Explorers and Australia’s newest producer make gains as gold continues its ascent

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Another day and gold is another step closer to all-time records as safe-haven demand, a weaker US dollar and increasing consumer demand from China and India fuels its rise this week.

Spot gold is currently trading around $US1,888.20 an ounce, up more than 4 per cent from its close last week.

Locally, the gold price is about $2,658 an ounce as the US dollar gained against its Australian counterpart.

>>Scroll down for some of today’s best performing small cap ASX gold explorers

Bank of China international analyst Xiao Fu told Mining.com that it would not be surprising if gold rises to $US1,900 an ounce due to geopolitical risks, worries about further tensions between the US and China, and ample liquidity from widespread central bank stimulus measures.

Horizon joins the gold producing ranks

The continued strength in gold prices will be sweet music to the ears of Australia’s newest gold producer.

Horizon Minerals (ASX:HRZ) has poured first gold from its Boorara mine and expects to start receiving revenue before the end of July.

Shares in the company rose 3.45 per cent to 15c this morning on the news.

Horizon said mining continued ahead of schedule and that unreconciled mill grades to date were generally in line with expectations.

The company has scheduled monthly milling campaigns through to January 2021 to treat 159,000 tonnes of ore grading 1.86 grams per tonne (g/t) to recover 8,700 ounces of gold.

This is expected to generate $7m in free cash flow at current gold prices.

“First gold production from Boorara is an exciting milestone for the company and it is extremely pleasing to see the mine performing to expectations,” managing director Jon Price said.

Reconciliation results from first-stage mining will feed into the feasibility study for the larger-scale mine development.

Horizon Minerals (ASX:HRZ) share price

Top small cap gold gainers

The rising gold prices have also boosted the share prices of the explorers with minnows such as Amani Gold (ASX:ANL) and Dark Horse Resources (ASX:DHR) putting on 50 per cent and 33 per cent to their share prices respectively this morning on no news.

Shares in Dacian Gold (ASX:DCN) climbed 5.56 per cent to 33c after it reported high-grade hits from both infill drilling within and drilling outside the existing resources at the underground Phoenix Ridge deposit at its Mt Morgans gold operation in Laverton, WA.

Notable infill results include 8.6m grading 74.7g/t gold from 286.4m and 14.9m at 12.5g/t from 258m, while drilling in the hanging wall outside of the existing resource returned hits of 1.1m at 70.4g/t from 288m and 0.5m at 715g/t from 299m.

Infill drilling at the McKenzie Well open pit returned 7m at 2.8g/t from 78m and 8m at 2.3g/t from 53m.

Diamond drilling has also confirmed the potential for the extension of mineralisation beyond the current open pit at Mt Marven, with holes returning 7m at 1.7g/t from a depth of 101m, 5.4m at 2.9g/t from 166m and 1m at 13.2g/t from 199m.