Australia’s resources industry is constantly throwing-up companies that are going through the rite of passage from explorer to producer, which can often change the way the company is viewed on the stock market – notwithstanding the fact that potential gives way to the exposure to all the things that can go wrong with complicated mining and processing operations, and the added scrutiny of whether throughput matches expectations. But against that, mining and processing means revenue, and from revenue there is the prospect of profit, and even, eventually, dividends. Production is a huge achievement for resources companies – here are four, across a range of commodities, that appear poised for this milestone in 2020.
1. Barra Resources (BAR, 2.2 cents)
Market capitalisation: $13 million
Three-year total return: –19.4% a year
Analysts’ consensus valuation: n/a
All over Australia there is huge interest in re-opening old gold mines, based on the fact that hardly any of them are mined-out, and they are usually very high-grade. The Burbanks deposit, at Coolgardie in Western Australia, is a typical example: from 1887 to 1914, the mine was the highest-grade gold mine in WA, at 22.7 grams per tonne (g/t) of gold, from both underground and open pit mining, before it fell victim to a manpower shortage brought on by World War I. The mine was re-opened by Western Mining in the early 1950s, but closed down in 1991.