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What: Shares of Centerra Gold (NASDAQOTH:CAGDF) jumped as much as 13% briefly today after updating its reserves.
So what: Management said that indicated resources increased by 406,000 ounces at its Oksut project in Turkey, to 1.1 million ounces. Probable reserves increased by 114,000 at the Gatsuurt project in Mongolia.
Now what: Those were the positives, but gold reserves fell by 53,000 overall this year after accounting for 912,000 processed ounces. The other challenge is that the company's year-end reserves were estimated using a gold price of $1,300 per ounce, down from $1,350 a year ago, but still above today's price of $1,258. That's the core problem for gold miners, who have less economically viable gold as the price falls, which I think it will continue to do in 2014. For that reason, I'm not buying into the pop today.
Travis Hoium 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.