JOHANNESBURG (miningweekly.com) – Australia’s Financial Review on Wednesday quoted Gold Fields CEO Nick Holland as predicting "aggressive" merger and acquisition (M&A) activity, while The Western Australian reported the company’s intention to sink up to $500-million over five years in ground around its existing mines.

Both publications featured sizeable pictures of the Gold Fields CEO with The West Australian report emphasising that Gold Fields had no need to look beyond its own tenement holdings to expand, but believed corporate activity among Australian gold companies was likely to increase over the next two years.

The West Australian at the same time quoted Holland as planning to invest around its existing mines in the hope of repeating the brownfield discovery success that it achieved at St Ives gold mine in 2012, where a close look at old drilling results led to the discovery of the multimillion-ounce Invincible deposit, now the cornerstone of the Australian mine’s production.

“There’re people paying crazy prices to buy ounces in the ground ... for us, exploration here is good business but we’re going to be looking around the world for opportunities,” Holland is quoted as saying.

He expected the Australian gold mining business to become more “dynamic” as gold majors returned to backing junior explorers to refill their project pipelines.

In the three months to September 30, gold production at Gold Fields’ Australian operations fell 5% year-on-year and 1% quarter-on-quarter to 237 000 oz.

In addition to St Ives, the company also mines gold at Granny Smith, Agnew/Lawlers and Darlot, recently with the help of high technology.

Both aerial and underground drones are producing visual data for machine learning and mining software at St Ives and the company expects to be able to soon automate geology mapping, ground support design and load-haul dumper controls in Australia, where it may possibly introduce driverless trucks.

The Australian reports pointed to the decline in exploration expenditure across the gold mining industry over the past twenty years probably resulting in the industry hitting "peak production" within the next few years before supply begins to fall.

"Exploration is certainly drying up and it doesn't matter now even if we cranked up exploration significantly for a sustained period it’s not going to prevent the hiatus," Holland told The Australian Financial Review.

Senior producers would be aggressively buying the intermediates to augment production.
"And I think you’ll see consolidation,” said Holland, adding that his company earmarked between $90-million and $100-million a year for brownfield exploration around its four Australian mines.

In March, the Australian Federal Court overturned a 2014 ruling that the regrant of certain Western Australian tenements to Gold Fields was not compliant with the correct processes in the Native Title Act.

The Ngadju People had previously claimed to hold native titles covering about 250 mining tenements held by Gold Fields subsidiary St Ives, with 210 of those tenements invalid because the “right to negotiate”, as specified in the Native Title Act, had not been upheld.

However, the Federal Court confirmed that the regranting of the St Ives tenements was valid under the Native Title Act.

Gold Fields has pledged to continue to engage openly with the Ngadju People, and all other community stakeholders in relation to its operations in Australia.

In February, Surbiton Associates reported that last year’s Australian gold production totalled 285 t, almost two tonnes more than in 2014 and the highest yearly total since 2003.