This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Franco-Nevada Chair Urges Gold Miners To Invest In Technology

Pierre Lassonde Urges Gold Miners to Invest in Technology

The gold industry is in need of more high-quality deposits, Pierre Lassonde, chairman of Franco-Nevada (TSX:FNV,NYSE:FNV), told industry professionals at AME BC's Mineral Exploration Roundup. He reminded them that fulfilling this need is their job and asserted that the industry is falling short because miners have not invested in new technology. He believes that challenging years lie ahead if companies continue along this path.

The message Lassonde delivered last week in Vancouver is not new. He has issued this call to action before, including at the Denver Gold Forum, an event he sees as one of the most important for the industry.

Perhaps miners will take this consistency as an indication of how critical Lassonde believes the situation to be. He insisted that miners' lack of innovation is β€” and will continue to be β€” a major problem for the gold industry.

Lassonde did not shy away from using history to point out gold miners' shortcomings. Recalling gold's bull run in the 1970s, he said prices rose from $35 to $800. And though it took the industry seven years to respond, when it did, production more than doubled.

People debate why gold equities are so drastically underperforming bullion prices during this bull run, which has lasted for a decade. Exploration and development spending have soared, yet the industry lacks a discovery record that reflects these conditions.

Gold miners have spent enormous sums of money on low-quality projects. Cutoff grades in some cases are now as low as 1 gram per metric ton. β€œThe next cutoff is dirt,” quoted Lassonde as saying.

He also pointed out that many projects are in risky, undeveloped countries, which contributes to rising costs. Furthermore, moving projects to production once took about three to five years. It now takes 10 to 15 years, and Lassonde believes that time frame is eroding value.

1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $94.02 0.00%
FB $104.07 0.00%
GOOG $683.57 0.00%
TSLA $162.60 0.00%
YHOO $27.97 0.00%


Chart of I:DJI
DOW 16,204.97 -211.61 -1.29%
S&P 500 1,880.05 -35.40 -1.85%
NASDAQ 4,363.1440 -146.4150 -3.25%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs