Gold Stocks in South Australia

South Australia accounts for more than a quarter of the country’s gold resources, but only 4 percent of gold production. What does the future hold?

Australia is the world's second largest gold producer, most recently putting out 330 metric tons in 2021.

While Western Australia is the country's most famous gold-mining jurisdiction by a long shot, accounting for around 63 percent of national output in 2021, South Australia also has a role to play.

The state provides only 4 percent of Australia's gold, but holds over a quarter of the nation's yellow metal resources. Could the future hold more for gold production and gold stocks in South Australia?

Where is gold found in South Australia?

South Australia may be sitting on a lot of gold potential, and one area in particular has attracted strong attention from both the government and mining companies: the Gawler Craton.

This major geological region takes up 440,000 square kilometres and covers roughly half of the state, with South Australia’s three producing gold mines all located in the area — these assets are owned by sector giant BHP (ASX:BHP,LSE:BHP,NYSE:BHP) and OZ Minerals (ASX:OZL).

Beyond these large miners, the outlook for South Australia to increase its share of Australian gold production in the coming years is positive thanks to the exploration and development projects in the state. Its sparse population and desert landscape, along with its geological endowments, make this work relatively easy to carry out.

What are the top South Australian gold stocks?

South Australia has a high investment attractiveness ranking from the Fraser Institute, coming in 10th worldwide and second in Australia itself, behind only Western Australia.

Although all investors must do their own due diligence, those interested in Australia-focused gold companies may want to consider gold stocks with assets in South Australia.

The trick is finding them. As mentioned, BHP and OZ Minerals own the state's three operating gold mines, but it's worth noting that all of those operations are polymetallic, producing other metals in addition to gold.

Read on for a look at those companies, as well as three exploration stocks that have honed their efforts on gold in South Australia. Market cap data was current as of September 12, 2022.

1. BHP

Market cap: AU$199.39 billion

The owner and operator of the world-famous Olympic Dam polymetallic mine is none other than BHP. The company has operated the copper-uranium-silver-gold mine since 2005, though it’s been in operation since 1988.

While Olympic Dam is known primarily for its copper and uranium output, the mine represents almost half the gold output in South Australia, accounting for a record 146,000 ounces of gold in 2021.

2. OZ Minerals

Market cap: AU$8.93 billion

OZ Minerals is another of the big players in South Australia, with two operating copper-gold mines and exploration tenements across the state. The company produced 141,676 ounces of gold from its Prominent Hill mine in its 2021 fiscal year. Its second mine, Carapateena, is in the process of ramping up production following the approval of a block-cave expansion in 2021. Carapateena produced 89,778 ounces of gold in OZ's 2021 fiscal year.

Prominent Hill is also ramping up further. A shaft mine expansion was approved in 2021, with the possibility to extend the mine’s life, lower operational costs and increase production rates to 6 million tonnes per year in 2025. The expansion will also open up new prospects for previously uneconomic areas.

South Australia is the star jurisdiction for OZ Minerals, being home to two of its operational mines. It also has interests in Brazil, Peru and Sweden, though Australia remains the focus of its operations.

3. Rex Minerals

Market cap: AU$127.12 million

Rex Minerals (ASX:RXM) is an exploration and development company with assets in South Australia and Nevada. Its Australian interest is the Hillside copper-gold project on the Yorke Peninsula.

The Hillside project is a proposed mine only discovered recently in 2008. The 100 percent owned Hillside project sites atop 2 million tonnes of copper and 1.4 million ounces of gold, with production scheduled for 2025. According to Rex's latest company ore reserve statement, Hillside holds 823,000 ounces of proved and probable gold.

4. Havilah Resources

Market cap: AU$110.8 million

Havilah Resources (ASX:HAV) is currently billed as an exploration company, with a raft of exploration and development projects dotted through Eastern South Australia against the border with New South Wales, where the nearest city and famed mining town of Broken Hill is located.

The company currently estimates its assets hold 3.2 million ounces of gold split between the Kalkaroo and Mutaroo projects — both located within South Australia outside of the Gawler Craton.

Kalkaroo, which is the company’s flagship project, sits on 3.1 million ounces of gold, according to its measured, indicated and inferred JORC mineral resources. OZ Minerals has the option to acquire Kalkaroo, and is undertaking a study program to inform its decision.

5. Indiana Resources

Market cap: AU$32.78 million

Indiana Resources (ASX:IDA) has a portfolio of gold tenements in South Australia, including the Gawler Craton gold project, which it acquired in 2021. Its ground position covers over 5,000 square kilometres between two historic gold mining centres, Tunkillia and Tarcoola.

This is an updated version of an article first published by the Investing News Network in 2020.

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Securities Disclosure: I, Matthew Flood, currently hold no direct investment interest in any company mentioned in this article.

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Matthew Flood

Matthew Flood is a writer and editor from Montreal, Canada. He's been writing professionally for four years on a wide array of topics ranging from investments and real estate to cookware and home improvement. Matt also enjoys creative writing and has written two novels and a novella.

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