Refinery

A refinery (also known as a precious-metal refinery or assay refinery) is a specialised operation that extracts precious metals from impure raw materials and processes them into high-purity fine metal. To refine here means to separate the metals from one another – for example gold from silver, copper or platinum.

What refineries process

The raw materials come from two sources:

• Primary material: doré bars and concentrates directly from mining.
• Secondary material (recycling): dental gold, jewellery and broken gold, industrial scrap, catalytic converters and electronic waste.

From this mixture, the end products are fine gold (999.9), fine silver and the platinum-group metals in standard commercial purity – as bars, granules or casting material.

How refining works

Classic processes are refining via chemistry and electrolysis. In the Miller process, chlorine gas is passed through molten gold to bind base metals; the Wohlwill process uses electrolysis for the highest purities above 999.9. Silver is usually refined electrolytically. Only this purity turns the metal into marketable goods whose value is measured exactly against the spot price.

Significance for sellers of scrap gold

Anyone selling scrap gold is indirectly selling into the material cycle of the refineries. Reputable buyers determine the fineness by analysis and pay out a fair share of the material value. Some refineries also buy directly from private individuals – often on better terms than intermediaries, because one trading stage is eliminated. The purchase-price calculator shows what is realistic; the pure material value is given by the melt-value calculator.

LBMA Good Delivery

The most respected refineries are listed on the Good Delivery List of the London Bullion Market Association. Bars from these houses are regarded as flawless worldwide and need not be re-assayed on resale – a quality mark that also enhances the resaleability of investment bars.

In brief

Refineries stand at the beginning and the end of the precious-metal cycle: they turn ore and scrap gold back into tradeable fine metal. For sellers of broken and dental gold they are – directly or via buyers – the decisive source of value.