How gold mining companies create value: A director’s perspective

What differentiates between a gold mining company that delivers you gains from one that literally mines your wallet and leaves you poor?

There are several factors – assets, management, operational performance, financial position, strategy, and luck.

Mining and resource investors hear stories from the accomplished legends in this space who talk about making millions (even billions) of dollars. There are many stories about how bonanza finds in the ground turned into lucrative mines. Yet there are even more stories that don’t make the headlines because nothing eventuated.

Mining isn’t about just finding a needle in a haystack, but it’s more like sticking needles to find a haystack! After all, exploration is about drilling holes into the ground to identify the presence of a mineral deposit.

Once the team finds what it believes is a deposit, there’s further exploration to determine how to extract the minerals and whether it’s economically viable.

Then comes the funding. Can the team find investors to back the project so construction can begin and the mine delivers revenue?

What I’m talking about is conceptual. It sounds simple, except reality shows that there’s a lot more to it.

Rather than having you read about this, I’ve got something better, a lived tale of experience.

Back in late March, I attended the 2026 Gold Coast Gold Conference held at the QT Hotel in Surfers Paradise.

Among several mining executives, precious metals dealers, and investors I met, I was fortunate to catch up with the Deputy Chairman of a leading ASX-listed gold producer, Ramelius Resources [ASX:RMS], Simon Lawson. He also sits on the boards of Gorilla Gold [ASX:GG8] and Mammoth Minerals [ASX:M79].

Some of you may know Simon quite well. He’s well-respected in this space, having started out as a geologist. He became a legend in the industry for turning around Spartan Resources (formerly Gascoyne Resources) in two years.

Shareholders had once despaired over their losses when operational troubles at the Dalgaranga mine threatened to sink the company, not once, but twice. Many enjoyed substantial gains as Simon turned around a struggling producer with a market capitalisation of less than $100 million in 2022 to a $2.4 billion developer before Ramelius Resources acquired it in July 2024:

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Simon and his team did what others hadn’t thought of and drilled at the right places in the Dalgaranga mine, discovering what is now known as the Never Never deposit. It’s one of the highest-grade underground gold discoveries in the last five years.

In our chat, I asked Simon about his journey in mining, how he turned the ship around when he was Managing Director at Spartan Resources, and his vision for creating shareholder value in the companies he currently works with.

So, sit back, and enjoy this video:

If you want to build a gold stock portfolio it’s best to do so with some guidance. One way is to receive regular updates on the precious metals market and insights on individual companies.

With my precious metals investment newsletter, you can draw on my experience from almost 15 years of investing and researching this market. I also have a book that details my journey, insights, and lessons.

You can learn all about it here.