Aside from last year's gold price-fuelled rally, a band of Aussie juniors and an emerging locally-based gold producer are whipping up an exploration-inspired fervour in the Aussie gold market as they move closer to breaking the major gold discovery drought in this country.
This handful of companies has not only made some exciting new gold discoveries but in the process has also gone a long way to challenging widely-held negative perceptions about Australia's gold prospectivity or views of Australia as a mature gold exploration location. Of course there are native title, land access, red and green tape, taxation, royalties, exploration incentive and other hurdles for gold sector investment, but we're not alone.
While the new finds may not become world-class in size, if nothing else Troy Resources [ASX:TRY], De Grey Mining [ASX:DEG], Legend Mining [ASX:LEG], Agincourt Resources [ASX:AGC], Gateway Mining [ASX:GML] and others appear to have brought to an end the greenfields and brownfields gold exploration barren spell in Australia, which has been starved of new gold finds since LionOre Mining International and Dalrymple Resources discovered the Thunderbox orebody in 1999. (Thunderbox, which is currently in production, was ultimately estimated to contain a resource of about two million ounces.)
Two of them, De Grey and Legend, today (Wednesday) provided further evidence that they had significant gold deposits in the making at their Wingina prospect and Gidgee project in Western Australia respectively, while only a few days ago Troy, who also produces gold in Brazil and recently posted an improved interim (December half-year) net profit of A$4.1 million, produced some spectacular drill hits from the Lord Nelson prospect near its existing Bulchina/Sandstone operation, also in WA.
Consequently, investors have been queuing up for a slice of these stocks, and that in turn has seen their values skyrocket. For instance, De Grey has soared just under 850 percent from a market capitalisation of only A$5.5 million last July to a current A$52 million and Legend – who like Agincourt is turning a recently discarded mine into a growth asset – has climbed four-fold from A$7.5 million last June to the latest A$31 million.
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