During the last month has been somewhat of a resurgence in the mining sector. The Market Vectors Gold Miners ETF has bounced from October's lows of $23 to a high of $26 at the end of the month. This has rekindled some interest in the sector.

However, the price of gold has started to decline once again, and although it is far from June's low of $1,205 per ounce, I would not rule out the price of the yellow metal falling once again to this level.

So, for investors who are seeking some exposure to the mining sector, where are the best opportunities?

Hunting for gold
Hecla Mining
 (NYSE:HL) describes itself as the largest primary silver producer in the U.S., one of the lowest-cost producers, and a growing gold producer.

That said, the company's production has been held back during the past two years as it conducted a major overhaul of its Lucky Friday silver mine. However, during the third quarter the Lucky Friday mine ramped back up to full production. During the quarter Hecla produced silver at Lucky Friday for a cash cost of just over $9 per ounce, 49% lower than the second quarter, and management expect costs to fall further into the end of the year.

All in all, for the fiscal third quarter Hecla reported a cash cost per ounce of silver produced, after by-product credits, of $7.40. However, with costs at the lucky Friday mine expected to fall further, this overall cost should follow suit.

Historically, Hecla has been debt-free but the company borrowed $500 million during the third quarter to acquire Canadian gold producer Aurizon as well as other mining interests. The additional gold production added $42 million to Hecla's top line during the third quarter, boosting year-on-year revenue by 30%. Still, Hecla's acquisition of Aurizon is only just starting to contribute to the company's bottom line, and further efficiencies should start to filter through during the next few quarters.

So overall, Hecla's mining costs are falling and output is rising. Good times should be ahead for Hecla and its investors.

A very low-cost producer
Another company that I am positive about is Alamos Gold (NYSE:AGI). In fact, Alamos is probably one of the best long-term gold mining investments available right now. Why? Well, the company's main asset, the Mulatos Mine in Mexico is guiding for an all-in-sustaining cost of $785 to $825 per ounce of gold produced for 2013, which is extremely low. In comparison, industry leader Barrick Gold produced gold at an all-in-sustaining cost of $918 per ounce during 2012 .

Investors need to focus on Alamos' low production costs of gold. In particular, Alamos' low cost of production means that the company is well placed to ride out any volatility in the gold market. Actually, Alamos has singlehandedly proven this point during the past five years, and the company has remained cash generative throughout this period. In particular, while many miners are struggling with writedowns and rising levels of debt, Alamos reported a strong net cash balance of $492 million at the end of the fiscal second quarter, this works out at around $3.82 per share. Once again if I use industry leader Barrick Gold as a comparison, Barrick has accumulated $14.2 billion of debt, a debt-to-equity level of approximately 100%.

What's more, Alamos has a number of low-cost projects under construction, including two mines in Turkey, which are currently predicted to have low production costs of around $600 cash cost per ounce.

However....
Unfortunately, with the price of gold consistently falling, some miners are struggling to stay above water. One such company is Brigus Gold (UNKNOWN:BRD.DL), a relatively small producer, mining only 23 thousand ounces during Q2 2013 (Alamos produced 53 thousand ounces during the same period). However, Brigus' total cash cost per ounce was $908, and due to the company's relatively small production run and lack of any serious economies of scale, the company's all-in sustaining production cost was $1,365. That said, this figure was lower than the figure of $1,717 per ounce reported during the second quarter of 2012.

Unfortunately, this indicates that Brigus is going to be making a loss at current gold prices. Actually, Brigus' all-in-sustaining cash cost per ounce is 49% above that of industry leader Barrick.

Foolish summary
The gold mining sector is beaten down, and miners could be sailing into rougher waters. However, Alamos and Hecla are both good companies that are working toward low-cost production and high profits.

On the other hand, perhaps investors should avoid high-cost Brigus as the company's second quarter all-in-sustaining production cost per ounce of gold indicates that the company will struggle to make a profit with the yellow metal trading below $1,300 per ounce.

 

Fool contributor Rupert Hargreaves has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.