Barrick (NYSE:ABX), Newmont (NYSE:NEM) Drive Nevada Mining Costs Lower

Even though gold production in the state of Nevada fell for the first time in ten years, the state remains the sixth-largest gold producer in the world, still led by mining giants Barrick Gold (NYSE:ABX) and Newmont Mining (NYSE:NEM).

Nevada, which lags behind only China, South Africa, Australia, Russia and Peru in gold production, ended 2009 producing $5.1 billion in gold and silver combined.

Barrick and Newmont also helped push down the cost of production as well for the state, falling from $525 an ounce in 2008 to $508 an ounce in 2009.

The amount of ounces produced in 2009 was 5.64 million, according to the Natural Resource Industry Institute at the University of Nevada, Reno, economist John Dobra.

Only one downside has been found in Nevada gold production, and that was the amount going into exploration, which fell from $158 million in 2008 to $110 million in 2009.

Most of that is attributed to tight credit markets rather than lack of opportunity and interest.

Dobra concluded concerning provable and probable reserves, that even if all the gold in Nevada has been discovered, they could continue mining at current levels until at least 2023.

But even with less exploration, a number of new deposits have been found, and the future continues to look bright for Nevada gold mining and the companies who have a large stake in the state.

In case it ever does slow down, gold producers in Nevada have been keeping their richest deposits on hold for times when that may be all they have to produce. It's unlikely they'll have to employ that strategy for decades to come.