Submitted by SD Contributor SRSrocco
Here we can see the big change in diesel consumption per ounce of gold. For every ounce of gold that GoldCorp produces, it takes 23.2 gallons of diesel. If you read my previous article, this is about right for the average. However, we can see just how much this amount has risen in just 6 years.
I am working on other aspects such as total amount of processed ore and how much gold that is being produced per tonne.
GOLDCORP’S TOTAL PROCESSED ORE
2005 = 8.5 million tonnes
2011 = 95 million tonnes
GOLDCORP’S AVERAGE GOLD GRAM PER TONNE
2005 = 4.14 G/T
2011 = 0.81 G/T
1H 2012 = 0.65 G/T
GOLDCORP’S DIESEL CONSUMPTION
2005 = 9.7 million gallons (8.5 gal per oz)
2011 = 58.3 million gallons (23.2 gal per oz)
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Wow, that is just amazing. Look at that amount of gold per tonne that GoldCorp is producing. In just the past 6 months it has fallen 20%!!!
No one in the industry has a clue how bad the energy situation will become in the next several years as the gold mining community devours millions and millions more gallons of diesel…. as well as an increasing amount of gallons per oz.
Lastly…. just multiply this by the whole industry going forward.
![[Most Recent Quotes from www.kitco.com]](http://www.kitconet.com/images/live/s_silv.gif)
![[Most Recent Quotes from www.kitco.com]](http://www.kitconet.com/images/live/s_gold.gif)
Heres a few more of the largest gold miners:
2011 BARRICK = 29.0 gal diesel per oz gold
2011 NEWMONT = 28.7 gal diesel per oz gold
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2005 BARRICK = 15.4 gal diesel per oz gold
2005 NEWMONT = 18.9 gal diesel per oz gold
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Here we can see that Barrick has nearly doubled its diesel consumption per ounce of gold since 2005 and Newmont has used almost 10 more gallons of diesel per oz of gold since 2005.
Great post again. thanks
As the Price of fuel increases with the general cost of commodities, an eventuality that will happen, Gold will rise on the simple mathematics of rising fuel costs. Thank you SRSRocco, once again for an enlightening post. Please keep these amazing posts coming our way, well done
Way to go, SRS.
Now here’s a chart even I can understand.
Keep digging (try not to burn too much diesel in the process.
These posts are very informative. The psychologically battered silver bug community deserves to hear something positive and hopeful from time to time. Thanks to you and the Doc for all the effort.
Holy Gas Pumps, Batmen………this can’t end well !
diesel oil as good as gold
Lower metals content ore = more tonnage of ore moved and processed per oz. of finished product = more fuel needed for the machines that do all this mining, moving, and processing work. This is a trend that will continue for the foreseeable future, barring any huge Klondike or Comstock type strikes.
Sooo… you’re sayin sell my GoldCorp buy Phys
Looks like gold stocks have followed the rally up this time around.
This trend of increasing diesel consumption is spread across the whole mining industry. At some point in time, the mining industry will have to pick and choose the projects it wants to mine, instead of mining anything that is in their pipeline.
I have to tell you folks, I am really surprised at the degree of falling ore grades at the top gold miners. Now, I am not talking about ORE GRADES BEFORE MILLING & PROCESSING…I am talking about taking the total gold production and dividing it by total amount of processed ore to get the real value.
For instance, many people may think the South African gold miners have much better ore grades because they mine more underground. This is true, however…. their grades are falling too. Take a look at ANGLOGOLD:
ANGLO-GOLD (overall average gold ore grade)
2005 = 2.73 g/t (gram/tonne)
2011 = 1.80 g/t
This is a 34% decline in ore grade in just 6 years. Let’s just say their diesel consumption per ounce has doubled in the same time frame.