More matter with less art

G&A costs per ounce of gold: A comparative

The idea here is to get a handle on which junior mining company is running a tight ship and keeping G&A costs tight in Q3, as well as seeing which junior mining company was taking the piss with its G&A and spending way too much of your money on its own extravagances. Therefore the following:

  • We pick a bunch of juniors, mostly goldies but a few silver mining companies too.
  • We take the gold or gold equivalent ounce production total for each one (and in the case of the silver miners, we convert silver to gold equivalent ounces at 70:1).
  • We check out the quarterly G&A figure as posted by each company.
  • We do the math.
  • We also add in a couple of majors as a guideline, to show what the bigger boy companies typically run as a ounce-per-G&A ratio. The examples are Kinross (K) and Barrick (ABX), and their results are typical of the majors’ sector.

So here’s the chart:

Rio Alto (RIO.to) (RIOM) comes in very low due to some specific factors for 3q14, but it typically a low ratio for all its quarters and wouldn’t get over $30/oz normally.
Endeavour Mining (EDV.to) is clearly efficient in its offices, good job done.
The majors’ type average is around $55/oz to $65/oz, so any junior which emulates that level is doing well. Endeavour Silver (EDR.to) (EXK)and Richmont Mines (RIC.to) qualify, Lake Shore Gold (LSG.to) at a pinch).
The acceptable limit? Let’s say $100/oz.
Argonaut (AR.to) isn’t shy about spending money in its offices, apparently.
Gold Resource Corp (GORO) is a joke.

PS: What, the table? Yeah sure, here you go:

Ticker 3q14 G&A ($m) Oz Au or AuEq prod $ G&A/oz
RIO 0.777 56368 13.78
EDV 4.12 117612 35.03
KGC 38.2 701088 54.49
EDR 2.165 37465 57.79
ABX 98 1650000 59.39
RIC 1.578 23187 68.06
LSG 3.281 45600 71.95
FVI 3.467 35520 97.61
GPR 1.289 12285 104.92
TGD 3.062 26671 114.81
FR 5.27 41073 128.31
AR 3.334 22980 145.08
GORO 4.361 17262 252.64
in case of silver
mines, conversion to AuEq done at 70/1

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