Friday also capped what was a particularly dismal week for Barrick Gold (TSX:ABX), one of the world's biggest producers, after an environmental challenge in Chile halted one of its major projects.
On the Toronto Stock Exchange, Barrick stock closed down $2.06 or 8.24 per cent at $22.94 on heavy volume of almost 10.5 million shares.
That followed another drop of more the eight per cent Wednesday in the wake of a decision by a Chilean court to halt construction on its $8-billion Pascua Lama mine high in the Andes on the border with Argentina.
However, other gold stocks were also hurting Friday, with gold miners the four most active issues — and all in the red — on Toronto's main board.
Overall, the TSX gold sector led decliners as the June bullion futures contract fell US$63.50 to US$1,501.14 an ounce.
Gold prices, which hit a record highs near US$1,900 an ounce back in August, have been falling since beginning the year and stock prices of miners have come down with them.
Earlier this week, Goldman Sachs dropped its bullion price forecast for 2013 to US$1,545 an ounce, down from a prior forecast of US$1,610.
As well, minutes from the latest meeting of the U.S. Federal Reserve showed some support for an early end to quantitative easing, making gold less important as a hedge against inflation and undercutting support for prices.
But it's not just bullion prices, said Robert Gorman, chief portfolio strategist at TD Waterhouse.
"Miners face a host of other issues," he said. "It’s your extraction costs, it’s your political risk and so on."
An prime example was the Chilean court decision halting construction on Barrick's Pascua-Lama mine project after indigenous groups argued that it threatened area water supplies.
The company is also facing problems in the Dominican Republic where the government wants to rewrite the royalty contract for its Pueblo Viejo mine.
Other miners face similar demands from environmental groups and money-strapped governments in other jurisdictions.
In addition to Barrick, the next three most active issues on Toronto's main board were: Kinross Gold (TSX:K), down 47 cents or 6.83 per cent at $6.41, Yamana Gold (TSX:YRI), down 96 cents or 6.75 per cent at $13.27 and Goldcorp (TSX:G), down $1.44 or 4.57 per cent at $30.07.