ABSTRACT' The first references to gold in New Guinea were by the Portuguese in 1525. The first significant discovery and gold rush was on Sudest Island in 1888 and was a natural extension of the rush that surged up Australia's eastern coast and ended at cook- town. Prospectors made a series of minor discoveries in coastal regions before the first large discovery at Wau/Edie Creek/Bulolo in 1925. Major post war gold discoveries were made at Bougainville, Frieda River, Porgera and Ok Tedi. On Misima Island a large bulk low grade deposit has been recognised surrounding old gold workings. Gold exploration has increased drama- tically since the lifting of a 3 year moritorium on new exploration areas in Noverrber 1982. A new bulk low grade gold discovery has been made on Lihir Island, north of Bougainville and a number of other promising areas are being drilled. Gold production is also expanding dramatically from current levels of 600,000 ounces to an anticipated 1.3 million ounces in 1985 with the opening of Ok Tedi. Other potential developments are likely to increase output above 2 million ounces by 1990. Papua New Guinea's world ranking as a producer is likely to move from 9th to 7th in 1985 reflecting the favourable geological potential, stable political environment and attractive development terms offered by the Government.