My Answer to Reader Query About Selling Placer Gold (Part 2)
(Spot gold price chart...notice the strong upward sweep. Wow!)
One of the most common misconceptions (usually held by "newbies" or the uninformed) about placer gold is that it can be sold for "spot" gold prices. Nothing could be farther from the truth.
The daily spot gold prices you see or hear quoted online or on the radio or TV are based on a troy ounce of gold rated at .999 purity. That means that commercial gold bullion such as ingots or one-ounce "rounds" are 999 parts pure out of a possible 1000 parts. In other words, they are cast with "pure gold."
An Inexact Science
Placer gold, on the other hand, is typically "contaminated" by other metals such as silver or copper or both. (By the way, you won't get paid for those minute amounts of silver or copper so forget trying to work that angle!) Most placer gold I've recovered in my small-scale mining career ranged in purity from a low of around .750 to a high of .917 fine. There are visual clues to estimating the purity of placer gold and some of these are:
1) The more lustrous yellow or "golden" your placer gold looks the purer it will probably be.
2) If your placer gold appears very "orange" in color or"pinkish" this means that it probably contains greater amounts of copper.
(From a purity standpoint, some of these gold nuggets from the Aussie Outback appear to contain larger amounts of copper.)
3) Placer gold that has a very light golden color or appears to have a slight bluish or pale cast probably contains more silver than normal. (In the old days gold with large amounts of silver in it was known as "electrum.")
Here's the Kicker
Here's the kicker of course...visual interpretation of the purity level of placer gold is, at best, a very inexact science. No gold buyer in the world is going to purchase your placer gold based on a visual interpretation of its purity level. No sir or madam...that gold buyer will test your placer gold first (usually a simple acid test...sometimes sample assays for large amounts) before he or she shells out any cash to you.
Gold Panning Kits
Maybe now you can start to see some of the issues or difficulties involved with selling placer gold from a purity standpoint. Now here's a simple gold purity math problem for you:
Q. If the current spot price for a troy ounce of .999 gold is $1,600.00 and you have one troy ounce of placer gold to sell that has been verified to be of .850 purity, how much is your troy ounce of placer gold worth?
A. If you said $1,360.00 you got it! (It's not rocket science right?)
However, don't expect to get paid $1,360.00 for your troy ounce of placer gold. What??? Why??? We'll talk about that next time. Until then, good luck and good hunting out there.
If you liked this post, you may want to read: "Gold Mining Questions and Answers: Part 4"
(c) Jim Rocha (J.R.) 2012
Questions? E-mail me at firstname.lastname@example.org