Sustainable Gold & Silver Producers Showcase New Value Creation Model

Company Interviews

Panel with Bradley Langille, President & CEO of GoGold Resources Inc. and Niël Pretorius, CEO of DRDGOLD Ltd.

Recording date: 18th October 2024

In today's high precious metals price environment, with gold testing $2,700/oz and silver around $30-32/oz, DRDGOLD and GoGold Resources demonstrate how mining companies can generate substantial returns while addressing environmental legacies. These companies have developed profitable business models that combine precious metals production with environmental remediation, offering investors exposure to both traditional mining returns and sustainable business practices.

DRDGOLD, operating in Johannesburg, South Africa, has established itself as a leader in tailings reprocessing, producing 155,000-170,000 ounces of gold annually. The company's success is built on operational excellence in high-volume, low-grade processing, supported by significant technological investment. With a 17-year track record of consecutive dividend payments, DRDGOLD demonstrates the financial viability of environmental remediation in mining. The company is currently investing in infrastructure to extend mine life by 14-23 years, positioning itself for long-term sustainable production.

GoGold Resources offers investors a different angle on sustainable mining, combining tailings reprocessing at their Parral project in Mexico with traditional mining development at their Los Ricos project. The Parral operation generates consistent cash flow while cleaning up historical mining waste, with the company paying approximately $75,000 monthly to the local municipality, representing 5-10% of the municipal budget. This demonstrates how environmental cleanup can create value for both shareholders and local communities.

Both companies are benefiting from shifting industry dynamics. The gold market has become more resilient to Western sentiment, with new buyers providing stability. Additionally, increasing focus on environmental liabilities is creating opportunities for companies with expertise in remediation. The legal landscape is evolving, with mining companies facing greater accountability for historical environmental impacts, making the expertise of DRDGOLD and GoGold more valuable.

The regulatory environment, particularly in Mexico, appears supportive of sustainable mining practices. GoGold's management expresses optimism about the new administration under President Sheinbaum, noting alignment between government priorities and their approach to development. This regulatory stability, combined with strong community relations, reduces operational risk for investors.

For investors, these companies offer several compelling attributes: proven operational expertise in environmental remediation, strong cash flow generation, exposure to high precious metals prices, and positioning in an industry segment likely to see increased attention as environmental standards tighten globally. DRDGOLD's consistent dividend payment history and GoGold's dual focus on cash flow generation and growth through Los Ricos provide different but complementary investment opportunities.

Looking ahead, both companies are well-positioned to capitalize on industry trends. DRDGOLD's infrastructure investments and GoGold's development pipeline at Los Ricos suggest continued growth potential. Moreover, their expertise in environmental remediation positions them to take advantage of similar opportunities globally, as the industry faces increasing pressure to address historical mining impacts.

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Learn more: https://cruxinvestor.com/companies/gogold-resources
https://cruxinvestor.com/companies/drdgold-limited

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