Spot gold continued its upward trend overnight and briefly pushed through the US$1700 an ounce technical barrier, before easing back to US$1697.
Gold has been the star commodity performer of late spurred on by the potential of more stimulus by the Federal Reserve.
In just the past month the yellow metal has climbed 5.8% or around US$93.
Although still well down from the peak of just over US$1900 an ounce around a year ago, Australian gold producers and near term producers are set to benefit.
One prime example of a company benefiting from the high gold price is Silver Lake Resources (ASX: SLR), which earlier in the week announced a bumper set of results for financial year 2012, with net profit almost doubling to $31.175 million.
Silver Lake's gold sales were up 28.8% to 83,347 ounces for the period.
The possible upside for Silver Lake is even greater, considering the recent $426 million offer for Integra Mining (ASX: IGR) would create a company with the potential to produce between 255,000 to 295,000 gold ounces in FY13, and a further increase to 400,000 gold ounces in FY14. This would transform the company into one of Australia's largest gold producers.
Australia's newest gold producer
Not to be forgotten are the companies who are just transitioning to gold production, with Kentor Gold (ASX: KGL) a perfect example.
Kentor is Australia's newest gold producer with the company's first pour at the Murchison Gold Project in Western Australia a couple of weeks ago. The first gold doré bar weighed 1.13 kg (36.3 ounces) and is estimated to be 90% gold.
Murchison is forecast to produce at around 24,000 ounces annually, with the added potential to expand production via Gabanintha. Planning is underway for an expansion in 2013, with initial production to be sourced from the Lewis and Reward pits at Burnakura.
Emerging producers
Millennium Minerals (ASX: MOY) will be pouring its first gold bar in weeks from the Nullagine Gold Project in Western Australia, which hosts a resource of 1.33 million gold ounces contained within 7 deposits on granted mining leases, with the largest being Golden Eagle - which contains around 62% of the total metal inventory.
Commercial gold production is due in the December 2012 quarter, with the average gold output planned at 72,000 ounces per annum at a site cash cost of $756 per ounce.
Proactive Investors could see Millennium increasing production to 100,000 ounces per annum from all deposits based on studies underway. The forecast EBITDA is $773 million and a project IRR of 40%.
Also looking to join the ranks of producers in the near term is Mutiny Gold (ASX: MYG), with the high grade Deflector Resource recently increasing by 61,000 ounces to 591,000 ounces (729,000 Eq Au) - with a grade of 6.4 g/t gold.
Mutiny's managing director, John Greeve is understandably chuffed and recently commented: "Deflector continues to prove itself as one of the premier undeveloped gold-copper assets in Australia.
"With an improved understanding on the geological controls of mineralisation and gold distribution, the company will now aggressively pursue our corporate goal of reaching 2.5 million ounces for Deflector.”
Ore sales another option
Deriving cashflow from gold doesn't just come from pouring the yellow metal, but ore agreements can be another avenue.
Take Phoenix Gold (ASX: PXG) as an example. The company continues to execute the strategy of monetising ore stockpiles by selling the ore to nearby mills from its smaller scale mining projects, with a target of generating between $1 and $2 million in cash a year.
Importantly this cash flow provides funding for conceptual mining studies.
For the latest ore deal, the haulage and processing has commenced from historic surface stockpiles - which will be processed at the Norton Gold Fields (ASX: NGF) 3Mtpa Paddington processing plant - which is only 20 kilometres east of Phoenix’s tenement package and is well serviced by existing haul roads.
The stockpiles contain an estimated 130,000 tonnes at 1.2g/t gold.
Jon Price, managing director, told Proactive Investors last week that Phoenix will look to execute more ore sales in the near future - which helps maintain the company as a self funded gold explorer.
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