Rosebery, like all the others here, is polymetallic, and besides silver also produces copper, zinc, lead and gold. MMG also has the Dugald River mine in Queensland which also produced silver.

Getting into smaller companies, there are those like New Century Resources (ASX:NCZ) which restarted the Century mine in the Northern Territory for zinc and silver.

The future of silver in Australia

So, you get the picture — there's a lot of silver to be mined in Australia by way of mining everything else.

It's worth noting that because silver operates both as a precious and an industrial metal, and is mined most often alongside base metals, it can be pulled in many directions. However, it traditionally follows (and lags behind) its precious metal sibling, gold, making it a valuable investment commodity to keep an eye on.

Looking forward, the future of the commodity in the land down under — especially given Australia's significant reserves and operator diversity — is as bright as you'd like it, and depends on what investors are most interested in, given the by-product nature of the metal.

Don't forget to follow us @INN_Australia for real-time updates!

Securities Disclosure: I, Scott Tibballs, hold no direct investment interest in any company mentioned in this article.

Australia took a stand against Facebook and Google earlier this year, and the move could have long-term implications for tech investors.

It was a ban that sent Australians wild and had the whole world watching.

Back in February, Facebook (NASDAQ:FB) stopped users in Australia from posting news in a week-long blackout, reacting to proposed legislation that would have forced the social media behemoth to pay publishers for content.

What prompted Facebook to "friend" Australia again, and what are the potential long-term implications of the squabble? Read on to learn what tech-focused investors in Australia should know about the situation.


Australia squares off against Facebook

On February 25 of this year, Australia's federal government passed the News Media and Digital Platforms Mandatory Bargaining Code. It was developed after extensive analysis by the Australian Competition and Consumer Commission, and is aimed at ensuring that news media businesses are fairly remunerated for their content.

It stipulates that digital platforms such as Facebook and Google (both named in the documentation) must pay news outlets whose content they feature — for example, if content is shared on Facebook or shows up in Google search results. The idea is that this will help to sustain journalism in Australia.

Unsurprisingly, Facebook and Google didn't react well to the code, which was first introduced in 2020.

Google didn't make any moves after it passed, but Facebook quickly made it impossible for Australian users to share news content, and pages for both local and international news organisations went blank — a major concern given the COVID-19 and wildfire concerns that were circulating at the time.

Australian Prime Minister Scott Morrison was scathing about Facebook's decision — which he ironically shared in a Facebook post — declaring the tech giant's actions "as arrogant as they were disappointing." He added, "These actions will only confirm the concerns that an increasing number of countries are expressing about the behaviour of BigTech companies who think they are bigger than governments and that the rules should not apply to them."

Despite strong feelings from both Australia and Facebook, the dispute was resolved fairly quickly, with the country agreeing to make four amendments to the legislation and Facebook restoring Australian's access to news.

Implications for Big Tech and news organisations

Both Australia and Facebook have claimed victory in the dispute, with a Facebook representative saying the company will be able to decide if news appears on the platform — meaning it won't automatically have to negotiate with any news businesses. Changes were also made to the arbitration process.

Tech experts have pointed out that larger news companies may ultimately benefit from the changes, but smaller ones could be pushed to the side. Major publishers that have struck agreements with tech giants, such as News Corp, Nine Entertainment (ASX:NEC,OTC Pink:NNMTF), Seven West Media (ASX:SWM) and Guardian Australia, may be able to increase their market share while smaller independent players lose out.

A business that is in full support of the laws is Microsoft (NASDAQ:MSFT). During the conflict, President Brad Smith came out loudly in favour of Australia's law, and advised that his company is willing to step up with search engine Bing should Google and/or Facebook pull out of the Australian market.

"In Australia, Prime Minister Scott Morrison has pushed forward with legislation two years in the making to redress the competitive imbalance between the tech sector and an independent press. The ideas are straightforward. Dominant tech properties like Facebook and Google will need to invest in transparency, including by explaining how they display news content," he said in a blog post.

"The United States should not object to a creative Australian proposal that strengthens democracy by requiring tech companies to support a free press. It should copy it instead."

Global reach and tech investor impact

Six months down the road from Australia's landmark legislation, it's tough to say what the long-term impact may be.

That said, market watchers do believe the country is part of a new precedent of forcing Big Tech into paying for journalism — something giants Facebook and Google are not used to.

Countries looking to pursue similar legislation include Canada, where Facebook agreed in May to pay 14 publishers to link to their articles on its COVID-19 and climate science pages, as well as other unspecified use cases. Canada is pursuing other avenues too. Meanwhile, in France, Google said it will pay publishers for news content after the country took up new EU copyright laws that make digital platforms liable for infringements.

For investors, the takeaway is perhaps that while companies like Facebook and Google may seem too big too fail, they too can fall subject to new regulations that can change how they do business. As nations around the world look to take back control from these mega companies, it's important to be aware of possible effects on their bottom lines.

Don't forget to follow @INN_Australia for real-time updates!

Securities Disclosure: I, Ronelle Richards, hold no direct investment interest in any company mentioned in this article.

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