SUMMARY :

 

1) Defining gold and precious metals 

 

      Gold's place in the family of precious metals

Gold (from the Latin aurum) belongs to the family of precious metals because of its unique properties, which make it an exceptional material. 

The precious metals family includes gold, silver, palladium and platinum. These ‘fantastic four’ occupy a very important place on the financial markets and in international trade. 

Gold is undoubtedly the most recognised and emblematic of these precious metals, thanks to its versatility. It is used to make jewellery, in the electronics industry and as a safe haven for investors in times of high volatility or economic and financial crisis.

 

      Other precious metals 

Silver, commonly known as ‘poor man's gold’, is another highly sought-after precious metal. Once again, it is used in electronics, industry, solar energy and medicine. It is also an interesting metal for investment (collector's coin, ingot, bullion), but its price evolves differently from that of gold on the markets. It is not really correlated with gold and is also more volatile than gold.  

Finally, platinum and palladium play a vital role in certain industrial applications, particularly in the automotive sector. In particular, they are used in the manufacture of catalytic converters. One of their particular features is their sensitivity to economic variations and environmental regulations. 

As you will have gathered, precious metals are few in number, rare to extract and each has its own specific characteristics. It is therefore essential for any investor wishing to diversify his portfolio of assets to be well informed, particularly about the economic and industrial dynamics that influence their price.  

For gold in particular, detailed and accurate information is essential, ideally with the help of experts such as GODOT & FILS, to take full advantage of the potential of this golden metal over the years.

2) Physical and chemical properties of gold

 

In most cases, precious metals are found in the ground, in the form of ores. Gold occurs naturally in the earth's crust in a pure state, which is relatively rare for a metal.

As a precious metal, it is often associated with other elements such as silver, platinum and palladium, although it is distinguished by its exceptional chemical stability.

 

Gold is also unique among precious metals:

  • It has a very distinctive bright yellow colour that gives it an incomparable brilliance. Metals are generally silver or grey.
  • Gold also has a very high density. In other words, even in small quantities, this metal weighs a great deal.
  • Gold has excellent thermal and electrical conductivity. Its use in electronic components is therefore particularly sought-after.
  • More surprisingly, gold is one of the most malleable metals on earth. It can be stretched, elongated and extended into a variety of shapes (gold wire, gold leaf, gold ball, etc.).
  • Gold's primary characteristic is its remarkable density. Its density is 19,300 kg/m3. It also has a high atomic weight, reaching 196.9665 g/atom. Finally, it should be noted that gold melts at a temperature of 1064°C and evaporates at an extreme temperature of over 2800°C.

      Chemical characteristics of gold

In essence, pure gold is a ‘metallic’ chemical element with the symbol “Au” and atomic number ‘79’. It is perfectly suited to industrial uses, as it is the least reactive of all metals:

  • It does not degrade in contact with water or air
  • It is not sensitive to common acids
  • It is non-magnetic, meaning that it is insensitive to magnets
  • It is resistant to corrosion and oxidation. In other words, it does not rust or tarnish, even over the long term.

This resistance and stability in the face of the natural elements helps us to better understand the ancestral use of this metal and the trust it generates. So it's not surprising that gold has always been used for decorative and ornamental objects, as well as for monetary reserves and investment assets (in coins or bullion, for example).

Its extraction and ecological impact

 

      Gold mining

The preciousness of this highly sought-after metal is mainly due to the difficulties involved in extracting it from the ground. Gold is one of the most expensive metals to extract. This cost is not just an accounting one, but also an ecological one, as intensive extraction is often destructive to the environment. 

From a purely geological point of view, gold is extracted from primary deposits (rocks) or alluvial deposits (sediments). There are therefore several types of mining:

Open-cast mining, as in stone quarries. This method is used when the deposit is relatively close to the surface.

Underground mining. This type of mining is particularly costly to probe and extract gold from deep deposits.

Alluvial mining. This method is less common and is carried out by dredging in rivers or old riverbeds.

There are two main forms of gold mining:

  • Industrial extraction. This generally involves extraction by cyanidation. This involves ‘crushing the ore and treating it with a cyanide solution to dissolve the gold’. This is a particularly effective technique for recovering gold from very poor rock.
  • Artisanal gold panning. This technique is used mainly in developing countries. Here again, chemical treatment is required, this time with mercury to amalgamate the gold.

      Environmental impact:

 

These forms of gold mining using chemical treatment are highly effective in separating gold from other natural elements. But they are also very dangerous for the environment and have a lasting impact on biodiversity. Gold mining is now considered to be one of the most polluting industries in the world.

  • In the case of industrial mining, the massive volumes of toxic waste generated can leak, contaminating soil, groundwater and rivers with cyanide residues.
  • In artisanal gold panning, the use of mercury, a particularly toxic heavy metal, leads to air and soil pollution, particularly of aquatic ecosystems. This exposes the local population to potentially serious neurotoxic effects.

In addition to the massive use of toxic products, gold mining has a very heavy physical and human footprint on our planet:

  • Far too many CO₂ emissions. In fact, oil production and refining still require an enormous amount of energy, producing a significant carbon footprint. 
  • Soil erosion, with changes to and diversions of watercourses.
  • Destruction of natural habitats and massive deforestation. Official mines, particularly open-cast mines, leave unstructured mountains and countless craters (sometimes visible from space). Illegal mines (often in the Amazon) destroy large quantities of forest and vegetation. 
  • In some parts of the world, mining is still very much a cottage industry, and working conditions are extremely precarious, with clear violations of human rights (child labour, human exploitation, etc.).

 

Against this backdrop, what solutions have been adopted to make gold mining more responsible? 

The gold sector is well aware of the issues at stake. In fact, there are a number of initiatives to address this environmental issue. 

- The introduction of ‘ethical labels’. There are labels such as Fairtrade Gold, which are committed to extraction that respects both the environment and workers' rights. At the same time, NGOs are campaigning for gold to be traceable and for human and environmental rights to be respected.  

- The recycling of gold, particularly from electronic waste or old jewellery, is increasingly used in the jewellery industry. This offers a credible and more sustainable alternative application to gold, ideal for a timeless metal. 

- In the financial sector, more and more listed companies whose business is gold mining, such as Barrick Gold or Newmont Corporation, are having to show their goodwill by committing to corporate social responsibility (CSR) initiatives. Some investors no longer hesitate to favour these companies and, on the other hand, boycott those that do not meet these criteria.