‘We’re all rubbing our eyes’: northern Ontario gold miners thrilled as price hits new record | CBC News

Gold is glittering even more these days, hitting a record price of $4,000 US per ounce.

The steadily climbing price in recent years has already seen boom times for gold towns in northeastern Ontario and the opening of new mines.

Earlier this year, Discovery Silver purchased gold mines in the Timmins and Chapleau area from Newmount.

“We would have been happy with $2,250 gold. Price of gold where it is now is definitely beneficial in terms of helping us,” said president and CEO Tony Makush.

“Really, a big part of what these gold prices do is it gives us access to investment and it’s a 100-year-old mining camp and you need to get re-investment into some of the assets, re-investment in exploration.”

Makush grew up in Timmins the son of a gold miner before going onto a career as a mining engineer, and knows well the ups and downs of the metals market.

“We’re getting old enough and have seen enough cycles in the industry … we always have to plan our business around how do we survive in all parts of the cost curve,” he said.

A few months after purchasing several gold properties in Timmins, Discovery Silver is considering which mines to expand and which to re-open, including the Pamour mine. (Erik White/CBC )

Makush says his company expects to produce more than 200,000 thousand ounces of gold from northern mines this year.

But with the expansion of existing operations and the re-opening of other mines like Pamour in the Timmins area, he expects they could hit 300,000 ounces a year in the near future.

Makush says Discovery currently employs about 1,200 workers in northern Ontario, but “over time, you could see doubling that as we bring more production on.”

“Bring Timmins and Porcupine back to life and create prosperity for people for another 25 or 50 years,” he said.

Kai Hoffman, a minerals market analyst based in Germany, remembers people scoffing when he suggested last year that gold could hit $3,000 US per ounce, a price it passed this spring.

“It’s difficult not to be euphoric,” he said.

“But I do feel like the dog chasing a car right now and the car has stopped and I don’t know what to do with what I just caught?”

Hoffman, the CEO of the Soar Financial Group, said the mining industry is so accustomed to the boom-bust cycles, it’s been tough for them to trust that gold prices won’t crash back down.

“We’ve been burned a lot in our sector over the last 14-15 years, so we’re quite cautious. Terms like ‘PTSD’ come across my mind when I look at the price of gold, because it’s hard to believe. We’re all rubbing our eyes,” he said.

“We have to completely re-wire our brains. We have to look at projects very differently. Because all of a sudden companies that we had on the no-fly list are all of a sudden money makers and I think that’s the biggest change.”

Hoffman said that means investors are taking a closer look at junior mining companies, but says the financial boom has not yet followed the soaring prices.

“We’re all sitting on paper gains, but nobody’s had a real gain. But that will come.”

“The market needs to start believing in the higher gold prices.”