RENO — While Nevada continues to lead the nation in gold production, China has bumped the state from third to fourth place in production worldwide.
Nevada’s gold production in 2006 totaled 6.3 million ounces, down 8 percent from the year before.
That places Nevada, which accounts for 78 percent of the total U.S. gold production, behind South Africa, Australia and China.
“Is it meaningful? No. We still are plowing right along,” said Russ Fields, president of the Nevada Mining Association. “What it does mean is China is developing capabilities in mining as it is in everything else.”
Nevada officials are not concerned, largely because of soaring gold prices. Last week, gold prices hovered around $670 per ounce, about $230 more than 2005.
The high prices have allowed Nevada’s mines to process lower-grade ore that usually wouldn’t be worth the effort.
Despite the drop in production, the total value of gold mined in Nevada last year soared to $3.8 billion, up nearly 25 percent from 2005.
What China’s rising gold production means long-term for Nevada is unclear, officials said, adding it’s hard to determine because of the Chinese government’s dominant role.
“China is a very hard business model to fit into and make money,” Fields told the Reno Gazette-Journal. “I do know the Chinese government plays a big role in production.”
Jim Golden, chief operating officer of GoldSpring ‘s Plum Mine near Virginia City, said he expects North American mining companies to pay attention to the Asian market.
“You can bet there will be a lot of Nevada names taking advantage of the China market,” he said. “We work, after all, in a world market. With the dramatic change in prices, everyone has to re-evaluate what they mine.”
Nevada’s mining industry is dominated by giants such as Newmont Mining Corp. and Barrick Gold Corp.