Technical barriers don't seem to impact gold, with the yellow metal punching straight through the US$1600 barrier overnight to a new record high.
It was just four months ago spot gold broke the new territory of US$1500, and less than six months since US$1400 was breached.
To highlight the meteoric rise of spot gold, the price is already 35% higher than the US$1190 a year ago, two and a half times the US$600 from five years ago and six times the US$270 from ten years ago.
But importantly - what impact does the price have on Australian listed stocks.
ASX listed gold producers to benefit
Running a quick ruler over some ASX listed gold producers, Philippines focused CGA Mining (ASX: CGA, TSX: CGX) earlier in the month announced over 190,000 gold ounces were produced for financial year 2011 - and based on an average spot price of around US$1400 an ounce, that’s gross revenues of US$270 million - just for the year.
Add to this a Probable Reserve of over 3 million ounces at the project, and a production goal of 200,000 annually, the sub A$950 million market cap. seems low.
Lachlan Star (ASX: LSA) is one producer certainly worth a review - considering the sub A$48 million market cap. yet forecast production for the next year of 45,000 ounces - for gross revenues of circa US$70 million based on a spot of US$1550, as the company is looking to reduce production costs as well.
Throw in the prospectivity of the area, their next door neighbour is no other than the massive Teck Resources (NYSE: TCK) Andacollo mine and the current valuation seems paltry.
Dragon Mining (ASX: DRA) is another interesting production story, when the A$105 million market cap. is put against the forecast of producing 40,000 ounces in Sweden at US$625 in 2011, plus 30,000 ounces in Finland at US$750 - those metrics supply gross revenues just for this year at US$110 million, based on the current gold spot price.
Integra Mining (ASX: IGR) is another that has been kicking goals in lifting production, with record monthly gold production in the month of May of 7,909 ounces - while on track to reach 100,000 to 140,000 ounces annually.
Integra forecasts financial year 2012 gold production cash costs to rise modestly to circa $550 per ounce maintaining Integra’s position as one of Australia’s lowest cost and highest margin gold producers. The $420 million market cap. seems light.
Silver Lake Resources (ASX: SLR) is an ASX 300 gold producing and exploration company with a resource base of 3 million gold ounces in the highly prospective regions including Mount Monger and the Murchison goldfields of Western Australia.
This strategy is underpinned by an accelerated exploration program that is targeting to grow the resource base to 5 million gold ounces by the end of 2011 - yet a market value of below $400 million.