Ukraine to Begin Commercial Gold Mining

KYIV, Ukraine, August 10, 2011 /PRNewswire/ --

This year Ukraine will start its own large-scale gold mining, according to the representative of the State Service of Geology and Mineral Resources of Ukraine Eduard Stavyts'kyi. The ministry official confirmed that Ukraine's gold resources have been estimated at 2,500-3,000 tons.

The State Service of Geology and Mineral Resources of Ukraine explain the decision to begin mining Ukraine's gold deposits by the radical growth of the world price of gold.

Nowadays, Ukraine imports about 5 tons of gold per year and produces no gold of its own. By establishing the commercial mining of gold the ministry suggests that its import may be reduced by one third. Moreover, in three to five years Ukraine is expected to produce at least one ton of gold domestically, gradually increasing its production capacity. The domestic production of gold, according to the ministry official, is to start this year.

The gold mining will incept in the Western Ukraine and Kirovograd region [Central Ukraine -ed.]. Experts estimate Ukraine's gold resources at 400 tons in the Carpathian Mountains (Western Ukraine) and 500 tons in the Donbass region (Eastern Ukraine). The rest of the resources are located in the Kirovograd and Dnipropetrovs'k regions, as well as Crimea.

In March 2008, the price of gold for the first time ever exceeded USD 1,000 per ounce and in the following three years it grew by 70%. Despite the fact that after this spike the price of gold was fluctuating and shortly afterwards dropped by almost 30%, it still continued growing steadily in the years to come.

Gold hit a new record high on June 6, 2011, settling at USD 1,549 per ounce. On August 8, 2011, the price reached USD 1,693, breaking the USD 1,700 mark later in the day. The increase of almost 9% within just two moths made for one of the most significant gold price growths in history.

Traditionally, gold has been used as a vehicle for monetary exchange. Despite the substitution of the Gold Standard by the Dollar Standard, gold remains an important national reserve, with every state stocking up on gold to secure its financial position, especially during the times of the financial crisis.

Official Web site of the State Service of Geology and Mineral Resources of Ukraine http://www.dgs.kiev.ua/