Refining Gold - Frequently Asked Questions on Gold Refining (2024)

The process of refining gold involves several steps. It starts with melting down the unprocessed gold to a molten state. Next, a gas containing chlorine is circulated through the molten gold. This gas helps transform impurities and other metals into a solid state, making it easier to separate them from the gold. Through this meticulous process, the gold obtained remains remarkably pure, typically at 98% purity.

However, if you have no prior experience refining gold and are concerned about your personal safety, it is best to defer to the expertise of trained specialists or, at the absolute least, seek the guidance of an individual who has relevant prior experience before proceeding. Do remember to wear the appropriate safety gear such as shoes glove, goggles and apron to protect yourself.

The temperature at which gold melts (boils) is 1064 degrees centigrade or 1947.2 Fahrenheit and melting it at this point poses a significant danger of serious burns due to the high temperature.

You can earn more money for your gold if you sell directly to a refinery and avoid the intermediary. Most people cannot sell gold directly to a refinery because of the anti-money laundering (AML/KYC) requirements, which oblige refineries to utilize intermediaries for these transactions, adding another layer of complexity.

Regulation of the industry much like it has with Banks has forced additional layers between sellers and the end refinery, this is called layering in banking and the same is true of the precious metals industry. The like of the LBMA Audit refineries to ensure their clients pass the appropriate standards, but there is a thin veil over who sells the gold in the first place to the refineries clients.

If you have access to the necessary chemicals and can afford the refining equipment, and supplies, you may start your own gold refinery. Gold refining is a lucrative enterprise because of the huge demand in the jewellery industry and precious metals investors worldwide….

The following refinery processes can include:

Cupellation

Inquartation

Miller Chlorination Process

Wohlwill Electrolytic Process

Aqua Regia Process

Gold always holds value, regardless of how old it is or what condition it is in. Scrap gold is a lucrative business for many individuals. As a result, many people find themselves drawn to it. It’s possible to run a profitable scrap gold company if you know how to do it.

The average cost to set up a gold refinery is approx. USD9m to USD12m for setting up a 1MT gold refinery.

If you are interested to build a refinery and have that sort of money Contact Us directly and we can discuss it further.

The charges applied to refining gold come in three stages typically, but every refinery has a slightly different way to skin the cat! Here is a breakdown of the 3 main areas where costs will be applied.

Refining gold charges will change from refinery to refinery, some will price in grams whilst others in ounces and the charges will differ based on the purity. A range of purities where prices will differ cane be say 50 to 70% purity at one price, 70 to 90 once price and 90% and above another price still. Its always best to bring a higher purity to a refinery as the payables are higher. I have seen some refineries offer say a 1% for lots over 50 ounces but always check if they are refining themselves to 995+ or refining part way then sending to another refinery for a higher purity level.

Some refineries charge for melting and others don’t, but rest assure if they don’t the price is baked into your gold refining charges somewhere along the line.

Gold Fire Assay Method is the standard accepted by industry and is performed in a laboratory by a qualified professional, in some instances XRF or water/gravity methods are accepted but where possible always go with a refinery that’s giving you Fire Assay Method.

I have seen Fire Assay charges go from $30 to $100+, so always ask for a discount where possible or look at your total payable and decide if you should bring your gold to another refinery.

You want to get to as close to 100% payables on Gold Purity and Weight after Fire Assay results. This is where the cat skinning really occurs in many refineries the tricks of the trade are sleight of hand.

Some refineries pay a higher percentage and exclude the silver and other charge less and make silver payable. Think about that for a moment, do you want to be paid more in Gold or Silver? Trust me some clients just didn’t get it until we built a spreadsheet showing them the differences per ounce.

Some refineries even have been known to shave off purities from the output by the chemist to give the clients less payables. Remember is a scrupulous business to be in and it’s all about having a high turnover daily so you need more and more metal to make it work!

Then there is fixing the gold price for settlement, some choose to be unhedged (many mining companies opt for this) and many use theLBMA Gold Price which was formerly known as the LBMA AM or PM Fix (the name was allegedly changed to protect the innocent bankers accused of price fixing) whilst other traders like to hit the gold spot price.

When you are talking to a gold dealer he is looking to predict which way your order will be going (Buyer or Seller) and will shade the price accordingly, why does he do that? Well he needs to maximise his book and he has a slight moment of profit that he can run in the moment before closing out your position but rest assure if he gives you a price, then that is a firm price and you should always hold him to it!

My suggestion would be to never tell him if you are a Buyer of Seller! In some cases he will always know based on your profile, which is why you should wherever possible using a trading platform and fix the price yourself but do not the spread already has their profit baked into the price..

Many small traders will look at the Kitco app, this has a $1 spread and does not reflect the actual spot price you will deal on so get your refinery to give you market access to the Gold spot market so you can fix your own gold price.

Pure 24k gold must be mixed with the appropriate proportion of other metals in order to make 14k gold from 24k. To make 14k, we require 58 percent pure 24k gold in 14 of the 24 components, whereas 42 percent (or 10 components) are other metals.

Pure gold, characterized by its high melting point, can be skillfully shaped using a variety of techniques that do not require reaching its elevated melting temperature. These methods include:

1. Cold Working: Gold’s malleability and ductility are evident even at room temperature, allowing skilled artisans to shape and form it through techniques such as hammering, rolling, or pressing without the necessity of heating it to its high melting point.

2. Casting: Rather than melting pure gold, craftsmen often utilize the lost-wax casting method. This approach involves creating a wax model of the desired shape, surrounding it with a mold, and then heating the mold to remove the wax, creating a cavity. Molten gold, at a lower temperature than its high melting point, is then poured into the cavity, taking the shape of the original wax model.

3. Gold Alloys: By blending pure gold with other metals like copper or silver, the resulting alloy has a higher melting point, making it more workable while still retaining the desired gold color and properties.

4. Electroforming: In the electroplating process known as electroforming, a thin layer of gold is deposited onto a surface, allowing for precise shaping and detailing without subjecting the entire piece to the high melting point of gold.

What Electronics have the most Gold in them?

Following the CPU, memory, and circuit board fingers/connectors / pins are the next most valuable metals by weight, with circuit boards and hard drives coming in at the end of the list.

In the melting of Gold and Silver, Borax aids in the removal of Oxides and other impurities, and produces a fluid borate slag that accumulates on the metal’s surface. A carbon-graphite or clay rod is regularly used to remove the slag.

Bullion banks act as the gold market’s go-between giving miners long term off take agreements which a miner can bring to a local bank and secure additional loans for equipment. Miners produce gold, but they may not do so at the same time as buyers want to purchase the metal.

Banks serve as a type of clearing house: when the gold mining company produces enough gold and wishes to sell, they may do so to the bank who will pay them either on wheels up with a high value logistics and security company who confirms the pick up and is 100% insured. Payments are made up to 95% of what is shipped based on the arrangements between the mining company and the bank, however this will be much less if a jurisdiction is more high risk.

Consumers may ultimately purchase that gold once it has been refined by the banks designated refinery but consumers can purchase the gold directly via the bank which is typically overpriced to retail buyers, so again shop around because banks are not the best place to buy gold!

The Top 5 Gold and Silver Refiners in the World

• PAMP, Switzerland
• Metalor Technologies, Switzerland
• Argor-Heraeus, Switzerland
• Valcambi, Switzerland
• Heraeus, Germany